Navigating the American Geo Shift

In recent years, several regions in the United States have experienced significant increases in property values and shifts in population. Factors such as job opportunities, lifestyle preferences, infrastructure development, and local economic conditions, including active Economic Development Corps (EDCs), all contribute to positive shifts in property values and population. Much the same as negative conditions – unemployment, homelessness, poor education, lack of economic growth, high income/property tax rates, and crime – contribute otherwise.  A separate, but related issue is the influx of immigrants from the South, which until recently was a southern border issue, but with bussing, this has expanded to put strains on other markets to the north.

Here are a few geos that have witnessed notable changes:

Sun Belt States

The Sun Belt region, which includes Florida, Texas, Arizona, and Nevada, have seen substantial population growth and property value increases. The warm climate, previous affordable housing options, and economic opportunities have attracted many individuals and families to these areas. Cities like Phoenix, Austin, and Tampa have experienced significant population growth and rising property values as a result. 

At the same time, it’s worth noting that the climate change is impacting these cities in different ways. Phoenix is experiencing record temperatures causing major challenges to the electrical grid. Florida, with its increases in catastrophic storms has seen dramatic increases in residential and commercial insurance costs, with rates quadrupling in some cases, coupled with insurance companies exiting the Sunshine State.

Pacific Northwest

Metropolitan areas in the Pacific Northwest, particularly Seattle and Portland, have seen remarkable increases in property values and population shifts. These cities have become hubs for technology and other industries, attracting professionals seeking job opportunities and a high quality of life. Limited housing supply and strong demand have contributed to soaring property values in these regions.  As is the case in many cities, homelessness is taxing the infrastructure causing values to decline in downtown areas, including Portland.

Mountain West

Cities in the Mountain West region, including Denver, Salt Lake City, and Boise, have also experienced notable growth in property values and population. These areas offer a combination of outdoor recreational opportunities, a favorable business climate, and a relatively affordable cost of living compared to some coastal regions. In the past twelve months, however, the population shift, and housing shortages have created a new problem, thus construction for first time homebuyers and multi-family has exploded in these areas.  This region has attracted individuals and families looking for a more balanced lifestyle. Denver, in particular is under the microscope as the city’s leadership examines the negative change to their affordability index, which was expected to slow the influx, but to date, has not.

Coastal Cities

Certain coastal cities like San Francisco, Los Angeles, and New York City have historically seen significant increases in property values due to high demand and limited supply. However, these areas have also experienced population shifts as housing affordability challenges have pushed some residents to seek more affordable options in neighboring regions or secondary cities. During the pandemic, most employers permitted people to work from other locations and many saw this as an opportunity to relocate. Those exiting coastal cities find affordability in neighboring states, depending on their expectations, requirements and perspectives.

How Will Employers Cope in the Environment

These real estate trends pose a nagging question for employers — whether requiring associates to work more from the office will impact the morale, compensation levels, and the ability to attract the brightest millennials to their companies. Most polls show that hybrid is here to stay and those organizations that cannot adapt will fall behind in the talent race over the next five years. “Better together” is a great slogan with a level of merit, but it can also be a double-edged sword.  Benefits like a 401K match, great insurance, paid time off for charitable work, and flex PTO don’t cut it anymore. Add the continued inflation concerns and the cost to raise a family and acquire childcare will continue to push associates to seek work from home or hybrid opportunities to limit their financial exposure.

Are you ready to manage long-term in this environment, or perhaps you’re considering other ways to lure associates back to the office to stave off increases in retention challenges?  Even a combination of paths could be deployed, but my belief is that old school views of top-down decision-making for this will need to yield to the associate advisory groups (ARG’s) that will help to keep companies informed and on-track with upcoming trends that the generational requirements will be, not just for millennials (Gen Y), but also for the Gen Z group that is entering the workforce now.

How can mortgage players elevate employee satisfaction without losing sight of efficiency and productivity in this environment? The answer lies in effectively blending technology solutions with human capabilities and revised processes to enable better and faster training when tenured associates are not in the next cubicle to answer a question. There are digital solutions to promote collaboration, improve efficiency, and increase agility in a hybrid work environment, with more being developed every day. Partnering with a third-party provider who brings a sound technology focus and the required mortgage services can help organizations walk the tight rope – effectively catering to evolving associate population desires while driving operational excellence.

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