The Real Economy

Steady and conservative: The Nebraska Way

David Gura Jan 31, 2012

Kai Ryssdal: Obviously you have to have a certain something to thrive in Nevada, a tolerance for the economic booms and busts. In other places, though — a lot of other places — it’s all about the even keel. Not getting too excited when things are going well, which helps when things elsewhere start going bad.

Here’s Marketplace’s David Gura from Wayne, Neb., population 5,600.

David Gura: Main Street cuts right through the center of this town, and this ain’t the strip. There’s a movie theater on one end and a dollar store on the other. A small real estate agency sits catty-corner to a bank that was founded here back in 1892.

Trisha Peters is a broker at 1st Realty. She says things slowed down some, in 2008. She’s seen a few homes in foreclosure. But not because the owners were gambling on the housing market:

Trisha Peters: We weren’t going crazy with building.  People were staying in their homes.  They were trying to improve what they had.

Wayne is a farming town — and a big one by Nebraska standards. There’s a college here and a few factories. Peters says home prices have been stable. If you wanted to flip a house, this was not the place to do it.

Peters: Due to the size of our communities around here, people know when somebody buys a house for $80,000, and if they tried to turn around in six months from now and list it for $180,000, they would know something’s up.

There really wasn’t a housing bonanza in Nebraska, and because of that, there wasn’t a housing bust. According to RealtyTrac, last year, only seven states had lower foreclosure rates.  In this part of the country, if you want a loan, you’ll need equity.

Peters: Our banks are pretty strict.  You know, we’ve got some pretty straight shooters.  Most of my clients are going through one of the four local banks here, in the Wayne community.

The Midwest Land Company is right across the street. Marion Arneson is the owner.  He’s a farm manager and a land broker, and there’s a deed on the wall to a piece of property that is still in Arneson’s family, he tells me, four generations later.

Marion Arneson: You can talk all day, but Nebraskans have been through blizzards. They’ve been through heat. They’re strong-willed, pioneer stock. They’re going to have a couple down years — they just come back.

Arneson’s clients are farmers, and their line of work is cyclical.  Mark Landow is a political scientist, and a Nebraskan, born and raised. 

Mark Landow: When farmers have a bad year, it has a tremendous effect on the rest of the state.

And when farmers have a good year, that has a tremendous effect, too. This is, after all, the Cornhusker State.  They’ve had a string of good years. The price of corn, the price of soybeans: they’re through the roof.  And farmers are making a lot of money.  But the ones I talked to seemed so modest.  

Landow: I think we see just a general conservatism — a general unwillingness to bite off more than you can chew — that is sort of the hallmark of the Nebraska personality.

Landow says that’s what’s called “The Nebraska Way.” 

Landow: That’s the way we do things out here. We cooperate. We get together. We work things out. 

Heritage Homes has a factory in Wayne, about a mile from Main Street. The company builds modular homes and ships them to states that aren’t doing as well as Nebraska. It’s a tough line of work to be in.

Darrell Miller: Housing usually leads us into a recession and takes us out, but it just doesn’t seem to be working quite as well that way.

That’s Darrell Miller, who co-founded Heritage Home in 1978. Last year, sales were down 40 percent, and there were layoffs. Competitors went out of business. But Miller has his eye on North Dakota, where there’s an oil boom. And he’s optimistic about the market.

Miller: We know it will come back. It just does.

That’s “The Nebraska Way.”

In Wayne, Neb., I’m David Gura for Marketplace.

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