NAHB REPORT ON HOUSING STARTS

The national economy will continue to gain strength throughout the year, but at a slower pace than is characteristic for the early stages of recovery.

Real (inflation-adjusted) gross domestic product (GDP) is expected to grow about 3% in 2010, compared to essentially no growth (0.4%) in 2008 and negative growth (an estimated decline of 2.5%) for 2009.

Coming off an estimated modern historical low of 555,000 total starts in 2009, housing production should rebound by about 25% this year to just under 700,000 units, according to NAHB projects. There is certainly a measure of good news in this forecast, but it hardly represents a return to normalcy.

Based on demographics and other factors, an annual average of 1.8 million housing starts per year will be needed over the next 10 years and 2010 starts are not likely to provide even half of what is needed.

Improvements in residential construction this year will be largely concentrated in single-family construction. Builders successfully reduced their inventory of new single-family houses in 2009 to levels last seen in 1971—for a population that has grown by 80% since that time.

NAHB (National Association of Home Builders) is forecasting just over 600,000 single-family starts in 2010, up from an estimated 440,000 starts in 2009. In a normal market, we would be constructing 1.5 million single-family starts on average yearly.

Although multifamily housing activity should stabilize and improve by the end of 2010, it will be slower than in 2009, with starts declining from an estimated 112,000 last year to an even lower 87,000.

Difficulty in obtaining financing for condos and apartments remains a major stumbling block to new projects, followed closely by historically high vacancy rates that are expected to ease up by the second half of the year, though not by much.
Information courtesy of SUHBA

Moving to St. George, Utah

St. George, the largest city in southern Utah, is nestled in a picturesque valley surrounded by impressive red, sandstone cliffs. It is the county seat of Washington County, in the southwest corner of Utah, just six miles from the Arizona State line on Interstate I-15. Zion National Park and Bryce Canyon are only a few hours away. "Utah's Dixie" has been recognized as an excellent retirement spot in many recent publications, and Washington County remains a thriving area.

The City of St. George, once regarded as a retirement community, is quickly becoming a mecca for endurance sports, and favorite golf and softball destination. St. George hosts hundreds of sporting event each year, including the Huntsman World Senior Games, the NJCAA national fast pitch softball tournament, and the St. George Marathon, bringing hundreds of millions of dollars to the local economy. The World Triathlon Corporation has recently announced that St. George will be the home of the Ford Ironman Triathlon Series for the next five years. St. George is also constructing a new replacement airport; this project is the only brand new public airport under construction in the country, and is creating hundreds of jobs for area residents.

In 2005, the St. George metro area was the fastest-growing area in the country, which led to a boom in both residential and commercial growth. The subsequent downturn—now beginning to stabilize--means that there are bargains to be had. An amazing array of properties is available in St. George and the surrounding areas. The average home price in St. George is approximately $240,000 for a 2,000+ square-foot home. St. George was deemed the 7th safest city of its size in the United States by the Farmers Insurance Group based on statistics for 2007.

Education has always played an important role in St. George. The Washington County School District is one of the strongest districts in Utah. Dixie State College grew from a two-year institution to an accredited four-year college, and is currently pursuing a direct affiliation with the University of Utah. The college's setting is spectacular, with warm weather year-round. The college provides excellent opportunities in the liberal arts, business, and vocational and natural sciences.

One of the City's strengths is its ability to partner with other local, state and federal agencies to improve wildlife habitat and protect open space and hillsides throughout St. George. The City has partnered with various agencies to create the Red Cliffs Desert Reserve Habitat Conservation Plan, setting aside 60,000 acres of open space adjacent to the City for the preservation of the Mojave Desert Tortoise. The City has also worked with private landowners to purchase and protect thousands of acres of wetlands and hillside throughout the community.

With over 34 miles of paved trails and 32 parks, St. George is an outdoor enthusiast's dream. Washington County is endowed with mild, low humidity winters with over 300 sunny days per year. The desert climate promotes year-round recreation and leisure activities. St. George has captured the National Softball Association's Award for "Softball Complex of the Year" for seven years in a row, and hosts 40 softball tournaments per year. Known as the "Year 'Round Golf Capital of Utah," we also offer ten great, scenic golf courses.

Southern Utah is known for its array of outdoor and indoor activities. Zion National Park, with its incredible scenery and majestic mountains, is just 45 minutes away. Hiking, biking, horseback riding, climbing, and river rafting are some of the many possibilities for this area. Snow Canyon State Park is just 10 minutes outside of St. George, with the Tuacahn outdoor theatre nearby featuring outdoor plays, concerts and other performances year round. Brian Head Ski Resort, for those who enjoy snow skiing or snowboarding, is 90 minutes north. The summer Shakespearean Festival in Cedar City is less than an hour away.

Shoppers will also be delighted with the selections available at the Red Cliffs Mall, the Zion Factory Outlet Stores, and the Promenade Mall. These shopping plazas feature easy access from Interstate-15, and are set in an architectural style that is inviting and an attractive addition to the growing area.

The climate in St. George is semi-arid, with two separate rainfall seasons in the early spring and late summer. Although average maximum temperatures for the summer months are between 95 and 101 degrees Fahrenheit, the low humidity makes these temperatures agreeable. The Southern Utah climate features bright sunshine, low annual precipitation, clean air and a wide daily temperature range. Picture clear, blue, sunny skies, add a few white fluffy clouds, red rock mountains, green golf courses, picturesque walking trails, thriving businesses, great shopping and you've got a picture of living and working in the St George area. Join us "where the summer sun spends the winter!"


St. George, Utah

Population: 67,700

Located in Washington County

Cost of Living 2009 St George, Utah

Economic Scenarios in 2010

So what can we expect of the Utah economy in 2010? There are two possibilities going forward for the national economic recovery. We focus upon the national recovery, even though the focus of this article is upon Utah, because whatever happens within the national economic environment will be what largely happens in Utah. It was the national economic malaise that pulled Utah into this downturn, and it will be a bettering of the national picture that will lift Utah out. The two economic possibilities are a slow and steady national recovery, and the other a faltering in the recovery lending to a slip in the Gross Domestic Product and more job losses, followed by an eventual recover. The latter scenario is a W-shaped recovery, where there is an initial but short lived movement upward, followed by an eventual and sustainable recovery (which, when graphed, forms a W shape).
The underlying assumption in this forecast is that a straight but tepid recovery will develop. The possibility of a W-shaped scenario is quite within the realm of possibility, however. After all, the current signs of recovery are largely being driven by federal government spending, which, in the long run, is artificial stimulation.
Consumers and business must be willing and able to carry the economic baton once the federal stimulus gives way. It is anticipated that they will, but in this environment, nothing is certain.
If the W-shaped scenario does not develop, then it is anticipated that job growth will begin in Utah sometime during the first half of 2010. Once job growth starts, it will be slow at first, but as the year progresses, more of the strengthening economic picture will be unveiled. This should elevate the overall feel of the economy, hopefully resulting in more business confidence in the economy and a more robust hiring picture by year’s end. Yes, there will be a job movement upward during much of 2010, but the magical zero line will probably not be achieved and crossed until the end of the year.—www.jobs.utah.gov/wi—Trendlines