More measured news from Local Market Monitor

When it comes to economic news, if you’re looking for cold water on the face then Local Market Monitor is the place to go.

The Cary, N.C.-based company keeps track of fundamentals in 300 markets across the United States. The September 2014 forecast for Idaho Falls is not horrible, but it offers a far more measured picture than an optimist would like to see.

Here’s the good part: The last time I reported on LMM, on its May 2014 report, it projected Idaho Falls home prices rising 7 percent in the next three years. The report for September projects a three-year rise of 10 percent.

“Economic growth has been erratic since the recession. Growth was mixed in the past year, with job gains in government, but weakness in healthcare and the big retail sector. Expect erratic growth the next few years,” it said.

The LMM’s audience is real estate investors, and with an investment score of 5.6 the risk of buying real estate in Idaho Falls is considered a medium bordering on low.

Here are a few more excerpts:

Home Price
Home prices in this market peaked in Q1 2008 at $190,976. Since their peak, prices have fallen by 15%. In the last 12 months, prices have gone up by 3 percent. The average home price in this market is currently $162,149.

Housing Permits
Total housing permits in August 2014 were down 15 percent from last year. Single family permits were down 9 percent.

Rents
We forecast rents to increase 10 percent over the next three years in this market, to an average of $837 per month, partly due to higher inflation.

Employment
Jobs were down -0.4 percent in the past year, compared to the national gain of 1.8 percent.

Monday Business Profile: Kickshot Locksmith

Slade Hoopes, owner of Kickshot Locksmith

Growing up in Idaho’s Teton Valley, Slade Hoopes had always figured he’d be a farmer, but when his parents sold their land to developers in 2008 he turned to something that had fascinated him since he was a child, locksmithing.

Hoopes, 27, can pick an old-fashioned lock with the best of them and has an arsenal of customized tools for getting into locked Fords, Dodges, Toyotas and what-have-you. But with high-tech electronics and the Internet, it’s a much different world than even five years ago.

Running his own business, Kickshot Locksmith, Hoopes, 27, knows he’s the new kid on the block. The changing nature of the market has allowed him to identify certain niches where he hopes to make a name for himself as the go-to person.

After his parents, Jack and Lorna Hoopes, sold their land in Teton Valley they were looking for franchise opportunities in which to invest. Hoopes, then a student at Boise State University, told them about Pop-A-Lock, based in Lafayette, La. They signed up and he ran it for two years in Boise, selling the business in 2010.

Hoopes came back to eastern Idaho and spent a brief period driving a food truck, then started Kickshot in 2012. “I’m essentially doing the same thing I did with Pop-A-Lock without paying royalties,” he said. “I knew what I needed and did not need.”

Since starting the business, Hoopes has focused on automotive keys. With older car keys you can still make a duplicate at the hardware store, but Sidewinder and laser cut keys require special machinery and computer codes. Lose the key to your Audi and you can do one of two things. Call the dealer in Boise or Salt Lake City (and pay to have the car towed there) or call Hoopes, who can make one right away for 15 to 25 percent less money.

Hoopes has a unit that communicates with a car or truck’s onboard computer and marries the key to the car’s ignition. “The profit is in the programming,” he said.

Like a lot of locksmith’s, Hoopes offers to unlock any vehicle door for free if there is a child locked in. It’s the right thing to do, but he admits it’s a marketing ploy at heart — in a desperate situation, nobody is going to let a child roast in a car seat out of reluctance to break a window.

Hoopes’ customers include Hertz Car Sales and local repossession yards. He is also dipping a toe into home security system set-up, a rapidly changing environment as well. “You can unlock your home or turn on the lights with your smart phone now,” he said.

Managers need to be friendly, not friends, with employees

I loved college for a number of reasons.  One of them was I had a laid back job at a major corporation with a supervisor who rivaled my best friends on campus. It was a great place to work, at least for a short period of time.

In fact, my supervisor was amazing for quite some time. During the day she would defend our division against the corporate “big wigs” who visited our office semi-annually from the East Coast (and who we felt knew nothing of what we did). After hours she was chummy with the team through various social engagements. It all was a workplace dream come true until personal conflict entered into the picture.

Slowly but surely, as our division developed personal issues between co-workers so entered the problems associated with “picking sides” by our supervisor. Friendships with subordinates became problematic because professional decisions were being made on an emotional and personal basis, favoritism started to blanket the office, morale went down and performance started showing it.
These performance and operations issues did not go unnoticed by the higher-ups, resulting in some “come to Jesus” meetings my supervisor’s reassignment to another position. It was a hard lesson to learn, I am sure, and had a major impact on the company.

Is it OK for managers to be friends with their employees?

Over the years I have worked with a lot of management. Some have understood the balance between personal and professional relationships. Others would rather play the nice guy and be buddies rather than bosses.

This is an issue with newly branded managers all the way up to experienced and “C” level executives, and there’s not any simple answer or scenario.

We spend a lot of time at work and with our co-workers.  So it is easy, and almost natural, for friendships with co-workers to develop. It also is important to remember employees and managers alike are still people. Emotions, beliefs, biases, opinions, etc., all enter into the workplace regardless of who we are or what position we hold.

That’s where the problem itself lies when bosses become buddies. Friendships have their ups, downs, bruises and bumps.  Wouldn’t friendships be even more complicated if one of the friends had the ability to hire, fire, promote or discipline the other friend?

The answer is pretty simple. Not only would this be complicated, but it would introduce complaints about favoritism, discriminatory employment practices and unrealistic expectations.

Any “negative” decision made, especially mainly on the management side, is going to have a heavy impact on the “friend” on the other side. More than likely the decision is going to be taken personally, esulting in an emotional response — sooner or later, inside or outside the workplace.

Think of your ultimate betrayal and that gives you a small sense of what this story could end. I’ve seen it happen, and folks it is not pretty.

I am not recommending that managers should not have any relationships with employees. What I am recommending is “friendly” leadership that doesn’t cross over the “friendship” boundary.

Finding this balance is tough, no doubt. We can always start by looking at what employees look for in great leaders. Employees follow leaders who demonstrate interest in them, care, concern, compassion, understanding and support, and the ability to lead by example.

The best foundation for any relationship in the workplace should be based on professionalism and business guidelines. While friendships between management and employees make for a fun and light workplace, they can lead to big problems. Overall, it’s just bad business.
Monica Bitrick is CEO of Bitrick Consulting Group, an Idaho Falls human resources company.

Home sales numbers stay steady for Bonneville County

It has been a few months, so I thought it might be a good time to check the pulse of real estate in Bonneville County. Other than putting your own house on the market, the best (and less stressful) way to do this is to check the Snake River Regional Multiple Listing Service, which keeps track of home sales, average days on market, median price and homes listed.

Going whole hog, I went down the columns all the way back to 2004, which, as one might surmise by looking at the table above, was the year before the boom started.

As good as the numbers look — this year is holding steady with 2013 — we’ve still got a bit of a climb before we get back to the go-go times of 2005, 2006 and 2007. And it may never happen. As immune as we think we are to national trends we are not, and there’s sobering news out there.

The monthly bulletin from Local Market Monitor paints a fairly sobering picture concerning debt and employment. Here is what it said:

Quite aside from the $10 trillion home owners owe on their mortgages — an amount that doubled in the last 20 years — they owe more than $3 trillion in consumer debt, $10,000 for every man, woman and child in the US. This used to be mainly credit cards and car loans, but over half of it is now concentrated in two groups that are very important to real estate. Home owners owe $450 billion in home equity loans, and young adults owe $1.2 trillion in student loans (whew!). Is it any wonder that so many home owners and would-be new ones have to sit on the real estate side lines?

With many buyers unable to buy, it's pretty clear why home prices are below income levels in most local markets today and why new construction has added so little to the economy. What's worrisome is that this situation, especially for young adults, isn't going to change much in the near future.

In September, the number of jobs was 2.0 percent higher than a year ago — a sign of slow, continuing improvement. Jobs were up 4 percent in construction, 1.3 percent in manufacturing, 1.8 percent in retail, 3.8 percent in business services, 2 percent in healthcare, and 2.8 percent at restaurants.

Government jobs were flat, not only at the federal and state level, where political considerations weigh most heavily, but also at the local level, where spending on education is necessary for long-term economic growth.

Sixty seconds over Cabela's

Dave Schwicht, right, and me, face to face with the future. The FAA has said commercial use of drones is illegal, but the ruling was knocked down by an administrative law judge and is being appealed.

Cyndi and Dave Schwicht of Keller Williams Realty East Idaho admit there's a "wow" factor to offering drone reconnaissance of real estate properties. "Guys see it and really get into it," says Dave.

Their DJI Phantom, bought on Amazon.com, cost them about $500. The GoPro camera that mounts on the underside cost about another $500. The expense has been worth it, they say, as it has brought them lots of attention.

"It's not that great for showing the front of a house, but if there's a big piece of land you can show people a lot of things," Cyndi said. What's more, if you download the GoPro app onto your phone you can see the view from the sky in not-so-real time (download can be kind of slow and jerky.)

Crows do not like this radio-controlled four-rotor gizmo at all, and have attacked it. Neither does the Federal Aviation Administration. Although regulations are being worked on, the FAA currently considers it illegal to fly drones for commercial purposes, including real estate photography and journalism.

In March, however, an administrative law judge for the National Traffic Safety Bureau ruled that the FAA's ban on commercial drone flights was not legally enforceable. The case involved Raphael Pirker, who was fined $10,000 for flying a drone over the University of Virginia to obtain promotional footage.

Since the ruling, it appears the FAA hasn't been cracking down on real estate agents using drones, said Paul McLaughlin, attorney for the Iowa Association of Realtors, in an article published July 7 in USA Today.

Because Tuesday was a beautiful day with very little in the way of wind, we took the DJI Phantom out for quick cruise over Cabela's, a project of widespread interest. Here, for your viewing pleasure, here is the MP4 file. Dave was careful not to get too close, so as to not distract anyone on the job site or run afoul of the authorities.