Building vs. Buying — Pasco Impact Fee Affects Real Estate

 
Pasco has passed an impact fee for new construction that may affect real estate in the area’s fastest growing city.  The fee has been a subject of controversy for Pasco.  It provides much needed revenue for the Pasco School District, but may negatively affect business and construction.  Pasco grew from a population of 32,066 to 59,781 in just one decade!  Much of the growth is new construction on what was once farmland.  Elementary schools are overflowing and land has been purchased and set aside, but more revenue is needed to build the additional schools. 

Current farmland to become new housing development

The impact fee has been approved by the Pasco City Council and will go into effect on April 16, 2012.   The fee will be charged for all new building permits.  The charge will be $4,700 for a single-family home and $4,525 per unit for multifamily construction.  This fee is anticipated to supply only a small portion ($3.6 million) of the approximate funding needed ($80.8 million) for the school district. 

Future Elementary school at Sandifer/Rd 60

 How will this affect real estate in Pasco?  There are both pros and cons.  If builders are unable to absorb the impact fee, it will be passed on to the consumer through an increase in lot and/or house prices, subsequently driving up the overall price of new construction.  Pasco has traditionally had the most affordable building prices, but more consumers may opt to build in Richland, West Richland, or Kennewick as the price gap narrows.  New construction remains the greatest competitor to the sale of existing homes in Pasco–the fee does not affect existing homes, so it may result in a more competitive market and could increase existing home sales. 

If you’re interested in learning more about the impact fee, building, or buying a home, please give us a call.  And if you haven’t seen it yet, take a minute to check out this fabulous 5 bedroom home in the Casa del Sol neighborhood in Pasco at 4910 Bilbao Drive.  

 

 

 

 

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