Growth brought new snow skiing resorts, businesses and residents to Idaho in unprecedented numbers. But now rising unemployment likely to reach 10%, increasing foreclosures and going out of business sales are part of the changing economy in Idaho as it gets hammered by the credit crunch.
The real estate crisis is making a major impact in Idaho, which grew for more than a decade and saw its largest cities more than double in population. With more expected job losses and foreclosures not close to their peak, Idaho is in for a long run before its economy is due to stabilize.
Despite the dismal news, the good news is that Idaho has one of the stronger economies in the country and many of its companies are small strongly capitalized firms with little debt. The state had fewer new creative mortgages than many other areas of the country, which should translate to fewer foreclosures to damage the local economy.
In the state's largest city, Boise, which including the outskirts has topped 630,000 residents the year-long decline in housing sales goes on, and is projected to see slow sales through 2009. The positive news for Boise is that the inventory of homes listed for sale and foreclosures, which aren't always listed by real estate agents has dropped, indicating Boise is making a move towards stabilizing.
 |
| City |
Forecast |
| Boise |
− 11.6% |
| Coeur d'Alene |
− 10.8% |
| Kellogg |
− 13.1% |
| Idaho Falls |
− 10.8% |
| Nampa |
− 12.9% |
However, home prices inflated 50% between 2000 and 2006 so Boise's home prices have a lot to go before reaching a point that will be attractive to the majority of buyers. Housing Predictor forecasts Boise prices will deflate 11.6% in 2009 on the average home.
In nearby Nampa , homes are also losing value. The last time home prices rose in the area was in late 2007 and since then Nampa has experienced a deflationary cycle as mortgages became tougher to get and consumer confidence weakened. The credit crunch is taking a toll on the community, which is forecast to deflate 12.6% in 2009. Nampa has one of the highest rates of adjustable rate and subprime mortgages in the state, which are at the center of the housing depression.
In Coeur d'Alene in the northern panhandle of Idaho, new construction has nearly come to a screeching halt after thousands of new homes were built for more than a decade. Home sales have softened and the local unemployment rate is on the rise. Coeur d'Alene is feeling the full brunt of the housing crisis, and sales are projected to remain slow through the year. Housing Predictor forecasts average home values will deflate 10.8% in 2009.
After experiencing a boom for years in Idaho Falls the market has also cooled as the credit crunch makes its impact. The wave of new residents from California has nearly stopped all together, and home sales are projected to remain slow through 2009 on forecast housing deflation of 10.8%.
The real estate boom transformed Kellogg from an old mining town to a posh new snow skiing resort, which offers some of the best white powder in the nation. Silver Mountain Ski Resort is attracting the wealthy to purchase new homes and condos. But the fall out from the national recession is making its impact on the economy, and property sales are down and expected to remain so through 2009, which is forecast to deflate prices an average of 13.1%.
