Savannah Chamber

26 12 In 2013-22, people mainly bought homes to live in them or as long-term investments that generate rental income. Not too many homes were flipped. Those dynamics will help limit home price declines. Also, supplies of new and existing homes are still constrained by years of underbuilding, a shortage of lots, and scarcities of building materials, appliances, and construction workers. Beyond 2023, there is tremendous potential for more active housing markets because many young people are still living at home, or are doubled up with roommates rather than living in their own apartments or homes. In 2024, renewed economic growth, lower mortgage rates, and slightly larger supplies of homes that are for sale, in combination with a strong preference for detached housing will cause more of that potential to be unleashed. In 2024, housing activity will turn up and home prices will steady. Demographics Demographic forces are another factor behind Georgia's above-average economic performance and comparative good prospects for 2023. Georgia's population will grow at an annual pace that is more than double the national average – 0.7 percent for Georgia versus 0.3 percent for the US. Census data shows that Georgia has been a very attractive destination for mid-career movers. Georgia also performs well when it comes to attracting top-career movers and retirees. According to United Van Lines, the primary reason why people move to Georgia is a job, followed by family connections, lifestyle choices, retirement, and a lower cost of living. In 2023, domestic net migration will be higher than in 2020-22, but lower than prior to the pandemic. Due to the pandemic, domestic net migration declined from 52,508 in 2019 to 37,563 in 2020. Domestic net migration rose to about 51,000 in 2021. Georgia ranked seventh among the states in total net domestic migration from 2020 to 2021. We estimate that domestic net migration remained at that level in 2022. Jobs were plentiful in many of the states that typically send large numbers of people to Georgia which lowers our expectation for net domestic migration to Georgia. Due to stagflation in 2022 and a mild recession in 2023, we expect the number of net domestic migrants to Georgia to be smaller in 2023 than in 2022 . Since we expect Georgia's economy to outperform the average state's economy, net migration to Georgia probably will drop only slightly. We expect about 49,000 net domestic migrants in 2023 compared to 51,000 in 2022. One reason why the drop in net migration to Georgia will be small is that unemployment rates will be on the increase in most states – including Georgia, but Georgia's unemployment rate will remain below the unemployment rates in many of the states that typically send people to Georgia. In essence, people and businesses will be looking to move to states where economic performance is comparatively good. In the recent past, Georgia's higher rate of population growth traditionally depended on net international migration of about 20,000 people. Over the last decade the stricter enforcement of immigration laws, pandemic-related travel restrictions, and pandemic-related reductions in the US government's capacity to process visas reduced that number to about 13,000 in 2020. We expect about the same number of net annual international migrants from 2021 through 2023. Once the effects of the pandemic fully subside and the economic situation improves we expect net flows of foreign-born people to both the nation and Georgia to rise, but only moderately. In addition, Georgia's population growth should benefit from a slight increase in number of births, but the fertility rate is probably will remain below where it stood in prior decades. Population growth will be a driver of Georgia's GDP in 2023 – stronger than in 2020, but weaker than in the years preceding the pandemic. Looking beyond the recession, labor will be relatively more scarce than capital, which bodes well for wages and benefits, but not for returns on capital. Unless productivity increases, a slower trend rates of population and labor force growth imply slower long-term economic growth. Compared to previous decades, workforce development and availability will be a more important determinant of Georgia's economic performance. Post- secondary education will be critical to sustaining Georgia's above-average economic growth.

• Cover