Home additions, remodeling increase

MASON CITY — If the economy is turning around in Mason City home construction, it is because of home additions and remodeling rather than building new homes.

That’s according to figures from the city building department.

The City Council approved a program last year in which residents could receive tax abatements of up to $75,000 on the assessed value of remodeling or on new construction.

Figures from the city building department show permits were issued for 16 new homes in the fiscal year that ended June 30, 2011. So far in this fiscal year, only five permits have been issued, though that should pick up when good weather returns, building officials say.

“If there’s been an uptick, we haven’t noticed it,” said Jo Ellen Larsen, administrative assistant in the building department.

But there have been 139 permits issued so far in this fiscal year for repairs and alterations of single-family homes. That’s on a pace to top last year’s total of 224.

The latest figures also indicate a higher interest in construction of twin homes. In the last fiscal year, permits were issued for two. So far this fiscal year, with about a half-year to go, three permits have been issued.

Cathy Rottinghaus, head of the Home Loan Center at First Citizens National Bank, said people are talking about home construction but given the time of year it is, it’s just talk at this point.

“But people are optimistic,” she said, a different mood than a year ago.

The bank has experienced more activity in refinancing of existing homes.

“Rates are at historic lows and people are taking advantage of that,” she said.

Tom Quinlan, president of NSB Bank, said his bank’s experience in residential loans bears out what the building permits show.

“It’s been a better year for loans on additions and remodeling than for new home construction,” he said.

“We don’t see as much new home construction as we’d like, particularly with interest rates so low.”

Quinlan said his home loan customers are showing an interest in twin homes, validating what the city figures show.

“We’re seeing some interest in twin homes and also homes on one floor with no basement,” he said. “These are homes that are more convenient for older people.”

“We’re holding our own in home loans but it’s not as good as it could be. The market is becoming steady and that’s a good thing.”

Quinlan said agriculture has been a stabling economic influence in recent years and that has had a rippling effect on other aspects of the economy.

“The farm economy has really held up well,” he said.

“There are a lot of service industries tied to the farm economy so a lot of businesses have benefited from that.”

The city’s tax abatement program applies to work done in calendar year 2011. The city received 42 applications for abatements — four for commercial, 13 for single-family houses, 11 for garages or accessory buildings and 14 for residential remodels.

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Home additions, remodeling increase