Credit: Jeriden Villegas on Unsplash
Jacksonville has historically been a good place for people in search of housing. We’ve always ranked high on housing affordability indexes, frequently scoring as the most affordable city compared to our peers in growth and population. Part of this is geography—Jacksonville is the largest city by land area in the country, large parts of it still undeveloped—and part of it is that we make it easy to build new units. Sure, we’ve had our struggles with dense multi-family construction, but it’s fairly easy for developers to add new units should there be demand for them. In other words, real estate in Jacksonville functions like a normal market where supply meets demand.
New housing, of course, doesn’t just miraculously appear instantaneously out of thin air, and, just like the rest of the country, we’re experience a surge in demand. Median sales prices are up some 20% from a year ago, and rents are following close behind. Developers are working hard to meet demand with a range of new projects across the city, but now there’s a catch. Like every other sector in the economy, there’s a whole mess of supply chain issues and material shortages that are conspiring to slow construction and drive up prices. That’s how even one of the most affordable housing markets in the US finds itself unable to meet demand, albeit temporarily (experts say for another 12 months or so).
Now imagine you’re trying to find a home in a place that doesn’t add new units as easily as we do here in Jacksonville—where housing supply was already facing an acute shortage thanks to restrictive zoning laws that all but ban the possibility of adding new units. A good measure of affordability is share of income required for home ownership, where you take the estimated annual mortgage payments on the median home and divide it by median annual income for a particular location. For Jacksonville it’s around 25%. For Austin it’s 40%. For San Francisco it’s 65%. For Miami it’s 78%. Los Angeles tops out the list at 85%. Those cities have effectively zoned much of their populations out of homeownership. The only solution is for these cities to build their way out of it. Of course, now they’ll have to wait in line behind the rest of us.
