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A BoiseDev Deep Dive

McCall saw its economy take off during COVID-19, but concerns of ‘Boise on steroids’ loom for housing

A little more than a year has gone by since McCall and Valley County officials issued a travel advisory asking visitors, who don’t live in the area, to stay away to slow the spread of COVID-19. 

Since then, Valley County canceled several big events like the McCall Winter Carnival, and some businesses have failed. However, the director of Valley County Economic Development, Andrew Mentzer, says despite the setbacks, the county’s economy fared well. But because of housings costs, visitors and long-term residents are having trouble finding a place to stay. 

Real estate

Looking back at how Valley County’s economy has fared. Photo: Autum Robertson/BoiseDev

Over the course of the last year, there has been an influx of people moving to the mountains. This has been a major contributor to a higher demand for real estate in the McCall area. Valley County’s median house price for single-family homes on Intermountain MLS shows just how hot real estate is right now.

In January 2019, the median house price was $447,500. In 2020, that number slightly dropped to $414,000. But this year so far, the median price sky-rocketed to $779,500.

“We have a lot more long-term residents, and we’re starting to see that shift, which is great,” Mentzer said. “A lot of people are moving towards rural communities and so we’re grateful for that. Those are the types of folks that we’d love to see alongside our visitors.”

[Long-standing McCall rental shop listed for sale]

Housing availability has always been a challenge in McCall, partly because of snowy weather; construction workers have a smaller window each year to build. That, combined with a shortage of rental units for construction workers makes the problem even worse.

“A lot of the people that would be living in reasonably priced housing are the seasonal workers, and historically rentals have it difficult for seasonal workers,” Jonathan Frost, the co-owner of Frost Property Management said. “Shore Lodge is a big, wealthy hotel up here, and they had to buy their own housing so they could get folks from out of the country to come stay.”

Frost says it’s common to hear stories from seemingly well-to-do people not being able to afford property right now, as it can cost $300 or even $400 per square foot to build. Frost calls Valley County, “Boise on Steroids.”

“(I had a guy) call me and said ‘if you could find anything for me, two bedrooms and above,’” Frost said. “He didn’t even care about the price, he’s fairly well-to-do individual… he’s in an RV with his daughters… And he said, ‘I can’t find anything, so even if it’s for a month or two months anything beats living in an RV,’ but this is where his businesses are. This is where he does well but can’t afford to build a home.”

Rentals

Frost said there is not a single rental on the market right now and prices skyrocketed as a result of COVID-19. He adds McCall has always been a pricier place to rent within the county, but typically, any other city in the county would rent out a 1,200 square foot house for around $600 a month. 

“Just before Covid, we were seeing those (size rentals) go up to about $900 to $1,000 (per month), so a little less than $1 per square foot,” Frost said. “And right now, a 1,200 square foot home is renting for $1,800 without anybody batting an eye.”

[Land board to lift McCall-area endowment proposal moratorium, opening way for evaluation of Trident proposal]

Rental units became scarce, and Frost saw it firsthand when he visited a home in Tamarack. 

“I parked in a driveway at a townhome I normally park at because nobody’s ever there. Well, the owner showed up… and asked me to move,” he said. “So I moved to the next spot, and I said ‘wait, do you know if these people live here full time or if there’s anybody here?’ And they said, ‘this cul-de-sac we’re in, there’s only one house now that isn’t occupied full-time.’ And that was extremely rare.”

Tax collections

McCall has two different local option taxes, or LOT, that are required for people doing business within McCall. The street LOT is a one percent tax on retail sales. This does not include motor vehicles or groceries. The city also levies an additional three percent tax on lodging.

LOT receipts help show how busy the year has been.

As BoiseDev previously reported, McCall LOT receipts went up last summer from the previous year, despite the pandemic. Looking at the first quarter of the fiscal year, October 2020 to January 2021, for both the lodging tax and the street tax, this still rings true.

The first quarter of the new fiscal year showed a significant increase in lodging LOT receipts. In the first quarter of 2019 McCall brought in $143,750, in 2020 the city earned $163,291 but this year there was a major jump to $223,385. 

201920202021
Q1 lodging LOT collection$143,750$163,291$223,385

The over $60,000 increase is partially due to the lack of housing options driving up prices. 

“So a lot of the issues with local housing that were prominent before COVID are in far worse shape now,” Mentzer said. “Just because supply and demand economics don’t bode well when you see that kind of influx of activity.”

Something similar happened with the retail LOT. During the first quarter of the fiscal year of 2019, McCall earned $517,328, in 2020, $587,764 but in 2021, there was a tremendous increase to $694,029.

201920202021
Q1 retail LOT collection$517,328$587,764$694,029

“COVID has driven a massive amount of activity in our region economically,” Mentzer said. “It’s certainly ignited population growth, and a lot of adaptations at the community level and the industry level. And in doing so, one could argue that we’re better or better off economically. We’ve seen a lot of growth.”

Autum Robertson - BoiseDev reporter
Autum Robertson is a BoiseDev reporter focused on Meridian and McCall. Contact her at [email protected].

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