While it seems the national housing market is moving again, there’s little evidence of that in eastern Idaho.
While the U.S. Census Bureau reports national construction spending rose 9.3 percent in January from a year earlier, marketing statistics from the Snake River Multiple Listing Service show no improvement in the combined housing market of Bonneville, Jefferson, Madison and Fremont counties.
The rise in eastern Idaho home sales prior to the recession is well documented. In 2004, Snake River Multiple Listing reported 1,879 sales. That hit 2,354 in 2005 – a 25 percent increase. Sales pushed passed 2,400 a year in 2006 and 2007. Then the recession hit, and sales plunged 29 percent in 2008. Declines continued until 2011 and 2012, suggesting the worst might be over. Then sales dropped to just 1,350 in 2013 – lower than any time since the recession began.
Monthly figures show the significant seasonality that comes with home sales. High home sales follow the weather with summer months producing the most activity. Some disruption to the trend occurred in 2010 when the first-time home buyer tax incentives rolled out. While available, the credits bolstered home sales. But once they expired, there was further decline. Home sales picked up again in 2011 and 2012 while mortgage rates were falling, but even with the lowest mortgage rates in history, 2013 still fell behind.
Eastern Idaho’s construction industry employment tracks closely with home sales. The correlation coefficient between the two is 0.81. Construction employment fell by 46 percent between the 2007 peak of 5,970 jobs and the 2011 trough of 3,196 jobs.
Annual construction employment for 2013 is not available, but a four-quarter average through September showed improvement over 2012. Assuming the final three months of 2013 are as good as the same quarter in 2012, construction employment should show annual gains for the second year in a row.
Will.Jenson@labor.idaho.gov, regional economist
(208) 557-2500, ext. 3077