By. Neil Williamson, President
Did you ever have a question gnaw at you?
Earlier this month, I attended the Charlottesville Area Association of REALTORS® Development Summit. A panel of area developers were discussing Charlottesville Regional Chamber of Commerce’s recently released 2018 Jobs Report and attempted to correlate how job creation related to the local housing market. Absent any specific data, the panel inferred the new jobs in the region clearly were one (not the only) driver of housing demand.
Reaching out to each of the localities (two required Freedom of Information Act (FOIA)Requests) we assembled the new housing unit data (2007-2017) and compared it on a locality basis the Jobs report data for the same study period.
As of 2017, the cumulative number of new jobs since 2007 is growing closer to the number of new housing units created in the same study period.
There is a distinct lack of correlation between the number of jobs created and the number of new housing units. Even when the region was losing jobs in 2009, there were over 900 new housing units created [It was the lowest number of units in the study period].
This line of inquiry led to considering the other significant impacts on the housing industry beyond Jobs. The enrollment at the University of Virginia for instance increased by 2,408 students from 2007-2017. Regionally the population increased by 30,633 persons. Overlaying The Weldon Cooper Center’s population estimates with our other gathered data started to prove the population demand driver.
Examining the introduction of the population trend line leads to a number of new questions:
- In 2007, just prior to the Great Recession, how many excess units existed before our study period?
- If our regional household size is ~2.4 persons (US Census), then new housing units should equal 41.6% of the population growth. In those areas with higher than 41.6%, likely have a lower number of persons in the household.
- Considered on a locality basis, job creation does not have a direct correlation to new housing units. We anticipate this lack of correlation is related to the relative ease of working in a different locality than you reside. Louisa and Orange Counties seem to have the closest direct correlation between job and housing creation.
- Anecdotally, we continue to see an increase in the number of retirees relocating to the region. While retirees are included in the Weldon Cooper population information, we have yet to find an objective metric to track this data separately.
Dissecting this decade of data (2007-2017), we again end up with more questions than answers.
But often, the best questions drive the best community discussion.
Neil Williamson, President
Neil Williamson is the President of The Free Enterprise Forum, a public policy organization covering the City of Charlottesville as well as Albemarle, Greene, Fluvanna, Louisa and Nelson County. For more information visit the website www.freeenterpriseforum.org