A new report on real estate trends shows downtown Columbus outpacing New Albany and Easton as the most popular place to live in Central Ohio.
Jung Kim helped to gather data for the report. Kim is the Managing Director for Research and Business at Columbus 2020. We called him to find out more about upcoming real estate trends in the area.
Jung Kim says in the short term the Central Ohio real estate market looks strong. Kim is a Managing Director for the economic development organization Columbus 2020.
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Marilyn Smith: Let's tackle the big picture first. Homeowner rates apparently continue to fall while rental, rentals are up. Break that down for us you would think it would be the opposite. Jung Kim: I think there are few things going on. One is or was the economy and the recession. You know the effects of that including foreclosures. So homeowner rates dipped at that time because of that. And I think to some extent people are saying that for sale residential is starting to recover. It's, it's nowhere near the heights that it was back in the ninety's and early two thousands. The other things that is going on is the underlying demographic trends. You know as you have baby boomers increasingly becoming empty-nesters and approaching retirement and millennials. There's just less demand for larger single-family homes and more interest in smaller units. So I think the other thing that's happening is that there's a preference for some consideration for renting for a longer period. MS: Even though rents are up? JK: It'll be interesting to see what happens over the next couple years rents are up here in Columbus and in other markets. Some of the people we surveyed and interviewed are started to get concerned about whether we'll hit a limit. But you still see development happening around downtown and other central parts of Columbus that are filling up pretty quickly. You know as they put up more and more rental apartments. So I think that for now the market seeing that the supply is being met by demand. MS: As you mentioned there is a supply downtown and in fact the report found that downtown Columbus ranks number one among central Ohio submarkets overtaking Easton and New Albany. Was that a surprise to you? JK: I think a lot of that sentiment is based on the activity. The volume of activity that people are seeing in downtown and some of the other places that saw their scores rise this year, Grandview, Dublin, I think it reflects what's happening there. The interviews and their comments only certainly validated that. There's a lot of interest in urban living or urban-style living. So I think it all meshes together. MS: Do you think the tax abatements had a lot to do with that especially downtown Columbus? JK: The tax abatements were probably important catalysts ten, fifteen years ago, just to get downtown going. And interest amongst the development and investment community. But in the past few years I think downtown has had a momentum of its own and it hasn't really needed to rely on those kinds of incentives. So market force is at play. MS: One of the other interesting things you found was that the workforce has become a major point of pain with shortages in construction and in skilled trades. Do you see any correction? JK: You know if you're thinking along the lines of a market, you know hopefully the rising wages and demand will encourage more people to enter the workforce into those occupations. Part of the problem that we're seeing today is that in the recession a lot of people in the skilled trades and construction and they move to other markets where they decided that they were tired of this boom and bust of the real estate market and switched occupations. And now that, as we see the economy recover, the real estate market recover, we're facing some of those pressures now. MS: Can you draw any conclusions from this report itself in terms of transportation needs for the future or retail needs for the future? JK: We did ask about transportation needs including on the job Access Front. And I think people felt pretty positive about some of the best practices that are coming out of New Albany and their business park and down at Rickenbacker but still it's ongoing concern because we don't have a broader plan or, or contacts for what to do about transportation. Right now we're in a situation where we've been fortunate with traffic and parking issues that aren't too bad compared to other markets. But as we continue to grow especially in certain neighborhoods that are seeing a lot of development I think people are starting to raise those issues. MS: Jung Kim thank you so much for your time. JK: OK thank you Marilyn.