Vermillion may be a college town, but the housing needs in the near future will be greatest for people 65 and older.
That’s according to a housing study conducted this year by Community Partners Research, Inc. of Faribault, Minnesota. The results of the study were presented to the Vermillion City Council earlier this summer by Steve Griesert, a representative from the research firm.
The dates are important today as the city begins making plans for the development of 50 acres of land it recently purchased. Among the many components of this development will be apartments designed to meet Vermillion’s future needs.
“I interviewed a lot of people, called a lot of landlords, people sent me information, the city staff were great, the chamber staff were great, it made my job a lot easier,” said Griesert.
The study is rich in demographic and housing data for the city.
“The methodology we used — we looked at data from the U.S. Census, including the American Community Survey, an annual survey that conducts the census,” Griesert said.
The company also reviewed information from Applied Geographic Solutions, which is data used by the South Dakota Governor’s Office. The company also acquired information from a private reporting service.
“We conducted many interviews, we surveyed 42 rental properties in the city and we conducted a survey of 308 single-family homes and 350 mobile homes,” he said.
From 2010 to 2020, the city’s population grew by 1,124 people, an increase of 10.6%. During the same period, Vermillion added 415 homes, an increase of about 11%.
“If you factor out the growth in Vermillion, there was a small decrease in the county’s population, but that’s really good growth,” Griesert said.
A portion of the housing study was devoted to collecting labor and employment statistics in Clay County in comparison to the state of South Dakota and the United States.
“Their employed workforce has remained relatively constant since 2010. You’ve lost something during the pandemic, but you’re making your way back,” he said. “Your unemployment rate at the end of 2021 was 2.8%, so it can’t get much lower.”
The study also includes 2019 Census Bureau data (the most recent at the time of this report) showing that about 2,552 people commute to Vermillion every day for work,” Griesert said. “Well, that might be a mile away; It could be 50 miles away.
“About 1,839 people commuted to Yankton or Sioux City or wherever they wanted, and 1,957 lived and worked both in Vermillion,” he said. “Those are pretty typical numbers; You rank a little higher in commuters than commuters, but it seems like you see people coming and going in every city you’re in.”
The study states the obvious, Griesert said: “Of those 2,552, a very small percentage of those people would move to Vermillion if the right type of housing existed. Typically, people don’t move once they’re established — once they own a home, their kids are in school, they have elderly parents, their son is a quarterback on the football team — you name it, they just don’t move, but there is a percentage that would move.
“On the other hand, the 1,839 who commute every day — we strongly encourage you to keep them in the community,” he said.
Community Partners Research, Inc. believes that most of the growth of the Vermillion community over the next five years will occur in the 25-34 age group and those 65 and older. The younger group, Griesert said, will be looking for starter homes and “trade-up” homes. The older group will likely try to sell their “trade-up” homes and move into semi-maintenance homes or townhouses or senior housing with services.
According to demographics reviewed by the research firm, Vermillion has shown a sustained pattern of growth over the past three decades, with new households added each decade.
The 2020 census established a new benchmark to measure the recent rate of growth. Between 2010 and 2020, the city saw an average growth of 42 households per year. The rate of average numerical growth has also increased. From 2000 to 2010, this average was 37 households per year. In the 1990s, around 17 households were added to the city every year.
The study predicts that Vermillion has the potential to attract 124 people per year from 2022 to 2026, for an overall city population growth of 620 over that period.
“There’s all sorts of things that can greatly increase or decrease that number, but based on what you’ve done over the past few years, we’re counting on an increase of 124 people per year,” Griesert said.
The study predicts that Vermillion could grow 46 households per year from now through 2026, representing an increase of 230 households over that period.
“Again, very, very strong gains are forecast for the city,” he said.
A portion of the study focuses on household income in Vermillion.
“Obviously that’s pretty important when we look at the different types of recommendations for the type of housing that’s needed in the community,” he said, “and in 2019 — that’s the latest data we got from the American Community Survey – Your median household income was $40,874. So exactly the middle – half more, the other half less.
“That’s a little bit low from what we usually see, but that’s the student population that’s bringing that down a bit,” Griesert said, adding that data shows the median family income in Vermillion is $88,000. “That’s very high. Family income is two or more related people living in the same household. If you take out the students, the one person households and so on and most family households have two or more earners.”
The median family income of $88,000 in Vermillion is “fairly higher” than the South Dakota average, he said.
The study examines the need for rental housing in the city.
“We look at the housing cost burden, and if you spend more than 30% of your income on housing, that’s a housing cost burden,” Griesert said. “Approximately 57 percent of your rental households in the community spend over 30 percent of their income on housing.
“Only about 13% of your (home)owners spend more than 30% of their income on housing,” he said. “The reason for this is usually because they have a higher income than renters, and secondly, financial institutions only allow you to lend what you can normally afford.”
Community Partners Research, Inc. collected data on existing Vermillion home sales from Clay County.
“We’ve eliminated foreclosures and father-to-son house sales and things like that — those are arm’s length sales and in 2021 you had 142 good sales in Vermillion and the median, right in the middle, was $187,500. dollars,” said Griesert. “Here, too, half means more (in price), the other half means less. We’re taking a close look. The higher your median selling price, the more new builds there will be.”
Researchers surveyed an older neighborhood in the community to get a picture of the quality of housing in older areas of Vermillion. Representatives from Community Partners Research, Inc. conducted a visual “windshield” survey of 308 single family/duplex homes in a defined older neighborhood bounded by Dartmouth Street to the north, Main Street to the south, Dakota Street to the east, and Carr/ Franklin by road west.
“We found that about 27% were intact, about 42% needed minor repairs – maybe just a new roof or facade or windows or whatever, 24% needed about a lot of work like three, four or five improvements, and we thought 7% should probably be demolished,” said Griesert.
The survey found that about 70% of the homes in this older neighborhood were either intact or needed only minor repairs.
“That’s good news,” he said.
Researchers also conducted a survey of the condition of mobile homes in Vermillion.
“We looked at six RV parks, which we think are all,” said Griesert, “and we looked at 350 RVs. One thing we noticed when we went to these RV parks was that there was a lot of activity where newer RVs were brought into the park and presumably older ones were taken out.
“We don’t typically see that in most RV parks that we look at in different cities,” he said. “We’re seeing a lot of action being taken to improve the quality of most RV parks, which we found to be really positive.”
Across the six RV parks in Vermillion, nearly 43% of the units were classified as intact and nearly 25% in the minor repair category, according to the study. Citywide, 76 of all RVs were classified as in need of repair and 38 homes as dilapidated and likely past the point of economically viable rehabilitation.