Boise is considered a real estate destination for housing and jobs, but lack of a skilled workforce might hamper this growth statewide.
“There are two kinds of growth: Planned and unplanned,” said Clay Carley, general manager of Old Boise and chair of Urban Land Institute Idaho, which sponsored a panel discussion in Boise on Nov. 13. “Our growth is coming. We can’t stop it, and we shouldn’t want to stop it.” Instead, Idaho must use planning to make itself the most desirable place it can be for residents and industrial sectors, he said.
The Boise metropolitan area will hit a population of 1 million somewhere between 2036 and 2040, according to the Community Planning Association of Idaho.
Members of the panel discussion included:
· Clark Krause, executive director of the Boise Valley Economic Partnership, which helps draw new business to the Treasure Valley and helps existing businesses grow
· Travis Rothweiler, city manager for Twin Falls
· Tom Bobo, development manager for Grossman Company Properties, a real estate development and investment company
· Breanna Vanstrom, CEO for Boise Regional Realtors
· Anita Kramer, vice president of the ULI Center for Capital Markets and Real Estate, who presented the ULI report Emerging Trends in Real Estate for 2018
Boise is benefiting from its lower cost of living, particularly its low housing costs, compared with other cities in the region such as Denver, Salt Lake City, Portland, and Seattle, as well as its quality of life. People moving from those regions see Boise as being less expensive, but people already in the Treasure Valley are concerned about rising home prices, Carley said.
The result has been a growth in demand for housing, Vanstrom said. “Our housing market is growing from rising consumer demand vs. a limited supply, not from speculation as was common a decade ago” before the recession, she said. But while median sales prices are trending upward, the rate of increase started slowing in 2015, she said.
In terms of jobs, the Boise area has seen 20.3 percent employment growth over the past 10 years, compared with 13.4 percent nationally, Krause said. BVEP has participated in a number of projects since its inception, including 109 in manufacturing, 47 in customer support, 39 in food processing, and 38 in back office, the organization reports. Average project wages have increased from $38,000 when Krause started in his job in 2010 to more than $50,000 now. The first year after he arrived, he mainly heard from call centers, but that is no longer true, he said. “The market is saturated.”
Twin Falls is also seeing growth, particularly in food production, with companies such as Chobani, Glanbia, Clif Bar, and Jayco moving to or expanding in the area, said Rothweiler. He projects up to 1,100 new jobs will be created between now and December 2018.
But that led to the panel’s other big area of concern: A lack of skilled workforce, which could jeopardize Twin Falls’ ability to get those 1,100 jobs. “Without the employment base, those are lost opportunities,” Rothweiler said. Unemployment in Twin Falls is now 2.5 percent, and in the Twin Falls micropolitan statistical area it is also 2.5 percent. That translates to just 689 unemployed people in the city and 1,461 in the area. “Attracting talent is one of the most critical things we can do in Idaho.”
The lack of workforce is also affecting the real estate market. The number of people in the construction business declined after the recession in the mid-2000s, and they didn’t come back, particularly in skilled trades management, Kramer said. And it’s not even in just a particular field, said Bobo – first you can’t find a concrete pourer because they’re all busy with other projects, and then you can’t find a framer. Another problem with getting workers, particularly skilled tradesmen, to move here from other regions is that wages in Idaho are lower than in other markets, Carley warned.
This story was updated Nov. 14 to correct the September 2017 Twin Falls and Twin Falls micropolitan statistical area unemployment rates to 2.5 percent.