How Do Housing Costs in the Treasure Valley Impact the Local Economy?

The Treasure Valley, located in southwest Idaho, is home to a rapidly growing population. This growth is largely driven by the area’s strong economy, which has attracted businesses and workers from all over the country. However, the region is also facing a housing crisis, with home prices rising at an unsustainable rate.

The median home price in the Treasure Valley is now over $500,000, making it unaffordable for many families. This is having a ripple effect on the local economy, as businesses struggle to attract and retain workers who can’t afford to live in the area.

How Do Housing Costs Impact Businesses?

When housing costs are high, businesses have to pay more to attract and retain workers. This can lead to higher prices for goods and services, which can hurt the local economy. Additionally, high housing costs can make it difficult for businesses to expand or relocate to the area.

A recent study by the Boise State University Center for Economic Development found that the Treasure Valley’s housing crisis is costing the region $1 billion per year in lost economic growth. The study also found that the crisis is making it difficult for businesses to attract and retain workers.

How Do Housing Costs Impact Workers?

When housing costs are high, workers have less money to spend on other goods and services. This can hurt the local economy, as businesses lose customers. Additionally, high housing costs can make it difficult for workers to save for retirement or other financial goals.

A recent survey by the United Way of Treasure Valley found that 60% of respondents are struggling to make ends meet due to high housing costs. The survey also found that 40% of respondents are considering leaving the Treasure Valley because of the high cost of housing.

What Can Be Done to Address the Housing Crisis?

There are a number of things that can be done to address the housing crisis in the Treasure Valley. One is to increase the supply of affordable housing. This can be done by building more affordable housing units or by providing financial assistance to first-time homebuyers.

Another way to address the housing crisis is to regulate rent increases. This can help to keep housing costs affordable for renters.

Finally, it is important to address the root causes of the housing crisis, such as the lack of affordable housing and the high cost of land. This will require a long-term commitment from all levels of government.

How Housing Costs Impact Workers

Disproportionate Financial Burden

High housing costs disproportionately burden workers, especially those with lower incomes. After paying for rent or mortgage, many workers have limited funds left for other essential expenses, such as food, transportation, and healthcare. This financial strain can lead to food insecurity, transportation challenges, and difficulty accessing healthcare services.

Reduced Economic Mobility

Unaffordable housing hinders economic mobility for workers. When a significant portion of income is spent on housing, workers have less disposable income to invest in education, training, and other opportunities for career advancement. This can perpetuate income inequality and limit workers’ ability to improve their economic status.

Brain Drain

High housing costs can contribute to a “brain drain” in the Treasure Valley. Talented professionals and skilled workers may leave the region in search of more affordable housing markets. This can have negative consequences for the local economy, as businesses lose access to a skilled workforce and the community loses the contributions of these individuals.

Addressing the Housing Crisis: Potential Solutions

Increasing Affordable Housing Supply

One approach to addressing the housing crisis is to increase the supply of affordable housing units. This can involve various strategies:

Building more affordable housing: Governments and non-profit organizations can invest in the construction of affordable housing units to increase the inventory of affordable homes.
Providing financial assistance to first-time homebuyers: Programs that offer down payment assistance, low-interest loans, or other financial incentives can help first-time homebuyers overcome the financial barriers to homeownership.
Encouraging accessory dwelling units (ADUs): ADUs, also known as granny flats or in-law suites, can provide additional affordable housing options by creating separate living spaces within existing homes.

Regulating Rent Increases

Another strategy is to regulate rent increases to prevent excessive rent hikes that disproportionately impact renters. Rent control measures can limit the amount that landlords can increase rent by annually, providing renters with some protection from rising housing costs.

Addressing Root Causes

Addressing the underlying causes of the housing crisis is crucial for long-term solutions. This involves measures such as:

Increasing land supply: Exploring ways to increase the availability of land for residential development can help reduce land costs and make housing more affordable.
Improving zoning regulations: Streamlining zoning regulations and reducing barriers to development can encourage the construction of more housing, including affordable units.
Providing incentives for affordable housing development: Offering tax breaks, subsidies, or other incentives to developers can encourage the creation of more affordable housing units.

Conclusion: A Collective Effort for Sustainable Growth

The housing crisis in the Treasure Valley is a complex issue that requires a multifaceted approach involving collaboration between government, businesses, non-profit organizations, and community members. By increasing the supply of affordable housing, regulating rent increases, and addressing the root causes of the crisis, we can create a more sustainable and equitable housing market that supports the economic growth and well-being of the region.