Report predicts 2013 return to normal for Boise homebuilding

While some parts of the economy are finding their way back on track, homebuilding is still far from normal.

A new report from BuildIdaho.com and Organizational Genetics looks at trends for 20 different performance measures – some local and some national – and analyzes what those say about the future.

It seeks to give some context to the economy.

The report indicates that homebuilding and related industries should not be expected to return to normal until the summer of 2013.

A few performance measures that did fall into the normal range were the stock market and gas prices on a national level, and population outlook, new home construction costs and existing home sales on a local level. The one measure that was better than normal was mortgage interest rates, which were at a low 5.14 percent at the end of 2009.

All other measures (including consumer confidence, employment, air traffic, in-migration, foreclosures, new home permits, land cost, real estate financing, and more) were determined to have below-normal performance.

A few of the measures give especially dire indications for the future of homebuilding.

“If unemployment is at 10 percent, a lot of people don’t have money and they won’t be buying homes,” said Trey Langford of BuildIdaho.com. “Additionally, because of unemployment, the number of defaults is rising dramatically. So not only can they not afford to buy a home, but they’re losing the one they have.”

He said as long as unemployment and foreclosures are high, homebuilding can’t be at the bottom.

“People are buying homes now, so it’s not like it’s stagnant, but in terms of normal, we’re not there and we won’t be there for quite a while,” he added.