Mile High Market Watch

 

ECONOMIC INDICATORS

· Statewide job growth through December finished at 2% - well ahead of the nation's 1.3% employment gain for the year. "Solid, but not outstanding" is the phrase used to describe Colorado's fourth straight year of job gains, while seeing

unemployment dip to the lowest level in six years.

· Colorado job growth continued in January with a 14,500 increase, 74,000 higher than a year ago.

· Metro Denver's unemployment rate rose from 3.9% in November to 4.4% in December. For the year, Denver unemployment averaged 3.9% - down from 4.4% in 2006 and well ahead of the nation's 4.6% rate. The 17,000 January job cuts by U.S. employers are the most since 2003.

· The nation's unemployment rate remained essentially unchanged in January at 4.9%, but other indicators are everywhere - Zales is closing 105 stores and cutting 20% of its headquarters staff, BMW is cutting 5,600 jobs, GM is offering 74,000 buyouts, Starbucks laid off 220 support staff and will leave 380 other positions unfilled, and Honda is closing its Ohio motorcycle production facility.

· As a further result, a new employment trend is emerging - the number of American workers holding multiple part-time positions is increasing rapidly.

· Led by prospects in non-durable goods manufacturing, transportation, utilities and financial services, Manpower's Employment Outlook Survey says 27% of Denver-area employers say they expect to add workers in Q1 2008 - below

expectations from prior years, but up from 23% in Q4 2007. Early in 2007, half of Metro Denver companies expected to add workers.

· Tax rebates to the rescue? Of the $105.7 billion set to be distributed, a new NRF survey reveals that consumers intend to spend $43 billion (about 40%), use $30 billion to pay down debt, invest $4.4 billion, save $19.8 billion and put $4.6 billion

toward medical bills.

· Consumer Confidence in the Mountain Region increased slightly in January to 121.4, but remains 8% below a year ago. The national index continues to spiral downward at 87.9 - more than 20% below last January's measure and the lowest level since 1992.

· Denver-area inflation slowed in the second half of 2007, our Consumer Price Index increasing 1.9% from the second half of 2006 to the second half of 2007. The first half of the year saw a 3.4% increase.

· Inflation also affects household net worth, which has now declined for the first time since late 2002. The 3.6% drop means we're collectively worth $533 billion LESS than we were a year ago.

· Economists are still arguing about the "R" word, and Q4 GDP isn't helping. The U.S. economy slowed sharply to a 0.6% annual rate, dragging the 2007 total to an inflation-adjusted 2.2%, the weakest pace in five years.

· Due to job growth in government, leisure, energy, professional services and aerospace and strength in energy, agriculture and tourism, Colorado is so far faring better than most national indicators. If there is a recession, real or

imagined, Colorado is expected to handle it better than most.

· While the DOW fell 7.5% between January and February, the Bloomberg Colorado Index dropped 8.5%. Throughout 2007, Colorado-based stocks consistently out-performed Wall Street. (The Bloomberg Colorado Index is a price-weighted index that includes 115 Colorado companies.)

· Metro Denver home sales decreased by 7.2% between December and January, 15.6% below the same point last year. Nationally, home sales fell 0.4% to a point 23.4% below January 2007. Unsold inventory across the country has risen to a 10.3 month supply. The National Association of Realtors blames limited financing options.

· Home prices nationally fell to a median of $201,100, down 4.6% from a year ago. For the year, median home prices in Denver declined by 1.6% over the entire year. Average single family home prices in January were 5.4% below the year ago figure.

· Things are worse in most other areas. 45 of 50 states saw falling home sales in Q4 2007. Denver's 49,789 closings in 2007 fell only slightly below the 50,244 in 2006.

· New home sales continue to drop nationally, with a 2.8% monthly decline in January. Compared to last January, new home sales are off by 33.9%. Across all U.S. regions, a 9.9 month supply of new homes remain unsold.

· The new home construction ripple effect? Home Depot Q4 profits fell 27% after the declining housing market hurt demand for building and home goods supplies.

Similarly, Lowe's profits fell by a third in the same period.

· Metro Denver's residential building permit activity nearly tripled in December, even though most of that was multi-family. For 2007, 14,729 total permits were issued, an 18.1% decline compared to 2006. SFH permits dropped by 35%, while Multi-Family permits increased by 75%.

· Denver's plunge in SFH construction hits the lowest level in 16 years, and by some estimates, could cost up to 10,000 construction-related jobs.

· Foreclosures in Colorado shot up by 40% in 2007 to a total of 39,915, or one of every 45 homes. In the metro area, Adams County was hit hardest, where the foreclosure rate equaled one of every 23 homes. The overall 3.6% rate is nearing the 3.8% record set during the previous housing collapse in 1988.

· The foreclosure trend continued in January. Colorado ranked fifth in the nation with 6,883 new filings, up 9% from December and up nearly 41% over January 2007. Nationally, mortgage delinquencies hit a 23-year high. 5.8% of home loans are classified as "past due."

· Metro Denver's rental vacancy rate increased slightly to 6.1% in Q4 2007, but the overall vacancy rate remains the lowest recorded since 2001. Boulder County is lowest at 4.4%. Averaging $860, rental rates remain relatively stable overall, up

only 0.8% from the 2006 average. Slowing job growth and more moderate rental marketing seem to be keeping the market in check.

· The industrial market follows the same flat year-end trend. Vacancy rates are unchanged at 5.9% and average lease rates

are steady at$5.04 per square foot.

29 buildings (1.67 million sf) of industrial space was completed in 2007 (70% of that in Adams County alone) and another 21 buildings (1.8 million sf) are currently under construction.

 

 

Spring cleaning is on the horizon, and you could use some help. How do you get the kids to pitch in when it's time to spring-clean the house?

Try these five tips to involve children with housecleaning chores:

• Delegate "big jobs" to teens. Once adolescence hits, working with a parent loses it's appeal. Solution? Delegate big--but safe--jobs to teen children.

  Whether they clean and organize the garage, shampoo the living room carpet, or restore order to a jumbled linen closet, they'll take pride in their work IF you truly let them own the job. Ignore all bleating and moaning, and praise their solutions to the skies. In spite of their complaints, they won't let you down.

• Reward hard work. Spring cleaning is nobody's idea of a good time, so plan for a reward for your workers. When the chores are done, schedule a family treat. Whether it's pizza for lunch or a trip to the video store for an evening film-fest, you'll get better results--and sweeten attitudes--if there's a payoff at the end of the day.