Researcher: Northern Rockies Housing Market Near Bottom, Will Rebound Soon

By Greg Lemon, 4-17-09

As the national economy comes out of the recession and sets a course for the future, changes in demographics are going to radically shift demands for housing, not only in the Mountain West, but around the country.

This was the message from Arthur C. Nelson, presidential professor and director of Metropolitan Research at the College of Architecture and Planning at the University of Utah, who was the keynote speaker at the Designing the New West Conference in Bozeman Friday.

“Now is the time to think ahead about the new paradigm that will come – it’s already well underway,” Nelson said.

Nelson looked specifically at Northern Rockies – Idaho, Montana and Wyoming. In these areas, he said, the housing market is currently working through an over-supply of homes. Montana is probably at the bottom of the housing market now. Idaho should be there next year and Wyoming will be there by 2012.

The emerging housing market will be driven by two major demographic changes: the growing baby boomer populations, and a continued shift from large families to small families and couples and singles without children.

“Eighty-six percent of the new demand for housing is assignable to households without children,” Nelson said.

Populations in Montana, Idaho and Wyoming will continue to grow – doubling by the year 2050, he said.

These growing populations will want to live closer to services and urban centers. They’ll quite buying large lot single-family homes and focus on connected housing units and small lot single-family homes. They’ll be more apt to rent. They’ll live longer – possibly much longer – due to advances in medicine.

“The bottom line is by 2020 we can probably expect the typical American to live to 120 or 140 somewhere in there,” Nelson said. “A lot of people are thinking it’s pretty imminent that we’re going to live well into our hundreds.”

Ultimately, the best opportunity to serve this new market is going to be urban redevelopment opportunities, he said as he flipped to a slide of an abandoned strip mall with acres of asphalt. Spots like this will become prime areas to build mixed-use developments to meet future demands.