The top line statistics tell us things are good. Last week, Georgia’s unemployment rate hit a record low. Georgia has more people working than ever before.
The state’s economic success continues to attract new residents and new employers alike. About 100,000 new people are calling Georgia home every year, adding nearly one million to the state’s population in the last decade.
A decade ago, Georgia was awash in excess housing supply in the aftermath of the housing bubble bursting. There were dire predictions that some developed lots would never be built upon. Some wondered if the real estate market would ever come back and if buyers would ever see housing as a sound investment again.
New supply of single family housing has been slow to return to the market. Some areas, particularly in Atlanta and its northern suburbs and along coastal Georgia have returned to the boom days of real estate. It should be noted, however, that these areas contain much of the state’s higher priced homes.
Other areas of the state have not yet seen a return to single housing construction. Georgia lost 25 percent of its banks in the aftermath of the housing collapse and big-bank bailouts. These were often the source of smaller homebuilders’ loans for construction.
A decade later, things have changed. Demand for housing is there, but the market has many challenges in matching supply to that demand. State leaders are starting to focus on the reality that a lack of housing supply – particularly in the entry level price points – is a barrier to the state’s economic and employment expansion.
The Georgia House spent much of the summer and fall looking at the issue of housing affordability and supply. A study committee chaired by Representative Vance Smith of Pine Mountain heard expert testimony from economists, realtors, bankers, and those in the construction industry on the challenges of delivering more affordable homes.
Workforce housing issues are generally discussed in terms of metro areas, where gentrification and a shift toward living close to work have dramatically bid up property values and rental rates in big cities. The working poor, usually renters, have great difficulty finding housing within their budget and often lose the housing they may have had due to rising rents or redevelopment of their property.
Housing affordability has a uniquely rural component as well. Unlike Georgia’s growing metro areas, much of the rural areas of the state are not seeing any significant construction outside of student apartments in college towns.
Those making decisions to build new factories or other employment centers often start with the question “where will our employees live?” Too many Georgia communities that would otherwise have the land and other resources employers are looking for don’t have an answer to that question.
Realtor Frank Norton Jr of Gainesville testified to Smith’s study committee that the state is currently lacking at least 300,000 housing units needed to supply workforce housing needs. Compounding the problem is that the state is producing housing at the same levels as the 1970’s, while demand is increasing in numbers the state has never experienced. The result is that prices have almost doubled since 2011, which compounds the problem for those at the entry level of the market.
Some solutions will focus on the side of regulation, where design standards and extraneous additions to building codes are pushing up development and construction costs with little actual benefit to the housing structure. A battle is brewing between state leaders that see the barrier of affordable housing as limiting economic growth, and local leaders that are implementing design standards to inflate property values while practicing exclusionary zoning.
Other solutions will include focusing on mortgage underwriting standards. Because of historically low mortgage rates, many buyers could actually pay less on a mortgage than they pay in rent. Entry level buyers often still exceed total debt ratios needed for mortgage qualification, even though they would be improving their household cash flow moving from renting to owning.
Legislators will spend the next couple of weeks at home for the holidays. When they reconvene in Atlanta in January, expect a renewed focus on policies that help or hurt the ability for working Georgians to own their own homes.

Charlie Harper is the publisher of, and the Executive Director of PolicyBEST, which focuses on policy solutions in the areas of Business Climate, Education, Science & Medicine, and Transportation.