The Importance of Infill Development

Driving through many small towns there is a clear development pattern that has grown in intensity over the past few decades. New housing is sprouting up on the fringe of the community placed on large sprawling lots that often cover multiple acres. This, while the housing stock of the core of the community continues to dwindle. Whether it be from fire or some other natural disaster or through dilapidation and eventual destruction. The resulting lots are either left undeveloped or bought by a neighbor wishing to extend the size of their yard. There are clearly open spaces that used to be occupied by housing but are left empty while new development takes place on the edge of the city. Rarely is infill development taking place and it is hurting communities more than many think.

The subject of infill development is not a hot topic for most small towns in the Midwest as there are rarely any limiting geographical extents to the development of communities with adjoining areas of green fields ripe for development. Yet, just as sprawl has a suffocating impact on the nation’s suburbs, the relative unintentional sprawl that has taken place in many small communities is slowly doing the same to smaller communities, it just hasn’t been paramount in the view of those living in the community as it has been a slower impact.

Rising Costs to Maintain Infrastructure

In addition to spot housing development on the community’s fringe, there’s also the advent of large-lot residential areas just outside of the city limits. Residents of these areas often badger city councils to annex their areas in so they can receive city services, but the ongoing cost to provide services to these areas is expensive and will only grow exponentially as inflationary impacts to the construction of utilities hits city budgets.

The consideration of infill development will be key to the cost-effectiveness of the provision of service to the community. Usually, residential developers pay the costs to extend the necessary infrastructure to each residential site within their development. However, the long-term maintenance costs are rarely considered when a new housing development comes in.

For each new greenfield site created, there are new roads that are paved. New roads in the midwestern climate are “new” cars, which aren’t “new” as soon as they leave the dealership. They require regular maintenance in order to elongate their lifespan before you are forced to do a full rehabilitation like an asphalt overlay. Each new road has to be plowed of snow during the winter and cleaned of salt and sand during the warmer months.

Installed utilities are not install-and-forget either. Water, sewer, and stormwater lines all have varying levels of maintenance requirements through the years. Streetlights and fire hydrants also need to be taken care of over the years.

Does infill development have this same infrastructure to take care of? Yes, but it’s already there, you are already taking care of it.

Consider the Cost on a Block Basis

Let’s take into consideration a case study. Looking into my hometown of Red Oak, Iowa, I’ve picked a typical 12-lot block within the central core of the community. One of the houses on this block is assessed at roughly $56,000. The net taxes collected on this property is about $1,350. If only 10 of these lots have a house of this valuation, your community is collecting $13,500 per year to provide city services to this block.

Now, for the sake of this exercise, let’s add two houses valued at $150,000 each to the remaining two lots. The net taxes for each house would total to roughly $3,700 per year. This would increase the yearly property tax intake from that block to about $20,900.

Note: For those naysayers that state, “You can’t build a house for $150,000 anymore!”, this is just an exercise. Relax.

With infill development, the property taxes coming into the city’s coffers goes up $7,400. That’s without adding more infrastructure to maintain. That’s without adding more road miles for the police to patrol. It should also be considered that no additional parks would be needed to serve this existing area as well.

With infill development, your community can work on improving existing services to your residents rather than expanding services to serve new areas.

Impacts on Community Character

There’s also the impact that the lack of infill development has on the overall perception of the community. As people drive down the streets of a community with open lots in between the existing housing units, there is a feeling of a row of teeth in a mouth with a few missing. This impacts the community’s general feel of the community significantly.

“Empty Lot”, Jeff Hitchcock, WikiMedia, CC-BY-SA 3.0

Ways to Promote Infill Development

There are a number of actions that communities can undertake to help kickstart the chances for infill development. First, make sure your zoning ordinances make building new housing possible. Many modern zoning ordinances are suburban-based. Hence, they don’t take into consideration the smaller lots in the older parts of town. With suburban-style setbacks, the building envelope (buildable area) makes new construction tough. So reduce setbacks in older neighborhoods as necessary, or create a new district specifically for smaller lot residential.

Also, take into consideration the waiving of utility hookup fees for new infill development. The benefits of adding a new user along an existing utility line greatly outweigh the hookup costs to the community. If your municipal utilities are savvy, they’ll understand such benefits as well.

Become a real estate mogul. For those who want to make a bolder move, maybe it’s time to start owning land. Depending on redevelopment statutes and other regulations in your state, a community can purchase land to sell at a reduced cost. to promote infill development. Sometimes it takes a community foundation as the owner entity to make it work. Selling infill lots, even for free is a viable way to cut down the cost of a new construction project.

Atchison, Kansas has even made an “Infill Housing Development Guide“. The guide provides a “collection of resources intended to help contractors, developers, investors, and potential homeowners understand how to take advantage of the various offerings the City has compiled to incentivize infill housing development.”

In Iowa, the Homes for Iowa program creates homes at a reduced price. When teamed with a price-reduced infill lot, the affordability of the housing unit is improved. Creating a win-win impact for first-time homeowners and the community alike.

A Worthwhile Endeavor

Whatever tool your community utilizes to incentivize infill housing, it is a worthwhile endeavor. The benefits of infill housing development reach far beyond the basic aesthetics, community character, or fiscal appropriateness.