A moratorium on development in Horry County would take a significant toll on the local economy still rebounding from the 2007 recession and cut off construction wages that total hundreds of millions annually.
A judge will decide Oct. 14 whether to issue a restraining order to cease all new residential and commercial construction because of flooding concerns, which were cited in the petition signed by nearly 1,000 people and filed in the Horry County Court of Common Pleas.
While some blame too much development for causing Hurricane Florence flooding, the pace of construction and its economic impact haven’t fully recovered from the housing slump that followed in the wake of the 2007 recession.
That’s according to U.S. Census information provided by Robert Salvino, a professor of free enterprise at Coastal Carolina University.
To illustrate the decline and gradual recovery of development, Salvino also compared new housing construction permits issued before and after the recession collected from Horry County Code enforcement reports.
In the 1990s, an average of 180 permits a month were issued for new home construction in Horry County
But building was booming in 2006 before the recession hit with as many as 800 permits recorded in one month.
“That was the peak, then it started to fall,” Salvino said.
In the 2019 fiscal year ending in June, a total of 2,967 permits were issued, Salvino said.
That’s an average of 247 a month.
“A moratorium is certainly going to reduce construction,” Salvino said.
If new development comes to a halt, so will construction wages that support thousands of families.
Before the 2006 recession, commercial and private construction wages totaled more than $410 million in Horry County, but the recession reduced those earnings to just under $167 million by 2011.
By 2017, construction wages had climbed back to almost $307 million.
“Over time, that’s a huge loss,” Salvino said.
The call for a moratorium on all construction comes as the Horry County Council is working to pass a comprehensive new plan to guide future land use and development for the next two decades called Imagine 2040.
That plan predicts Horry County’s population will grow from more than 344,000 to nearly 585,000 by 2040, requiring more than 116,000 additional housing units.
So is Horry County overdeveloping, or failing to meet the demand for additional housing?
The county has steadily grown by about 12,000 people a year since 2010, with an average of 2.4 people per household, Salvino said.
That’s a demand for 5,000 housing units every year, yet less than 3,000 permits for new construction were issued in the last fiscal year.
Many new residents move into existing apartments or houses, but the numbers suggest construction is not keeping up with demand for affordable housing.
Salvino took a broader look by comparing U.S. Census information from Horry, Charleston New Hanover, and Brunswick Counties.
“The affordability thing is a big issue here,” Salvino said. “If we do constrain building, that will become a significant issue.”
Charleston County’s population grew 16% from 2010 to 2018 with 405,905 residents by 2018.
That same year, 3,969 new construction permits were issued.
The median value of an owner occupied house there was $273,100 and the median household income was $57,882.
In the same time period, Horry County’s population grew 28% to 344,147 residents and 4,250 permits were issued in 2018.
Meanwhile, the median home value here was $166,500, and the median household income was $46,475.
The numbers suggest the Horry County region has a faster population growth attracted by more affordable housing, and yet new home building here exceeded Charleston County by less than 300, according to the most recent census number available.
Horry County also has more room to grow with nearly 1,134 square miles, compared to the 916 square miles that make up Charleston County.
Those numbers are comparable to North Carolina, where the Wilmington area growth was similar to Charleston, and Brunswick County aligned with Horry.
New Hanover County grew 14.6% from 2010 to 2018 to a population of 232,274, with 1,918 new construction permits issued in a county that encompasses 919 square miles.
Their median home value was $225,600 and median household income was $51,457.
“New Hanover County is smaller, but the population density is much greater than Horry County,” Salvino said.
Brunswick County, which is in the Horry metro area, saw their population grow 27.3% in the same time period to 107,431.
Nearly 3,000 new construction permits were issue for homes in that market where the median value was $194,700, and the median family income was $51,164.
Brunswick County encompasses 847 square miles.
“Affordability, this is why more people are moving to Horry County instead of Charleston,” Salvino said. “There is more housing here that is less expensive.”
“When putting a moratorium on growth, it’s going to directly impact affordability in a negative way,” Salvino said.