JOHNSON CITY, Tenn. (WJHL) — The numbers don’t lie, and in the case of new home construction in Johnson City, they tell a story of growth during the pandemic.
Single-family construction permits surged from 71 in the first nine months of 2019 to 124 through the same period last year and 149 through September of this year.
The total estimated value of those homes also more than doubled, rising from $16.9 million in 2019 to $23.4 million in 2020 to $35.3 million so far this year.
Johnson City Development Services Director Preston Mitchell gave city commissioners a synopsis of overall building permit data earlier this month. Mitchell told News Channel 11 Friday several things are contributing to the strong home construction growth.
He said financial markets are favorable to developers accessing capital, but that’s a nationwide advantage. Locally, Mitchell said factors people have talked about for years are really beginning to come into their own.
“It kind of falls back to the quality of life question,” Mitchell said. “I think that the God-given assets we have here, the climate that we have here, the low cost of living that we have here, the recreational assets that we have here are second to none.”
That’s been touted for years, though. Mitchell said he thinks the COVID-19 pandemic created some societal forces that have made it easier for Johnson City and areas like it to capitalize.
“I think it’s interesting because the pandemic has, for lack of a better term released people from larger metro areas,” Mitchell said.
“Maybe they have thought about working remotely or … that’s just been a discussion in the back of their mind, and now they’re making the decision. ‘You know what we’re going to do this now — we’re going to leave the Charlotte metro area or we’re going to leave the Atlanta metro area or Nashville, and we’re going to go live in that area that we talked about doing for the last five, six years.'”
Mitchell said the influx isn’t just from larger metros around the Southeast.
“Folks are coming from the northeast and coming from California and from the Far West. So, I think that speaks to quality of life. I think that speaks to our environment, and it’s just a great place to be right now.”
Mitchell gets no argument from Pat Weber, a developer who owns Ingenuity LLC and has taken advantage of the boom himself. Weber cited the area’s quality of life, beauty and four seasons as well — but also pointed to what he said was a great economy in Tennessee.
“Three years ago if I told you that we’re going to have a pandemic, and then immediately after … in the middle of that we’re gonna have a housing boom, everybody would have told me I was crazy,” Weber said.
He said, “people are looking for places that are just a better, more spread out place to live and just to kind of change your environment because of all this.”
Weber doesn’t expect the trend to abate anytime soon.
“The pandemic is phasing out, but people still started this trend to come to East Tennessee and it’s like as long as they can sell their product in other places, they’re going to be coming here to enjoy this lifestyle,” Weber said.
What could slow the roll?
Weber said the only hitches in the giddyup right now are difficulty finding enough subcontractors and supply chain issues that make it difficult to keep sufficient materials on hand.
“We definitely need a lot more skilled subcontractors,” Weber said.
“You can just go ahead and pick whatever one you want,” he added. “We just need more of everybody to keep up with the demand because we’re not doing it.”
As a result of both issues, Weber said, he doesn’t market houses until they are nearly complete.
“We could get to the end and have something that just stops us and we can’t even finish, you know, or delays it for two weeks or two months or whatever.”
Weber also said the city needs to be “welcoming” to developers and to maintain an adequate supply of lots and land available for building.
Mitchell said the city’s development services arm, which has come under criticism for not being as “customer friendly” as it could be, has been working to change that image. If they’re not successful, that could impact growth even if all other factors are positive.
“The developers that we work with on a daily basis, whether they’re whether they be local or out of town developers, they are happy to go start projects elsewhere, if they’re going to get the customer service that they demand,” Mitchell said.
“And so government has to change how we’ve been doing business in the past and we have to be responsive to the fact that time is money for those folks.”
Mitchell said the “culture change” has been successful so far, including “empowering people to tap into their talents and assets that they bring every day.”
“Despite the successes we’re seeing, we have to be responsive to that customer service demand. And so that’s easy to mess up, but it’s also not rocket science, and it’s fairly easy to fix.”
As far as available property, Mitchell said the city’s blessed to have both ample “greenfield” land available — where water and sewer and other infrastructure has to be extended — and “infill” lots in the city’s core where infrastructure already exists.
Mitchell said he’s not surprised the area is experiencing economic and housing growth as well as in-migration from all over the country. He worked in North Carolina for 15 years and saw rapid growth there.
“That is kind of cresting over the mountains now on this western side,” he said. “I think that tidal wave is — we have yet to see the peak.”
Even if the financial markets change and access to capital gets more expensive through interest rate rises, Mitchell is confident.
“I think despite what happens with the financial markets, people themselves will continue to move to this area because of our quality of life, because of our God-given geographical assets. And so I look forward to being a part of that.”
“I think the boom in Johnson City will keep going,” he said. “The teens were great, but I think the ’20s will be even better.”