Oskaloosa Sees Major Increase in Housing Development as City Works to Address Shortage

Shawn Christ with the City Of Oskaloosa stopped by the Oskaloosa News studio to talk development in the community.

OSKALOOSA, Iowa – After years of trying to add more housing, Oskaloosa has seen a major jump in residential development. The city issued building permits for 143 housing units last fiscal year.

That’s more than seven times the usual 20 new units the city sees in a typical year.

Shawn Christ, Oskaloosa’s Development Services Director, recently stopped by the Oskaloosa News studio to talk about the city’s upcoming fiscal year 2026 annual report, housing needs, construction projects, and financial help available to property owners.

Even with the construction boost, Christ said Oskaloosa still faces a serious housing shortage.

Oskaloosa Needs Approximately 1,500 Housing Units

Christ said Oskaloosa is estimated to be about 1,500 housing units short of what the community needs.

That shortage is divided roughly equally between homes for purchase and rental properties.

This estimate comes from housing studies that examine jobs, income, available homes, rental vacancies, and how many people commute to and from Oskaloosa for work.

These studies help city leaders figure out what types of housing are needed. Developers also use this information when they apply for financial help with construction projects.

The city’s long-term goal is to add about 50 new housing units each year on average.

Christ said Oskaloosa has struggled to reach that goal during his eight years with the city.

But the 143 units permitted in the past year show a big improvement. Permits allow construction or conversion work, but not every unit is finished or occupied yet.

Several Major Housing Projects Lead the Increase

Four residential developments contributed to the increase in housing permits.

Westgate Townhomes, built by Hubbell Realty near the Trio Entertainment Complex, is meant to add more rental housing. The project got workforce housing tax credits to help keep rents more affordable.

Jefferson School Lofts is turning the old school building into apartments for older adults. The project received state low-income housing tax credits and has income limits for residents.

Christ said the development is accepting rental applications, and residents are expected to move in soon.

Another project, Northgate Townhomes, is turning the former White Oak Estates assisted-living facility into apartments.

Burrell Elite also built six townhomes near the fairgrounds, adding more higher-priced rental options to the community.

Together, these projects give people with different incomes and needs more housing choices.

Construction Activity Extends Beyond Housing

The city’s upcoming annual report will also highlight major construction investments from fiscal year 2026.

Christ said three of the five most valuable building permits were for residential developments.

Other major investments included several projects by Musco Lighting, such as work on its Product Reliability Building on High Avenue West, more office improvements, and an expansion of its facilities maintenance shop.

Renovating William Penn University’s Spencer Chapel was another major permitted project.

MidWestOne Bank also completed interior improvements as part of its move into the old downtown motor bank building.

Grants Available for Downtown Buildings and Neighborhood Homes

Besides new construction, Oskaloosa is offering financial help to current property owners to improve their buildings.

The city’s CORE Downtown Improvement Grant Program helps pay for qualifying exterior improvements to downtown commercial buildings.

Eligible projects can get up to $50,000, usually covering about half the cost of approved improvements.

The program can help pay for things like masonry repairs, roofing, windows, doors, storefront updates, and other exterior work.

Christ said the assistance is meant to help owners maintain older buildings before costly problems arise.

Unlike some earlier programs, the current grant can help with work on roofs and other exterior parts of a building, not just the front. The grant focuses on residential properties along the North Market Street corridor.

Qualifying property owners can get up to $5,000 for approved exterior improvements like siding, roofing, windows, and porch repairs.

At the time of the interview, the city had approved three applications, and Christ estimated enough funding remained to help another eight to ten properties.

City Continues Offering Development Incentives

Oskaloosa also offers property tax incentives to encourage construction and improvements.

For qualifying commercial and industrial projects, property owners can choose between a three-year, 100% tax abatement or a ten-year program with benefits that decrease over time.

Eligible residential improvements may qualify for a ten-year, 100% abatement on the increased property value, depending on program rules and exclusions.

Tax abatement lowers taxes on the added value from qualifying improvements. It doesn’t remove existing property taxes.

Christ also said the city was taking bids for two surplus commercial properties on or near A Avenue.

Historic Preservation Commission Seeking Members

Residents interested in Oskaloosa’s historic downtown can also get involved. Preservation Commission currently has two openings.

The commission reviews proposed changes to downtown buildings using preservation guidelines that protect their historic character while still allowing needed improvements.

Members usually meet once a month on Fridays at noon.

Christ said the goal isn’t to make every downtown building look like it did in one specific era, but to respect its original design while letting businesses modernize.

Looking Toward Oskaloosa’s Future

Even with concerns about housing availability and development costs, Christ said Oskaloosa is still working to attract investment and encourage improvements across the community.

The big jump in residential permits shows progress in tackling a housing shortage that has affected the city for years.

Still, with about 1,500 more units needed, housing development will stay an important issue for Oskaloosa.

Residents and property owners who want to learn about housing incentives, improvement grants, available commercial properties, or joining the Historic Preservation Commission can contact the city’s Development Services Department.

You can find more information on the City of Oskaloosa website at www.oskaloosaiowa.org.