Survey shows county economy rebounding

MEEKER I In spite of local perception, the recession hasn’t hit Rio Blanco County as hard or affected it as deeply as other areas of the country, nor is the current economic situation as dire as the bust experienced in the early ’80s.
“We’re used to boom/bust in this state. What we saw in the ’80s was a much deeper bust than what we’re seeing now,” said Melanie Rees of Rees Consulting, Inc., at a special public meeting last week in Meeker. Rees presented the results of the first-ever countywide housing study in Rio Blanco County.
The survey was sent out last spring and 506 responses were received. Consultants compiled responses from employers, from residents and from secondary sources of information.
After the energy-related boom of the past few years, housing availability has once again returned, but the availability of rentals and properties for sale doesn’t mean the county is without housing problems.
“We think your supply and demand is in equilibrium right now. But there’s not a lot of freedom, flexibility and movement in the marketplace,” Rees said.
The greater problem faced by the county is the variance between housing prices and income levels, which “are not at all in line.”
While the average income of Rio Blanco County households has increased since 2000, housing sales and rental prices indicate that the county is “losing your middle class.”
Prospective home buyers in Rio Blanco County need to make 160 percent of the Average Median Income (AMI) in order to buy a median-priced home.
“That’s like a Boulder thing,” Rees said. “You are exceeding what your salaries can provide for housing … You don’t have any entry-level ownership here.”
Rees attributed the price/income disparity to the relatively small number of homes available for sale and a lack of cooperation between local realtors.
“This is the only county I’ve ever worked in where you can’t go in and find a list of all the homes are for sale, you don’t have a lot of realtors here, but they don’t work together.”
Only 3 percent of properties are currently for sale in RBC, and while prices have “flattened” after reaching record levels in 2007, they remain higher than the average resident can afford.
“For housing prices to come down, there have to be a lot more houses on the market.”
Construction of new units, which reached a high in 2007, dropped to its lowest level in five years during the last half of 2009.
Renters have also experienced this upside-down pricing in housing costs.
“I’ve never seen such volatility in rents,” Rees said. In Meeker, rental prices jumped 151 percent from 2000 to 2009, and increased 60 percent in Rangely.
“There are no vacancies in any of the subsidized (low-income) properties.”
According to Rees, demand for housing in RBC is directly related to employment. With roughly 5,000 jobs in the county now, estimates for the next five years vary from a 1.7 to a 2.4 percent annual increase in available jobs.
With national unemployment at 10 percent, RBC “is doing very well” with a 3.8 percent unemployment rate.
”You guys have already experienced the worst of the bust, you’re already in economic recovery,” Rees said. “In some parts of this country, it’s really doom and gloom, with 20-30 percent of houses up for sale and up to 15 percent foreclosure.”
Solving the existing housing challenges will require education and communication between county and town governments and local builders.
“Public opinion (for affordable housing) generally supports (the idea) but education is needed to correct the misconception about what ‘affordable’ means. There are a lot of people batting around the term affordable, but no one is pinning it down.”
Builders have no incentives to provide affordable housing, Rees said. “If you (the builder) have the opportunity to build one $1 million home for one client who’s going to pay you cash, or build 10 $100,000 homes for 10 families, many of whom are not going to qualify for a loan, what are you going to do? Help the builders do what’s best for the community.”