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Housing prices have risen so much in the past five years, many people who work here can't afford to buy, experts say By john darling for the Mail Tribune Jackson County is a great place to live and work, but as wages lag farther and farther behind galloping housing costs, it could be a long-term drag on the local economy. And employers don't know what to do about it. "What could possibly keep up with housing costs here? I don't see any connection between housing costs and salaries," said Michael Cavallaro, executive director of Rogue Valley Council of Governments. The housing market is "being driven by people not involved in the job market of the valley," that is, by wealthy migrants — "not by people who work here, and we're falling behind dramatically," Cavallaro said. From 2001 to 2005, the average wage in Jackson County increased 12 percent — from $27,224 to $30,502 — according to Ainoura Oussenbec with the Oregon Department of Employment in Medford. In the same span, median home prices jumped 46 percent — from $183,657 to $268,100, according to Medford appraiser Roy Wright, who has kept such statistics for the real estate industry here for many years. Advertisement Average rental costs for the county in the same period increased 13.8 percent for a three-bedroom, from $868 to $988. For a two-bedroom, prices rose 8.8 percent, from $624 to $679, according to Cara Carter with the Jackson County Housing Authority. The national Consumer Price Index in the same period went up 11 percent, according to the federal Bureau of Labor Statistics. "Wages keep up with housing? Hell, there's no way. That hasn't happened in this county for 100 years," said Wright. "But it was possible 30 years ago, when I bought my first house here, to handle a down (payment) of $1,000 and develop equity, with payments of $85 a month. Today, there's no comparison. Young people face downs of $20,000 to $30,000 and need two jobs." Typical is single mom Tina Wolfe, of Eagle Point, who faces rent of around $800 for a two-bedroom mobile home, while working a food services job at $9 an hour. "I definitely am not keeping up with housing costs and I feel landlords go ahead and raise rent, if they can, to weed out low-income people like me and get more successful ones," said Wolfe, who was just evicted. "I barely get by. We go without a lot. It's been a while since we bought groceries." At Asante, salaries are "market based" (competitive within the industry) and match inflation with a 3 percent-a-year-increase, "but that certainly doesn't help when you need to buy a house, and housing prices have doubled in the last five years," said Asante Human Resources Director Mike Hancock. "Those who live here, I'm sure they found a way to own or rent," Hancock said. "For new hires from outside the valley, we hear about the sticker shock. If we recruit someone for a high-salary position, they probably have a good house where they are, but here it would be astronomical. They don't want to buy down (step down in home size or quality) — and there's no way the employer can afford to raise their salary. It's not infrequent they turn the job down." Major valley employers and public sector leaders held a Workforce Housing Summit last spring, focusing on ways to provide affordable housing and lower loan costs for workers but "the problem is the lack of funds." "I saw a lot of worry, a lot of interest and a desire to do something," said Hancock, noting that little focus was put on higher wages. Homeowners here have seen huge appreciation in their investments and "they don't want to see anything happen that would take that away from them." Major regional employer Harry & David echoed the theme, with corporate relations Senior Vice President Bill Ihle saying it surveys the valley and "always wants to be competitive" with salaries. "So far, it (housing cost) hasn't been a serious problem for us with candidates (for jobs)," said Ihle. "They have to balance that with schools, hospitals and other quality-of-life issues. If they come from California, they're not going to have the same sticker shock as if they come from elsewhere." As an employer, RVCOG gives 3 to 5.5 percent annual raises to keep up with cost of living, but, said Cavallaro, "as far as I know it's not keeping up with a darn thing. The public sector isn't keeping up either." Nationally, more job seekers are looking for some form of "employer-assisted housing" as part of the hiring package, he added, "but in the Rogue Valley, that's not part of the game. It's minor. I doubt we'll see an explosion of wages here. This has traditionally been a low-wage part of the country. People come here for other reasons and put up with the housing costs." What are the housing choices for the newcomer or young person starting out? "Live in outlying areas, check out a co-housing strategy, get substandard housing — or move out to where housing is affordable, like the Midwest," said Cavallaro. In a service (retail, food service, etc.) economy like the Rogue Valley's, if the hourly workers move out, who's going to do the work? "We're going to be in some trouble," said Cavallaro. "Retirees need services. If you price the low-wage workers out of the market, and don't have public transit to outlying areas and the trend is away from government providing social services — then you're in a bind. There will be pockets of substandard housing, maybe some companies that can provide housing and you'll have a dearth of the middle class." John Darling is a freelance writer living in Ashland. E-mail him at [email protected]. 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