The gap between the amount that local workers earn and the price of housing in Blaine County will transform the area in ways that few people envision today.
Doing a little math backwards shows that the local housing squeeze could easily destroy some locally owned businesses and sap vitality from the rest.
The Hailey area has the most affordable housing in the valley, according to a report released by Windermere Real Estate.
Hailey’s median sold price for a condo/townhouse in 2020 was $280,750. The median home sold for $545,000. Rental rates are tied to sales prices.
The rule of thumb for home loans is that annual family earnings must be at least 28% of a home’s price. Thus, it would take earnings of $78,610 to buy a condo or $152,600 to buy a home. Homeowners association fees mean the earnings needed are really even higher.
But hold on. Median household income in Blaine County in 2019—which included multiple earners per household—was $56,694.
That means local workers are $21,916 short of affording a condo and $95,906 short of buying a home. These middle-income households would have to get 28% pay hikes to buy a condo and 63% hikes for a home.
Every time this wage-home-price gap comes up, someone says, “Local businesses just have to pay people more.” However, it’s not that simple.
Businesses would have to hike prices, which would reduce sales and still leave them short of the wage mark.
Too little housing means too few qualified workers and weak businesses. With no solution in sight, residents could find their towns unhappily transformed into anemic places they do not recognize.
This is not just a doom and gloom opinion. It’s math backwards.
“Our View” represents the opinion of the newspaper editorial board, which is made up of members of its board of directors. Remarks may be directed to email@example.com.