The volume of good economic news coming out of Hawkins County is almost enough to make elected officials and the chamber of commerce giddy. After a decade of stagnation, a revival of industrial growth – some public, some off the public radar – is underway. Hawkins has also joined Washington County as one of the few counties in Northeast Tennessee with population growth. And, another piece of the growth formula – new home construction – is in place setting the stage for more growth to come.
Patterson-Petzoldt Build Fund LLC is reviving the Surgoinsville Allenwood development idled by the Great Recession. The developer has acquired 20 lots from the Appalachian Credit Union, and Patterson Homes plans to build new homes targeted to buyers looking to spend $200,000. The original development had 34 lots. Some of the lots were sold, but only four homes were built.
Marketing for Allenwood is being managed by Amy Patterson, Broker/Owner at Conservus Real Estate. We currently have three homes under construction – one pre-sale and two spec, Patterson said. The homes will range from 1,500 to 1,800 sq. ft. One is a one-level ranch, another is a ranch with a bonus room, and there’s two-story home. The wooded lots are one-to-three acres. The 20 lots have been resized into 16 larger lots, and while the price target is $200,000 or below upgrades are available, she added.
Travis Patterson said reception to the development has been good. “The first home in the planned development was sold before site preparation as finished.” We talking to three-to-four people a week about new homes, he added. Not all of those are for the Surgoinsville development since Patterson also builds at Old Island and Chase Meadows in Kingsport.
“A lot of what we’re seeing is pent-up demand for new homes.” New home construction is taking over since existing home sales have extinguished much of the supply of properties that were attractive to flippers, he said. “It seems to me that during the recession the focus from many buyers and owners was to fix up their homes rather than buying a new home.” But that trend has about run its course. Now, property values are rising again. According to the Northeast Tennessee Association of Realtors Trends Report, the average sales price of a single-family home in Hawkins is 20% higher than it was during the first nine months of 2016.
Patterson recently told a group of Chamber of Commerce members that at the beginning of the year he was saying he would be happy with 12 builds in 2017. “So far we have 23. I’ve never seen new construction demand as high as it is now,” Patterson said. The biggest problem we have is finding crews to keep construction even with the demand. He added that builders were also closely watching material costs. Hurricanes, trade disputes with Canada and ongoing NAFTA discussion are beginning to show in up building material costs increases.
The state Data Center’s projections show Hawkins’ population increasing at 0.5% for a couple of years. It’s not exactly a population explosion, but when compared to what’s happening in other area counties it’s noteworthy. The core issue is all of Northeast Tennessee’s counties have a death rate that’s higher than the birth rate, so migration is the only form of population increase. And that migration is not evenly distributed. This dynamic is intensified by the region’s rapidly aging population. Currently, 15 Tri-Cities residents a week are turning 65. That continues for the rest of the decade and has a significant impact on the type and cost of new home demand.
As small as it may seem modest population growth combined with job gains at Phipps Bend and new home development targeted in the price range most in demand among consumers has set the stage for Hawkins to step up as a growth leader in the Tri-Cities region in an era when some of the region continues to struggle with population losses and stagnant growth. Just this year Phipps Bend had two industrial expansions that will create 100 new jobs. Allenwood is located about five minutes from Phipps Bend.