Real estate companies and government agencies use a variety of formulas to track the cost of houses, but lately, in Athens and the rest of the country, they all tell the same story: You can’t afford to buy a house.
That’s especially true in Athens, if you’re a family making anything close to the county’s low family median income. A family making Athens-Clarke County’s median income of $51,227 has to pay 46% of its monthly income to meet payments at 5.1% interest for a house at the median price of $318,333, according to the Federal Reserve Bank—way more than the 30% of income that defines affordability.
Athens-Clarke County’s 65.6 score on the bank’s Home Ownership Affordability Monitor Index is one of the lowest scores in the nation. A score of more than 100 means a household with the median income for the county can afford to buy a median home at that 30% bar. Scores below that show how far into “unaffordable” territory an area is.
A Perfect Storm
Housing prices have been increasing sharply in Athens for years. After the collapse of home prices in the 2008 recession, prices in Athens rose at a faster rate than any Georgia metro area except Atlanta. Athens also grew in population faster than any Georgia city save Atlanta.
But the surge in house prices has accelerated to breathtaking heights during the COVID pandemic. Just five years ago, Athens-Clarke’s score on the affordability index was a much healthier 112.9, though even then many struggled to find housing because of Athens’ low wages and high poverty rates. The cost of a house in Athens is up 35% since the beginning of the pandemic in early 2020, compared to the national average of 30%, said Jeff Humphreys, director of the University of Georgia Terry College of Business’s Selig Center for Economic Growth. Much of the change is just within the past year, when house prices rose nationally by about 26%.
Using traditional economic measures, homes are about 20% overvalued nationally, Humphreys said. But the old yardsticks no longer apply—as people have spent more time at home during the COVID pandemic, they have come to collectively value home a lot more, according to Humphreys and other analysts. “In my opinion, since the pandemic started homes have become fundamentally more valuable to more people,” Humphreys said.
As the Federal Reserve Bank raises rates, housing price escalation is slowing but hasn’t disappeared—it is expected to clock in at around 12% this year. House prices could actually decline next year, Humphreys said, but not nearly as much as they’ve risen.
The pandemic is far from the only pressure on housing prices. The Federal Reserve Bank’s recent interest rate hikes, meant to curb runaway inflation, have made buying a house even more unattainable. Investors with pockets full of cash have also been scrambling to buy houses.
Krystal Seli, a children’s librarian at the Athens-Clarke County Library, and husband Phillip Gerson saw that firsthand when they moved to Athens from Oakland, CA a little over a year ago with their 3-year-old daughter, looking for an in-town house in a walkable neighborhood. They thought they’d found one in Normaltown, and then one on Pope Street, but both times investors outbid them “significantly,” Seli said.
They finally found one on Rocksprings Street, where there was less competition because of the $150,000 in repairs it needed, on top of the $217,000 price. “We found a place not many people wanted because it needed a lot of fixing,” she said.
But then they had to deal with something else driving up housing costs: supply chain disruptions and the escalating cost of building materials, when they were available. A year after committing to buy the house, they’re now about to move in, and pleased to have acquired a place before prices surged even more.
Athens was the best housing market in the state for investors in 2021, according to the website WalletHub.com, but investor buying has been high across the country. During the first three months of this year, investors bought a third of the homes sold in Atlanta—more than anywhere else in the nation, according to the Atlanta Business Chronicle.
Investor buying was a big factor when the bottom fell out of the housing market in 2008, but we won’t see a repeat this time, Humphreys said. Investors then were buying houses to flip, but now investors are more often buying houses to rent out long-term, he said. Not coincidentally, rental rates are also rising sharply.
Investor buying is nothing new in Athens, with its huge university-town rental market, and much has been in areas that were once predominantly Black neighborhoods, such as parts of East Athens near downtown and UGA. On streets such as Billups and Reese, in the heart of what was once a large Black neighborhood, more and more houses are becoming the property of landlords or young white families who want to be in the Chase Street Elementary School attendance zone. Renovated and expanded houses on The Plaza, at the edge of that district, have recently sold for more than $500,000.
Baby Boomers are holding on to their houses longer, Humphreys said, while more younger people are reaching an age where they want to buy a first house. And many workers left the construction trades after the 2008 recession and never returned, resulting in a labor shortage. “We probably under-built for a number of years, and we’re playing catch-up. We have a scarcity of single-family homes,” he said.
The decline in the supply of houses is a national phenomenon, but Athens topped the list when the New York Times recently analyzed federal data on how housing availability has changed in 300 U.S. urban areas. While many metros have a greater housing deficit than here, Athens’ shift was the largest, moving from a 12% surplus of housing units in 2012 to a negative 2.4% deficit in 2019. The housing deficit nationwide doubled in those years, according to the Washington think tank Up for Growth.
Sheer population growth, largely because of increases in student enrollment at the University of Georgia and the jobs they bring, is the fundamental force driving up land and housing costs in Clarke County, the state’s smallest county. Athens continues to rank high on “best places to retire” lists, and in 2019 Forbes pegged Athens No. 6 in the nation in a “best places for business and career” ranking. Government policies such as restrictive zoning and, ironically, the federal mortgage income tax deduction, also help make housing unaffordable for low- and middle-income people, according to affordable housing advocates.
Search for Solutions
Fixes are elusive, but local elected officials are trying. In April, the Athens-Clarke County Commission adopted the first part of a zoning overhaul meant to increase the city’s stock of affordable housing. The voluntary program offers apartment builders incentives, such as allowing more units with fewer parking spaces than zoning rules permit, in exchange for an owner’s pledge to rent some percentage of the new units at below-market rates. How it helps or doesn’t remains to be seen as planners work out the details, including how the changes will blend with Athens-Clarke’s new Tax Allocation District program to promote development in certain areas, such as the Georgia Square Mall.
A second part of the zoning overhaul, dealing with zoning for single-family homes, has yet to come before the commission and is likely to be contentious. The changes could allow some homeowners to convert parts of their houses to apartments, or could encourage builders to put up unobtrusive duplexes or small courtyard-style apartment buildings on street corners and other places they’d fit into single-family areas.
The commission could also change zoning ordinances to allow denser development in Athens-Clarke’s so-called green belt, where sewer and water lines don’t go, where some forest and agriculture remain and required home lot sizes are large. But commissioners have resisted development pressure there in the past due to concerns about the environmental impact and cost of extending infrastructure.
The commission has also put millions of dollars into redeveloping Bethel Homes, doubling the number of below-market units. At a recent meeting, the ACC Commission also discussed hiring a consultant to devise more affordable housing strategies.
Athens Land Trust Affordable Housing Director Sara Beresford believes local government initiatives can help. “I’m really interested in ways we can support smaller developers,” said Beresford, who also chairs the ACC Planning Commission. “I’m glad to see a lot of interest and money put toward the problem. I just hope we spend it wisely. It’s really tricky. I think the key is for people to have options, but the supply is so limited.”

One thing seems certain: More and more Athens residents are going to be living in apartments, rather than a house with a yard, judging from data from the ACC Building Inspection Department. In the first decade of the 21st century, the ACC government routinely issued 500 or more single-family home permits yearly; in 2004, the inspectors approved 855. In 2021, Athens-Clarke County issued construction permits for 177 single-family homes, and for 980 units in apartment buildings, many of them higher-priced apartments aimed at UGA’s growing student population. In the first six months of 2022, builders pulled 144 single-family home permits and 34 apartment permits totaling 667 units.
Students Drive Up Rent
UGA’s impact on Athens’ apartment rental business is huge and growing larger. When the apartment rental company Adobo looked at Census statistics in 2017, only one metro area in the nation had a higher percentage of people living in rental housing than Athens-Clarke County—College Station, TX, home of giant Texas A&M University. Five years later, Athens still remains one of the most renter-heavy cities in the country—No. 5 nationally, Humphreys said. According to U.S. Census figures, that rate is about 60%.
Meanwhile, UGA enrollment is on a sharp climb, on a pace lately that could see enrollment reach 50,000 in a decade or so. Enrollment was 40,118 last fall. UGA enrolled its largest freshman class ever at around 6,200 last month, according to President Jere Morehead. That would make 2022 the third straight year UGA sets a new record for freshman class size, after 5,433 first-year students in 2020 and 5,582 in 2021.
UGA opened its first new residence hall in nearly two decades this fall, 525-bed Black-Diallo-Miller Hall, limited to first-year students and named for the first three Black UGA graduates who enrolled at the university as freshmen. Beginning first-year students are required to live on campus. But even with the hundreds of new beds, UGA can’t accommodate all the students who want to live on campus after their first year. This spring, UGA offered up to $3,500 to juniors, seniors and sophomores if they’d give up their housing contracts this fall, the Atlanta Journal-Constitution’s Maureen Downey reported in May.
That’s in line with national trends. Overall, college enrollment has been declining nationwide and in Georgia, but at large state universities like UGA, enrollment grows year after year, while on-campus housing does not. And this year across the country, students who stayed home last year as the COVID pandemic built are returning to campus to get the kind of college experience they can’t get online, intensifying the student housing crunch, the Chronicle of Higher Education reported July 20.
In 2000, UGA’s 10-year plan for future on-campus housing development called for more than doubling on-campus housing, from about 4,000 apartments and dorm rooms housing 6,000 students to 9,000 units, according to a 2003 ACC affordable housing survey. But as UGA enrollment grew by nearly 10,000 in the years since, that’s not what happened. UGA did open four new apartment-style residence halls on its new East Campus in 2004 and added a fifth in 2010, for a total of about 1,900 new beds. The university also added 190 more dorm beds and a handful of apartments when it took over the Navy Supply Corps School 10 years ago, when enrollment was about 34,500.
Athens’ overall population has also grown steeply since that government report, from about 100,000 in 2000 to about 130,000 today. The Governor’s Office of Planning and Budget projects a Clarke County population of 140,000 by the next census in 2030—10,000 more bedrooms needed.

Instead of UGA building on campus, new student housing has become the province of companies that specialize in relatively high-priced, mid-rise apartment buildings like those that now make a stretch of East Broad Street near downtown Athens an urban canyon of multi-story apartment complexes housing thousands of students.
Apartment complexes now under construction or planned near the UGA campus on Broad, Lumpkin and other streets near campus will provide beds for thousands more, close enough so students can easily walk or catch a university bus to campus or the downtown bar scene, which has the benefit of keeping vehicles off the streets.
UGA and overall population growth also continues to reshape East Athens and other formerly predominantly Black neighborhoods near campus as landlords compete with families for houses.
In some cities, big universities’ growing enrollments are intensifying long-standing conflicts with their host communities, struggling to keep housing affordable, and between schools and students who want affordable on-campus housing. At the University of California at Berkeley, students have staged protests against the lack of on-campus housing, while the city government fought a losing battle against the university’s plans to build more off-campus housing aimed at students. Harvard University agreed to make 25% of 345 apartment units affordable in the first phase of its planned expansion into a Boston neighborhood, and to pony up $25 million for an affordable housing fund. Boston requires 13% of units to be affordable in large developments.
Meanwhile, rents, like house prices, are on the upswing. According to Redfin-owned Rent.com, rent for a one-bedroom apartment in Athens is up 24% over last year, to $1,386. Two-bedrooms are up 34% to $1,524, but three bedroom apartments are actually down 9% at $1,137.
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