Kelly Kenoyer: Welcome, Mouhcine Geuttabi, regional economist for UNCW, thank you for being here.
Mouhcine Geuttabi: Thank you for having me.
KK: So we've talked a bit about how population is still growing tremendously in the southeast, especially in Brunswick County. Can you tell us who's moving here?
MG: I think the dynamics are still the same. We're still seeing significant migration from Northeast in general over the last few years, it's about 50% of the people moving towards Brunswick and New Hanover coming in from other counties within the state, and the rest are coming in largely from the northeast. So Brunswick was the 14th fastest county in the country, and the fastest growing county in the state.
KK: So here in neighboring New Hanover County, I've pulled some local rental data, and what we've seen is that rents have actually seemed to flatten a little bit from what we were seeing during the pandemic. Have we finally caught up to the housing needs that we have in New Hanover County?
MG: It's a really difficult question to answer, especially in the short run, but there are a couple of things. One is that, obviously, from building permit data, for example, we saw that there was a big jump in multi-family housing construction, and I think that's helped. The other thing is that population growth in New Hanover County has moderated a little bit, and so there was this big boom in population in 2021 2022. We're still growing, not at the same rate, and at the same time, there was a big increase in supply, which we really had not seen in a number of years.
KK: So we're still seeing that population growth rising rapidly in Brunswick and Pender counties, and we're actually seeing, according to data from Zillow, rents are still on the rise in both of those counties, and are even higher than what we're seeing in New Hanover. Why is that the case?
MG: Again, I don't mean to oversimplify, but a lot of demand and supply, right? And so places that are growing at a really fast rate are going to continue to see that upward pressure. There is obviously a question of what kind of things are being built and because, as you know, those average rental prices are a reflection of what's coming online, the types of units that are being listed, and how much demand there is for them. But in general, places that are growing at a fast rate are going to continue to see their upward pressure. And clearly in some of those places, we've seen a lot of single family homes go up. Now maybe we're seeing a bit more in the multi-family front, which should hopefully put downward pressure on those prices.
KK: Yeah, that's a good point. I've actually seen new construction of single family homes specifically for the rental market in Brent County, so that could be part of the reason the pricing is higher there. I'm curious, though, will we ever again see the $700 rents that people were used to in New Hanover County, pre-pandemic?
MG: Crystal ball says no, because the industrial composition of the area has changed quite dramatically. In other words, we have a lot more higher paying jobs. Population has grown quite a bit, and then when the labor market grows, a portion of the individuals that take these jobs are coming from outside, which means there is this continued pressure on housing prices. And for New Hanover specifically, clearly there is not a lot of undeveloped land. And so I think everything says that yes, will rent growth moderate? Yes, will we see the jumps that we saw during COVID likely? No. But will we be walking backwards? I think that's very unlikely, just like it's unlikely that we're going to somehow see prices of things in general, fall by the 20 or 25% they've gone up by over the last five years.
KK: I know that we've seen average median incomes here in New Hanover County rise since the pandemic, and that can be attributed partially to people moving in for higher paying jobs, but we also know that a lot of lower income residents are leaving for different places. I want to know if you think there's a way that we can protect the local residents who are still here, especially those who are lower income, maybe in the service industry, so that they don't end up displaced.
MG: I think that that's a really big economic development question, and it's an appropriate one, especially at a time when we're growing really fast. We need to be thinking really deliberately about upskilling. You know, who potentially is taking some of these jobs, especially the higher paying ones, meaning playing matchmaker between the areas that are growing, that are paying well, and the residents that already live in the area. And then the other point to this is housing supply needs to keep up with this demand that we've been seeing, and we need to be building all sorts of type of construction that hopefully meets the needs of a lot of different individuals along the distribution of income and ability to pay well.
KK: Thank you so much for coming by, Mr. Geuttabi, it's a pleasure talking with you as always.
MG: Thank you for having me.
