The long tail of economic uncertainty born from the dog days of 2020 has left a lingering stagnation in the housing market, with high interest rates and skyrocketing insurance premiums leaving many formerly high-ticket homes with sun-faded for-sale signs and no prospective buyers.
With home sales the lowest since the housing crisis of 2009 and no salve to the recent global economic chaos in sight, Northshore builders, real estate professionals and homeowner advocates are doing their best to spurn spending, looking to Baton Rouge and Washington D.C. for assistance while a potential recession looms.
“Developing ourselves out of this situation is one solution,” said Michael Saucier, founder/owner/president of the Gulf States Companies, a real estate, development and construction company. “We just don’t have enough businesses on the Northshore, and interest rates are certainly an impediment to bolstering commercial construction and housing.”
Not only has residential home buying gone stagnant, but in St. Tammany and Tangipahoa parishes, expansion has also run cold. Apartments currently make up only 11% of housing options, far below what Saucier indicates is the healthy level of 25%.
“To retain growth, there has to be a certain number of rental properties for young people getting out of college who can’t afford to buy a home,” explained Saucier. “If there’s no inventory, they’ll live somewhere else. So even if the Northshore economic development organization attracts industry to set up shop, they do not currently have a healthy mix of housing to meet that demand.”
Kentrell Jones, executive director of East St. Tammany Habitat for Humanity, sees the aftereffects of this crisis firsthand.
“Resistance to higher-density developments has limited some of the pace and scale at which new housing can be built, along with rising construction costs,” said Jones. “Rising material and labor costs have made new affordable development more expensive. There are also many families at risk of losing their homes, with mortgage payments often increased to more than 70% of an individual’s paycheck.”
Mike Cassesi, founder/owner of Cassesi Construction, has made a name for himself in both historical restoration and new construction builds across Greater New Orleans. He said he has witnessed the urbanization of the Northshore for more than two decades. While doomsday is not his prediction, he said Cassesi Construction has learned its lessons about weathering economic firestorms, having navigated the COVID years as a brand-new company.
“I’ve seen firsthand the influx of population to the Northshore over the years and think the demands of infrastructure for everyone living there have been well met, with larger projects and developments trickling down to a community level,” he said. “With larger entities moving into the region, like Amazon, I believe the development to maintain, and even increase, the working population of the Northshore is remaining strong.”
For Northshore homeowners, however, its all about insurance costs.
Andreanecia Morris, president/chair of Greater New Orleans Housing Alliance (GNOHA), advocates for homeowners throughout the region whose houses have been left damaged by rain, wind, or even snow due to the rapidly expanding climate crisis. Selling a house in the current state of the economy is hard enough; trying to do so while living under a tarped-off roof, while insurance refuses to lend assistance, is nearly impossible.
Morris and GNOHA are leading efforts to incentivize fortified roofing, a proven balm against the ravages of a chaotic climate and crippling insurance premiums.
Bills are currently before state legislatures that aim to guarantee discounts for homes with fortified roofs alongside tax cuts to help homeowners with insurmountable premiums pay their way out of stifling debt. These efforts, supported on both sides of the political aisle, could cauterize the economic bleeding and create stability for Louisiana that can be used to buttress investment and growth. The main hurdles, according to Morris, are predictably political in nature and short-sighted in practice.
“Insurance Commissioner Tim Temple and Gov. Jeff Landry are playing dangerous games by focusing on auto insurance when property insurance is a critical issue,” said Morris. “Meanwhile, Bob Owens, Republican state senator and member of the Northshore delegation, is wasting millions of dollars sponsoring a bill to create a homelessness court while his constituents, who literally cannot keep a roof over their heads, are living in barely habitable homes themselves. Folks are waking up to this reality, and the people on the Northshore are beginning to do their part to pressure their elected representatives to act in their best interest through realistic, effective reforms.”
Jeremy Marshall was born and raised in Baton Rouge before moving to New Orleans with his wife, Kristin, in 2018. Beginning his career in the film/TV industry, Marshall worked steadily on over a dozen projects before transitioning to Renaissance Publishing as sponsored content coordinator. He may be reached via email at jeremy@myneworleans.com.
