California dreaming? More like a nightmare

Print Article

The term “Californification” is not meant to be a slur on people who move here from California. Instead, with my famous minor in economics, I would like to address “the creeping degradation of our local economy toward the California model.”

Shopko just closed, the Silver Lake Mall (both ends) are closed to retail … Why?

Unemployment is at an all-time low, most homeowners are worth more than ever, so why are local businesses closing?

Some people will blame internet sales. Who could argue with that? When I can’t find something locally, I order from Amazon Prime. Who doesn’t? I’ve heard stories of customers trying on shoes locally to get the right size, then ordering online. (Might I say, “Shame on you!”)

In my humble opinion, Californification means “loss of discretionary income.” That’s what you find in California. After the average family makes their new higher house payment, a higher, longer car payment, and buys necessities such as food and shoes for the kids, that family has a proverbial five bucks left. Why?

In North Idaho and Spokane, homes that once sold for $130,000, with a $564 payment, now sell for $269,000. Same house? “No, it’s four years older and needs a new roof.”

The new payment is $1,290 a month. If you’re lucky, your income went up $200 a month, but your house payment went up $736. That difference doesn’t buy new furniture, a new car, or even a pair of shoes locally.

You can travel the LA basin and see shopping center after shopping center — empty, not one store open. Sure, Walmart and Target will probably survive. They have thousands of stores to defuse the problem. Those big box stores love Iowa, Nebraska, Kansas — anywhere that housing prices are not raping the local economy of its discretionary income spending.

The next chapter in Californification will be “interest-only loans.” In California, virtually all mortgages are “interest-only loans.” That means at the end of a 30-year loan, they still owe as much as they originally borrowed. If that happens in North Idaho, the $269,000 house with a $1,290 payment will be $600,000 with a $3,000 payment, and yes, it will still need a new roof. If you’re lucky, you will still have $5 left at the end of the month.

How can we stop the next chapter in Californification? Make interest-only mortgages illegal in Idaho.

•••

R.H. Duffield is a Coeur d’Alene resident and business owner.

Print Article

Read More My Turn

Clarity essential to understanding cost of bonds

August 24, 2019 at 5:00 am | Coeur d'Alene Press When taxpayers are asked to vote on a $70 million school bond, they deserve accurate facts and honest disclosures about costs from their school board. I’m aware of the discussion about the cost to ta...

Comments

Read More

OPINION: JIM JONES — Get weapons of war off America’s streets

August 21, 2019 at 5:00 am | Coeur d'Alene Press During my service in Vietnam, I had the opportunity to witness the use of weapons specifically designed to kill or maim as many people as possible in the shortest amount of time. My heavy artillery b...

Comments

Read More

Post Falls: Its vision is blurred

August 17, 2019 at 5:00 am | Coeur d'Alene Press Recent comments by the Post Falls Community Development director, published in the July 31 Press, reveal much of what’s wrong with the leadership of this city. He said the hope is to purchase the Ida...

Comments

Read More

Don’t let legislators circumvent initiatives

August 10, 2019 at 5:00 am | Coeur d'Alene Press Initiatives give ordinary people a voice in determining the laws they must live by. Initiatives enable citizens to bypass their state legislature by placing proposed statutes directly on the ballot, ...

Comments

Read More

Contact Us

(208) 664-8176
215 N. Second St
Coeur d'Alene, Idaho 83814

©2019 The Coeur d'Alene Press Terms of Use Privacy Policy
X
X