Housing Valdosta

Home prices have steadily increased in South Georgia and while prices remain lower than metro Atlanta and other larger cities across the state, rising prices across the nation are making it more difficult for new home buyers, housing professionals said.

ATLANTA — Groups studying the housing market are urging state lawmakers to change zoning laws to provide more affordable homes that match space demands, especially as homes under $300,000 are in demand but much smaller than decades ago.

“The price points above ($300,000) have actually held up okay even in the midst of rising interest rates,” explained John Hunt, principal of MarketNsight — a company that provides market research to the home building industry. “It’s anything below 300 grand that has not been there. We don’t have that inventory to sell at all. So that’s what we’re missing— affordable, workforce housing. I would call it a starter home price point. Three hundred grand is not cheap but it is today’s starter price point.”

The Georgia House Study Committee on Regulation, Affordability and Access to Housing held its first in a series of day-long meetings Sept. 28 to hear from various entities involved in housing— from analysts, builders, economists, and policy groups.

Several of the presenters agreed that the housing affordability issue is being waged by an increase in material costs, interest rates, inflation, labor costs and permitting fees.

“It’s also being waged by restrictive and exclusionary zoning that keeps us from building the price home that many people could afford,” Hunt said. “It’s been in our system for 100 years, and I think it needs to be addressed. I think our current zoning is based on the way the world looked 20 or 30 years ago.”

Worsened during the COVID-19 pandemic, the country has been in a housing crisis since the recession.

But specifically middle-sized homes in many areas of Georgia and the country aren’t being built anymore as needed. Housing analysts and researchers call it “The missing middle.”

The market lacks mid-sized homes, which are typically desired by millennials looking to leave multi-family, smaller-sized housing, Hunt explained. Many Baby Boomers, who typically now own larger homes, want to downsize but also aren’t able to find the mid-sized home many of desire, he added.

Millennials are 37% of homebuyers in the country at the bottom and the Baby Boomers and Gen Z at the top.

“The smallest consumer group is the one in the middle which is what most of our zoning is still focused on: single-family detached, big yard … The people on the bottom and the top are kind of left out in terms of product availability,” Hunt said.

Townhomes, triplexes, bungalow apartments or mid-sized homes between 1,200- 1,700 square feet are less available but more desired for starter homes, which are now estimated at $300,000; Twenty years ago, that was approximately $150,000.

Most current zonings force the building of homes over 3,000 square feet and the price of those homes are well over $400,000. Zoning in most areas hasn’t changed in decades, requiring home sizes to still meet that requirement, so many areas are stuck building smaller-sized homes in an era where building costs are high, Hunt explained.

”I would say that artificially restricting supply through exclusionary zoning is driving prices beyond people’s budgets,” Hunt said.

“I think that’s evident and that’s for sale or for rent and they’re both big parts of the market. Roughly 40% rent 60% for sale or owner occupied and the restrictive zoning is upping prices for both. and in the long run, I think this is greatly going to impact Georgia’s ability to track inventory of new investment and industry.”

Emily Hamilton, of Mercatus Center at George Mason University, said local zoning rules are standing in the way of starter home construction.

She referenced Houston, Texas where leaders reduced the minimum lot size requirements from 5,000 square feet down to 1,400 square feet, initially around the urban core of Houston. Based on the success of the change, they expanded it to cover the entire city as a whole.

”This lot size reform has made it possible to build small detached houses or attached townhouses across a broad swath of cities,” Hamilton said.

“In Houston, the median home price is a little over $300,000 today, which is below the national median. It’s $100,000 less than the median home price in the Atlanta metro region and I’d argue that permitting this small lot development is a big part of of that lower median price.”

A representative for Habitat for Humanity said more people entering in home ownership has better overall outcomes on the wellbeing of a community.

Referencing a survey of 1,000 lower-income people who purchased a home through Habitat for Humanity, he reported that homeownership overall has resulted in improvement in their health, well-being and financial stability.

The majority of them reported decreased reliance of government assistance, 95% of them reported feeling safe or “very safe” in their homes and 74% said they were confident or very confident in being able to fund their child’s college education.

He suggested creating flexible zoning options, a state-funded loan pool for downpayment assistance, tax credits for businesses that contribute to affordable housing.

React to this story:

0
0
0
0
0

Trending Video

Recommended for you