Column: Property boom has erupted across the region

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If Captain Obvious, a whimsical character from the hotels.com comic TV commercial, visited Gainesville Hall today, he would surely point out something that hardly anyone living here can plausibly deny.

Simply put, we are experiencing a real estate boom.

The next obvious conclusion might be that what goes up must fall. Consequently, the boom will end, as it did during the 2007-08 housing crisis that led to the Great Recession. Right?

Well, it’s not that obvious. But before we jump to any further conclusions, let’s look at the facts and trends behind this booming market, witnessed by Peach State and other local banks.

Hall County has less than two months’ supply of new and existing homes for sale. A stable housing market is usually represented by offers for periods ranging from nine to ten months.

Following the principle of supply and demand, our shortage of homes, as well as building materials such as wood, has driven property prices up.

Nationwide, the average selling price of an existing home last spring was $ 341,600 – and here in our area we are in roughly the same area. This is almost 20% more than last year.

Expansion of local factories such as Kubota, as well as newcomers such as SK Battery in Jackson County, is attracting more workers looking for housing here.

Likewise, our growing hospital and medical practices are recruiting young doctors, doctors and nurses who rent and buy new homes.

Many homes here are selling well above asking prices and buyers are lining up like bidders at an auction.

Some home buyers, especially those who move here from areas with much higher cost of living, pay all the money – simply transferring capital from their former homes.

The housing shortage contributes to the growth of rental rates here too. Monthly rental rates for some apartments are almost double what they were before the pandemic.

A growing rental market is driving the construction of new condos and condos, from the innovative Treesort community in the north end to the Crest at Flowery Branch in the south. In between, there are a variety of rental options that are popping up downtown and downtown Gainesville at The National, The Renaissance and Terwilliger Pappas mixed-use project on the other side of the downtown footbridge.

In Braselton, where our new bank branch opened, the trend continues towards retirees and people with limited ages who are attracted by the city’s first-class hospitals, restaurants and a uniquely centralized set of public services.

All this activity is enough to make you dizzy – and many wondered if our market could support it.

While we may eventually experience an economic downturn, I don’t think that will happen any time soon. And I certainly don’t foresee a collapse anywhere on the scale of the Great Recession.

We’ve learned a lot from the lessons of 2007, when mortgage rules were much less stringent and regulated. The days of shady pop-up mortgage firms offering 110% financing with little or no underwriting seem to be long gone.

At that time, we also had a huge oversupply of plots and homes for sale – unlike today. When the market began to slow down, there was a five-year glut of homes with no buyers in the market – the perfect recipe for a disaster that unfolded.

My biggest concern right now is the hint of inflation, which could lead to higher interest rates, which will slow down the business world and housing markets in the United States.

However, overall economic impact is extremely unlikely, especially in Hall County (and the rest of Georgia), due to our region’s strong, diverse and expanding manufacturing base, as well as an inland port that will soon appear in our 365 Ga highway corridor. Consumer optimism after the pandemic eases further strengthens our growth potential.

To reiterate the obvious, our boom is here, and it’s very loud. So loud that its sound should be carried everywhere for a long time.

Ron Quinn is the former chairman of the Georgia State Bankers Association and president and CEO of the local Peach State Bank & Trust.

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