Home sales in Lee's Summit, Mo., struggle to recover

— -- As in many Middle America suburbs, the pace of development in Lee's Summit, Mo. — 16 miles outside Kansas City— has slowed dramatically after a decade of growth.

"We had a major, major boom," says Realtor Diana Frank of Keller Williams Realty. "We couldn't build (houses) fast enough."

That's no longer the case in Missouri's sixth-largest city.

"Maybe we have been building too much," concedes Heping Zhan, manager of long-range planning for the city's Planning and Development Department. "With the recent economy and housing crisis, new construction has dropped significantly."

May sales of existing single-family homes fell 40% from a year ago, while construction of new homes dawdles in the white-collar suburb. Foreclosures and short sales also are becoming more common, Frank says.

Lee's Summit currently has 87 foreclosures, according to RealtyTrac.com.

And prices have been reduced, an average 7% off the original asking price, on 23% of 892 non-foreclosure homes on the market, reports Trulia.com.

"There has been an increase in vacant homes, so choices are many," Zhan says, "especially for a first-time home buyer."

The western Missouri suburb typically draws a higher-income home buyer because there is no mass transit, Frank says. Lee's Summit's median household income in 2007 ($72,283) was nearly double the average in Kansas City and well above the state average ($45,012), but only 25% of its residents work inside the city limits, according to the Lee's Summit Economic Development Council.

The local economy, driven by the Lee's Summit school system and medical centers, is strengthening, Zhan says, but many workers still commute to Kansas City and other parts of the metro area.

Ranked 79th in CNN Money's 100 Best Places to Live in 2008, Lee's Summit attracts many families with its schools (rated seventh in the country on CNN's list) and nearby lakes, says Frank, who moved there 15 years ago for those reasons. "I think (the housing market) will slowly come back," she says.