Tuesday, July 1, 2014

Local Market Monitor offers lackluster forecast for Idaho Falls

A section from the May 31, 2014, report by Local Market Monitor.
Idaho Falls home prices are forecast to increase by 1 percent over the next 12 months, according to a report by Local Market Monitor, a company in Cary, N.C., that keeps track of fundamentals in 300 markets across the United States.

Over the next three years, prices are anticipated to go up 7 percent, said the company's latest report, dated May 31.

"Economic growth has been erratic since the recession. Growth was poor in the past year, with jobs weak in government, healthcare and the big retail sector. Expect erratic growth the next few years," the report said.

At the county level, the forecast was not any more robust. Bonneville County home prices were pegged to rise 0.7 percent in the coming year, 2.3 percent the next year and 4.2 percent the next. In Jefferson County, the forecast was for 1 percent growth, rising to 2.6 percent then 4.4 percent.
Nationally, prices are forecast to increase by 7.7 percent.

"There was a modest housing boom and bust, but home prices have been flat in recent years," the report said. "Rents are very low. Population growth has been average. Job growth and low unemployment will increase housing demand, but mainly for rentals. Expect a weak housing market the next few years. ... The market is currently underpriced, -12 percent relative to income."

At the heart of any healthy economy is job growth. "Jobs in the market have grown by 0.4 percent," the Local Market Monitor report said. "This compares to a national increase of 1.7 percent."
Population in the market grew 0.9 percent, compared to 0.7 percent for the United States. In 2012, population migration was -0.1 percent.

The report forecast rents in the Idaho Falls market to increase 11 percent over the next three years, to an average of $837 a month.

Total housing permits in April this year were down 9 percent from last year, and single family permits were down 14 percent.

5 comments:

  1. If I read this correctly, the chart was from information dated 5/31/2014. I don't recall how much NuScale or Fluor had made public in time for a report to release information on how quickly they would re-open an Idaho Falls office.

    No, there aren't currently enough NuScale employees to change much housing demand. However, if they are meeting with potential vendors in Aug. to list the materials they will need for this > $ 2 Billion work to build small reactors, doesn't anyone besides me think new businesses or local businesses will have to expand? Then there is the matter of who will build NuScale's product (or maybe that will be products), and will additional employees be needed by either local businesses that will have to add employees or new vendors opening in Idaho Falls.

    Does no one else think NuScale's need for workers, vendors and perhaps more will bring more people to Bonneville County?

    Then there is the Anheuser-Busch expansion. Not a lot of new Anheuser-Busch jobs, but additional need for Malt Barley from Idaho farmers. Agricultural can never be forgotten as a part of the economy it is.

    A few other smaller projects and a bigger one that hasn't been announced here yet. No one project is going to bring 5,000 workers. But growth in the energy, agricultural, and other core areas of the economy for which Idaho Falls is the hub for Eastern Idaho, all contribute to who needs or will need a home in Bonneville County.

    I'm surprised those announced and nearly announced projects weren't mentioned here. Maybe I'm the one who is missing something. If so, PLEASE other readers and Paul, post so I can think about this correctly.

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  2. I think many people are hesitant in making any type of forecast. Areva coming in and then semi-pulling out 'muddied the water.' At this point I am hoping they make it work. Having offices here and the governor make a visit to welcome them are good signs. However, I am waiting for 'hammer to hit nail' until I am really convinced. Just saying . . . .

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  3. This outfit is looking at very specific numbers and making forecasts based on the trends they see in them. Day-to-day news cycles are not going to have much effect, I don't think. Fluor is assembling a team to bid on the cleanup contract, and NuScale is piggybacking on them for the time being. If they get through all the regulatory hoops, they anticipate moving dirt around 2018. There is a lot that can happen, good and bad.

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    1. Yes, a lot can happen. Perhaps even a merger locally with Areva, since they have kept their Nuclear License current. Not really Areva's focus but a merger could start an entire new business focus for them. If Areva were actively working with Fluor, who knows what funding opportunities might become possible for Areva?

      I see a lot of possibilities with NuScale.

      You may have additional information we don't.

      It was interesting to read again what you wrote, along with Corey Taule, for the energy (Nuclear) special Post Register in 2013.

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