The Jefferson County bankruptcy debacle has been a huge black eye for the area and the state as a whole for the past few years, ever since it was announced in 2011 that the county would enter into the second-largest municipal bankruptcy in U.S. history. Now, two years and $4 billion later, the saga is drawing to a close. Will the end of the Jefferson County bankruptcy case signal a fresh new start for investment? Our guess is yes – and that means solid potential for our area’s economy. How Leaving Bankruptcy Will Impact Real Estate What makes the bankruptcy case so important for local real estate is due to how closely tied the entire case was to real estate from the beginning. After all, one of the main issues that resulted in billions in debt came with a program designed to overhaul and expand the county’s sewer system. Due to mismanagement and corruption – both on the state level and with the banks who underwrote the debt used to pay for the program – costs ballooned and the county was saddled with billions in fees, interest charges, and principal payments. This ultimately led to the first of several planned sewer rate increases for homeowners throughout Jefferson County that rankled many. What this means, though, is that Jefferson County will undoubtedly be more attractive to outside investment, particularly developers, corporations, and other institutions that will start looking harder at Jefferson County as a possible destination for their projects. More projects and expansion equals more jobs. More jobs mean more people in need of housing – either because they’re relocating or because they want to upgrade from their current home. More demand for housing will eventually boost home prices and rental rates. Birmingham real estate is already on an upward trend for 2014. Now that the stigma of bankruptcy is leaving the county, future economic development could be on its way – to the benefit of us all.
Matthew is the CEO of Evernest. He is a student of the book Good to Great and is passionate about building the best property management company on the planet (and maybe even the universe if Elon Musk will hurry up). You can usually find Matthew at the baseball field with his son, at a dance recital with his daughter, or at his favorite restaurant with his wife, when he’s not in the office. And if you can’t find him in any of those places, it probably means he’s traveling.