By Tim Vandenack, Truth Staff
tvandenack@etruth.com
Elkhart County isn't an island unto itself when it comes to growth and economics.
"We're experiencing a downturn like every other county, every other state in the United States is seeing right now," said Gretchen Helman, executive officer of the Builders Association of Elkhart County.
Indeed, look at building trends here, as she and a cross-section of other Elkhart County leaders did at a gathering earlier this week, and they paint a gray, though not altogether dismal, picture.
John Letherman, president of the Elkhart County Council, termed the numbers -- which show a dip in permits to build new homes, commercial buildings and industrial structures -- "serious."
Bruce Piekarski, president of Horizon Bank in Elkhart, said they are indicative of a lack of certitude, particularly among would-be home buyers.
"What we're not seeing, maybe, is confidence," Piekarski said.
Still, even if some key numbers are down, Helman warns against adopting a "doom and gloom" outlook. "We're hunkered down, waiting out the storm," she said, alluding to an estimate from the National Association of Home Builders that things will turn around by the end of 2008.
Similarly, Goshen Building Commissioner Mike Leasor detects some demand for homes out there, at least among "low-end" and first-time buyers.
"It's still out there, there's still some growth," he said. "It's just not as fast-paced as it (was)."
'Market corrections'
The figures reviewed by the County-Cities Forum, compiled by the Elkhart County Planning Department, show a notable drop in new building permits since 2005 in Goshen, Elkhart and the unincorporated portions of Elkhart County. The forum operates under the auspices of the Elkhart County Planning Department and brings together elected officials and other leaders from the county, Elkhart, Goshen and other communities.
"In the last 25 years we've had four or five of these," Helman said. "We call them market corrections."
Letherman cites the repercussions of the many home loan defaults across the nation, brought on by the subprime mortgage crisis. Helman notes rising homeowner property taxes statewide, which have Indiana lawmakers scrambling for a fix, and growing energy costs.
Then there's uncertainty dating to local elections in 2006 and the ongoing U.S. presidential campaign.
"People are waiting to see who's going to be in power and where the country is going," Helman said.
More particular to Elkhart County, Tom Starks, a member of the county Redevelopment Commission, cites a slackening in the recreational vehicle industry. Building permits in 2004 and 2005 alone, spurred by local incentives, accounted for as much as 1.5 million square feet in new commercial and industrial development, he estimates.
Now RV operators are scaling back, focusing operations in their newer buildings and selling off the older ones, and Starks said a turnaround could be two to five years in the offing.
"The mentality then was that things were so great it was never going to drop off," said Leasor.
Larry Harrell, the Elkhart County building commissioner, echoes that, noting that building growth here as late as 2005 was unprecedented, suggesting that a dip from that wasn't so much a decline as a return to reality. Numerous apartment buildings were built in the county, growth along C.R. 17 south of Jackson Boulevard blossomed and demand for new homes was up.
"We were riding on the world," he said. "We were having so many houses built."
Looking ahead, Piekarski notes that mortgage funding is available, interest rates are down and homes are sitting vacant on the market.
"It's getting the consumer to want to do something," he said.
And even if numbers show the larger Elkhart County building market is in the doldrums, there are pockets of growth, like Country Home Road at the northern tip of Goshen, just off U.S. 33. Taking shape along the short strip are a new drugstore, a bank, a pet goods shop, a dentist's office and a retailer.
"There's some sort of calculation that they make," said Laura Coyne of the Elkhart County Planning Department, noting factors like nearby homes and adjacent retailers that factor in commercial developers' decisions to build. And just as Country Home Road is sprouting into something new, she maintains, "you will see more."