Lonely house symptom of long recession

MORGAN COUNTY, Ind. (WISH) - As we first told you last week, new home sales rose a little more than 3 percent in April nationwide, with sales in the Midwest jumping 28 percent.

It's a sign that the battered and bruised housing industry may be slowly recovering.

But in Morgan County, there is a place that illustrates the nightmare of the economic catastrophe of the past five years: an 80-acre subdivision that has only one house. It’s a place where you'll see the tiny sparks of recovery, though, that keep the dream alive.

At first, the Oak Hills subdivision on the Morgan County side of the Morgan/Johnson county line doesn't seem the least bit unusual.

"I mean, I loved it. I was down here every day working on things, laying it out," said John Schmitz, developer of the subdivision.

It was late 2007 when Schmitz, owner of a successful masonry business, developed the piece of property and was ready to sell the lots to custom home builders.

"Gas went to $4 a gallon, and we had all the financial scandals and banks going after collateral. It just, it just - I couldn't give a lot away. I honestly couldn't give one away," he said.

On the hook for a loan of $2.5 million, Schmitz said his faith kept him going.

"I spent my 401K paying interest. Sold properties to pay interest. Basically fought until the last things I have. And I just have to go back to my faith," he said.

Schmitz's American dream, became a five-year nightmare. Only one lot was sold, and one house built.

"It's a nice thing to have neighbors. I miss them,” said Linda Owens, sitting on her back patio, looking out on empty streets and vacant lots.

Linda and George Owens moved from New Jersey to be near family in Franklin. For nearly four years the retired couple has been Oak Hills’ only residents. But because the cost of building a house in Morgan County is so much less than the cost of living in New Jersey, the Owens didn't have to take out a mortgage.

While they worry about their property value, they can wait for a recovery, said George Owens.

"I can sit here for 10 years, 15 years, waiting for things to go up. I don't have to worry about if I am going to get a job, or if I am going to lose a job or something like that. So that doesn't bother me that much," he said.

And slowly, there are signs of recovery. Sold signs, put there by realtor Fred Nelson of Century 21 Scheetz.

"We're starting to see some activity. We've got a couple of closings coming up. We have one person who will start builiding out here in, we think, three weeks," Nelson said.

Schmitz said he can survive Oak Hills about another year.

"It's getting close. This is now the time that I need to get some action," he said.

Other positive signs for Schmitz include the latest home sales numbers for central Indiana, showing Morgan County leading the way with an increase of 11 percent. And for the first time since the debacle began, Schmitz said his bank is willing to negotiate on the terms of the loan. That’s something unheard of, he said, even six months ago.