Nonagricultural wage and salary employment in the Northwest region increased 1.7 percent during the 12 months ending in November 1999, compared with a 2.8-percent growth rate for the same period in 1998. Idaho moved ahead of Washington, recording the highest rate of growth, at 2.1 percent, due to expanding employment in the Boise area. Washington was close behind, with a growth rate of 2 percent. Gains in Alaska and Oregon were more modest, at 1.5 and 1.1 percent, for the 12-month period. The rate of employment growth in Oregon has slowed, due, in large part, to much slower growth in the high-technology sector. In Washington the unemployment rate as of November was 4 percent, with Seattle and Tacoma recording rates of 2.9 and 3.8 percent, respectively. The unemployment rate in Alaska was 5.8 percent. Idaho and Oregon reported rates of 4.3 and 5.3 percent, respectively.

The housing sales market remained strong during 1999 throughout much of the Northwest. The most recent data from the NATIONAL ASSOCIATION OF REALTORS^® show existing home sales of 282,700 for the region in 1999. Sales in Washington State were up 10 percent from 1998 to 175,700. The other three States experienced modest decreases in activity, compared with the very high volume of activity in 1998. In Washington the median sales price for existing homes has risen nearly 50 percent in the past 10 years to $168,000 as of third-quarter 1999. The annual rate of existing home sales rose 7 percent between third-quarter 1998 and third- quarter 1999, and the median sales price increased 3 percent during the period. The median sales price for existing homes in some close-in neighborhoods of the Seattle metropolitan area has increased 75 percent or more in the past 10 years.

The most recent data from the NATIONAL ASSOCIATION OF REALTORS^® show an annual rate of 62,400 existing home sales for Oregon in 1999, a 1.1-percent drop from 1998. In Idaho the annual rate of existing sales totaled 28,600 homes, down 3.7 percent from 1998. However, local sources report that sales in Boise through November were up 4 percent, and that the average sales price was up 3 percent to $113,500. Regional analysts point to Boise as the area in the Northwest to watch for increased housing production in 2000 and beyond. Home values in Alaska have continued to increase at the rate of 2 to 4 percent annually for the past 10 years. As of fourth-quarter 1999, the average sales price in the Anchorage area was approximately $175,000. Projections for the Alaska sales market are good, with sales and prices expected to continue increasing at approximately the same pace.

Single-family building permits in the Northwest region during 1999 totaled 57,270 homes, down less than 2 percent from 1998. Multifamily permits for the year totaled 22,940 units, down 15 percent from 1998. In the Seattle-Tacoma-Bremerton area, single-family activity through December was down only 2.6 percent from a very strong 1998, to 16,731 homes. Multifamily permits in the area totaled approximately 11,560 units, a 13-percent drop from 1998. Boise continues to be one of the region's most active markets, with single-family permits up 3 percent and multifamily activity up 16 percent.

Conditions in the Northwest region's major rental housing markets remained unchanged during 1999. Puget Sound area rental vacancy rates are approximately 5 percent, with rates below 2 or 3 percent in close-in Seattle submarkets. The Spokane area's rental market is still relatively soft, with vacancy rates in the 8- to 10-percent range. Tri-Cities area market conditions have improved significantly in the past 12 months, with apartment vacancy rates falling to 5 to 6 percent recently, compared with 9 percent a year earlier. Market conditions are holding balanced in the Boise area; the rental vacancy rate was about 6 percent at year's end, compared with 5 percent a year earlier.

Spotlight on Portland-Vancouver, Oregon-Washington

Employment in the Portland-Vancouver area during the 12-month period ending in November 1999 increased almost 2 percent, or 23,700 jobs, compared with 2.4 percent for the comparable period in 1998. The unemployment rate as of the end of November 1999 was just 3.8 percent, compared with 4.1 percent a year earlier. Employment growth during 2000 is expected to continue at about the 2-percent annual rate.

Single-family building permit activity during 1999 totaled 10,684 units, down 5 percent from 1998, the second strongest year in the decade. Home construction activity has slowed in response to a reduction in demand that resulted from slower employment growth and in-migration. From 1990 to 1998, the population in the Portland-Vancouver area grew at an average annual rate of 2.6 percent, but growth slowed to 2 percent during 1998 and held at about that level during 1999.

Sales of new and existing single-family homes totaled 28,462 through November 1999, down 3.4 percent from the same period in 1998. The median sales price was $158,200, a 2.6-percent increase from a year earlier. During the early and mid-1990s, the annual increases in sales prices were among the highest in the Nation. Local sales data indicate that the annual rate of increase reached a peak at 10 percent in 1996, then dropped to 8 percent in 1997 and 4 percent in 1998. With the slower rate of sales, the inventory of homes available increased in 1999. As of November 1999, there was a 7.5-month supply of homes, compared to a 6-month inventory in November 1998 and a 5-month supply in November 1996. The outlook for 2000 is for continued slackening of home sales as mortgage rates edge up and demand remains stable. Sales in the previously hot condominium market in the Portland-Vancouver area have also slowed in 1999. Sales through November were off 5.4 percent, compared with the same period in 1998. The average sales price of a condominium unit sold during 1999 was $138,000.

The rental housing market in the Portland-Vancouver area is currently balanced but is expected to tighten in the coming year. After reaching 7 percent in second-quarter 1999, the vacancy rate for rental housing fell to 6 percent by year's end. The sharp decline in the pipeline volume of new apartment developments entering the market during the past 3 years has helped to improve rental market conditions. Multifamily building permit activity has declined significantly in the area, dropping from 8,400 units in 1997 to 6,575 units in 1998 and 4,325 units in 1999. Rent increases have been minimal recently. As of mid-1999, average rents were slightly below $600 for 1-bedroom units, approximately $750 for 2-bedroom units, and approximately $850 for 3-bedroom units.