Strained Bloomington-Normal housing market pushes growth in rural McLean County

BLOOMINGTON — The growing workforce in Bloomington-Normal has pushed beyond the Twin Cities’ borders, causing a ripple in housing markets across the rural communities of McLean County and beyond, community leaders and real estate professionals say.

“People want to move to small towns,” said Heather Witt, a real estate agent with Re/Max Rising. “Smaller towns may take a little bit more time to sell than in larger metropolitan areas, but they are still selling.”

As the market for single-family homes in Bloomington and Normal has become more strained, some new residents seem to have expanded their prospects, moving to smaller nearby communities that can help fulfill the need for housing.

According to U.S. Census data, the Bloomington-Normal metropolitan area increased in population by a marginal 1,382 people between 2010 and 2020.

But that data does not account for the newcomers who have arrived in the last 18 months in connection to the Rivian Automotive manufacturing plant in west Normal — now up to 6,600 full-time employees as of last week.

The Trail Ridge subdivision, located in the southwest portion of Lexington, had 24 lots made available in 2014 and is now down to one empty lot. The last major subdivision was built in 1992 and was not able to sell all of its lots until 2010. 


Communities like Carlock, just 11 miles northwest of Bloomington, are noticing a difference.

“It’s really been within the last two years that we started seeing the interest,” said Carlock Mayor Rhonda Baer. “I think it’s just a reflection of what’s been happening everywhere. There seems to be a shortage in housing that started a couple years ago, and they just can’t get that need fulfilled.”

After a regional housing analysis coordinated by the Bloomington-Normal Economic Development Council showed a lack of multi-family housing options coupled with a low inventory of single-family homes, some developers have begun shifting their focus to the city and town cores.

Patrick Hoban, president and CEO of the EDC, noted while Bloomington-Normal seems to be working to alleviate the housing shortage by diversifying its housing stock, the surrounding towns are less likely to add apartment complexes, instead focusing on adding more single-family homes.

Hoban said there are “tons of opportunities” for the rural communities to take on some of the growth.

“I think one of the things that we learned from the pandemic was that people are definitely into sustainable lifestyles now, and that’s really easy to do in the rural communities,” he said. “Just getting out in a space where you have more yard than you do compared to an uptown or downtown.”

He noted a downside would be aging infrastructure that might not be suited for growth. The EDC has been working with the small towns and advocating for more support from federal funds.

Raymond Lai, director of the McLean County Regional Planning Commission, said there were not clear trends in which towns were growing more than others. Besides municipalities, some unincorporated parts of the county have also seen population, and building, growth.

“It’s not really tied to how far they are from the urban area,” he said.

Rivian spokesman Zach Dietmeier noted some employees are settling in the largest cities within 50 miles of the plant — Peoria, Pontiac and Champaign.

But real estate agents and community leaders said towns like Lexington, Heyworth, Danvers, Carlock and Chenoa, even Morton and Clinton beyond McLean County, are experiencing growth and renewed interest like they haven’t seen in years.

“We’re seeing new families and for whatever reason, there are some that just would like to get out of the Bloomington-Normal area and get to a smaller community,” said Lexington Mayor Spencer Johansen. “We’ve done a lot to build up our businesses and offer more community services, so that has helped, but I just think it’s people wanting to relocate.”

Just 20 miles northeast of Bloomington, Lexington’s Main Street has evolved over the last few years, adding new businesses like Essential Coffee, Analytical Brewing and Lexington Social, as well as a new Coffee Hound and Sirius Coffee Roaster facility in the works.

Lexington’s Main Street has evolved over the last few years, adding several new businesses. “We’re seeing new families,” said Mayor Spencer Johansen, “and for whatever reason, there are some that would like to get out of the Bloomington-Normal area and get to a smaller community.” 


Census data indicates Lexington experienced an increase of 30 people from 2010 to 2020, but Johansen said he thinks more have arrived since the data was collected.

In regards to infrastructure, Johansen said Lexington’s recent investment in its water and sewer systems could be part of the reason why the community is attractive to new residents and businesses.

He said the city is in talks with property owners and developers about working on more opportunities for single-family housing as well as an apartment complex, but those plans remain in the early stages.

“Lexington right now is down to one empty lot for a new home. It’s all that’s left,” said Bruce Klein, a developer who has lived in Lexington all his life. “There’s no question that over the past 18 months the demand really picked up, but will it continue? I don’t know.”

Klein said the last major subdivision was built in 1992 and was not able to sell all of its lots until 2010. He then got involved with developing 24 additional lots made available in 2014, known as the Trail Ridge subdivision, which is now down to one empty lot.

“It’s a wonderful community,” he said. “There’s all kinds of local opportunities, but you’re not very far from the extra services of Bloomington or Normal.”

Other communities like the village of Downs, just southeast of Bloomington, have seen even more notable population growth recorded in the Census — adding 196 new residents between 2010 and 2020.

“We will allow managed growth to avoid overrunning our schools, infrastructure, and way of life in the village,” Downs Mayor Mike James said in an email to The Pantagraph.

James said most homes and subdivision lots do not stay on the market long, but they are experiencing new development along the Beecher Trails subdivision with seven new homes and a final phase that could add 38 more lots.

According to the census, Carlock saw a population decrease, but Baer said in the last two years about eight new homes have been built.

“We haven’t seen this happen to that degree in recent history.” she said, noting roughly 50 people have moved to town, pushing the population near 600. “The last time was probably in the early 2000s when Stoneman Gardens subdivision came in and several homes were being built at the same time.”

She said some of that growth can be attributed to Rivian, remembering a dip in population when Mitsubishi Motors closed the plant in 2016.

“We had some vacant homes sitting for quite a while. We don’t have that anymore,” Baer said. “We think it’s great and we want people to move in and the town to be full.”

Lots remain available in the Stoneman Gardens and Rock Creek subdivisions, but Carlock is still without an independent sewer system, making it more difficult to attract businesses, she said.

“We just need to develop and work on attracting some of those businesses while finding places for them, and we’re working on that with adding space for a business-type district,” Baer said. “It takes money in funding and grants. We have to find those resources that can help us in those situations in order to get that accomplished.”

Pantagraph journalists Kelsey Watznauer and Connor Wood contributed to this report.

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October 25, 2022 at 09:34AM

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