John Baen, Ph.D., a real estate professor at the University of North Texas, stood on a chair several times Friday afternoon as he presented his five-year economic forecast to a banquet room full of city officials and political candidates at a Denton Chamber of Commerce luncheon.
He was not shy about delivering his advice in a dramatic way.
It had been more than 10 years since the lively professor was the featured speaker at a chamber event, and this year he emphasized the importance of investing in a hot North Texas housing market with rapidly increasing values.
“The city of Denton needs to consider affordable housing,” he said. “Like single-family housing; like cottages instead of these big mansions; like affordable places that you can live in when you retire; like an 800-square-foot house.”
In addition to his job as a professor, Baen is a practicing commercial real estate broker and certified real estate appraiser. During his speech, he predicted Texas homes will double in value in five years.
But housing prices, Baen said, are increasing much faster than the average income, which would mean fewer college graduates motivated to invest in a house. He said nearly 40 percent of all Americans already live in rental units. Of those, 80 percent live in multi-family projects such as apartments, condominiums and town homes.
Denton needs more owner-occupied, single-family homes, he said.
“Multi-family housing developments do not make a community that is more stable,” he said.
The cost of apartment rent also is increasing along with the demand, Baen said.
Student housing developments are in high demand with record enrollment rates at UNT and Texas Woman’s University. Those students are suffering from apartment rent increases that are greater than their income increases, Baen said.
Although he predicts the apartment rents will hit their peak in 2016, he said students and graduates likely will remain renters.
“Because we’re going to have a local market where nobody is going to be able to buy a house,” he said. “They’re stuck in an apartment, and we’re going to have a foreign market with people from Florida and California moving in here thinking it’s a great market.”
Baen said 62 percent of Americans own their homes, which he described as a low rate compared to previous years. One of the reasons for the trend, he said, is that the new generation has a different view of the “American Dream.”
“Young people do not have the same dreams as some of you all did, and that was to accumulate a little wealth — or try to,” he said. “But these kids don’t care. They don’t want more of anything.”
Baen delivered his presentation in the center of the room, frequently booming his voice over the audience from the top of a chair. He occasionally interacted with city officials in the audience, like Denton City Council member Joey Hawkins and Denton County Sheriff Will Travis. He even commended the City Council for the recent approval of a Buc-ee’s development.
His energy wasn’t a surprise to chamber President Chuck Carpenter, who had seen Baen’s last presentation at a chamber event a decade ago.
“The last time he spoke, he was using the overhead projectors instead of PowerPoint,” Carpenter said. “Man, he was flipping those [papers] and they were going all over the place.”
Friday’s sold-out luncheon at the Holiday Inn Hotel & Suites was the first time the chamber had a ticketed event in December in 10 years.
Carpenter said the chamber wanted to give members more quantitative data going into 2016.
JULIAN GILL can be reached at 940-566-6845 and via Twitter at @juliangillmusic.