EDITOR:
Earlier this month, in a single Sunday edition of the Nevada Appeal, there were three separate articles, each in a different section of the newspaper, but all with the same lessons to be learned. Douglas County can certainly learn some valuable lessons from the information provided.
In the business section was an article titled "Nevada's foreclosure rate leads nation." Nevada, which has been the fastest growing state in the country for decades, has far and away the highest foreclosure rate. The article states: "One in 27 homes in the state was in the foreclosure process, five times the national average."
In addition, Nevada leads the country in highest percentage of home mortgages "underwater," i.e. with negative equity. Fifty-five percent of mortgage holders in Nevada owe more on their mortgage than the value of their home, 15 percent higher than in any other state.
The front page article of the paper was: "15.2 percent ... Lyon County struggles with state's worst unemployment rate." Not unrelated is the fact Lyon County has been the fastest growing county in the state this decade, with over 60 percent growth, according to the State Demographer's estimates.
It stated that: "Lyon County's population growth that fueled construction and the jobs it brought earlier in the decade stopped suddenly last year."
It continued that "the county didn't have an industrial base to fall back on," and that "the county has cut services as much as possible ... and the level of service in the county is below national standards due to a lack of funds."
Likewise, Nye County, with the Nevada's second highest growth rate this decade (over 45 percent), had the state's second highest unemployment rate. Douglas County, with Nevada's fourth highest growth rate, had the state's fourth highest unemployment rate. I think you see the trend here.
The third article was about how some communities in the country have managed to escape the recent housing and financial crisis relatively unscathed. It focused in part on Fayetteville, N.C., where home values actually climbed 6.9 percent last year. It talked about how Fayetteville had managed to avoid some of the "practices that caused home prices to boom and bust in other parts of the country." They credited a strong local economy not overly reliant on residential growth, and a local real estate market that "never really got out of whack."
There are several lessons that can be learned from the above articles that should be helpful to all communities, including Douglas County. They include:
1) Every boom is inevitably followed by a bust. The bigger they come, the harder they fall.
2) Residential growth needs to follow job growth, not be the primary creator of job growth (see No. 1).
3) Residential growth needs to progress in a steady, stable fashion. Excessive growth is not sustainable.
Hopefully, when the local economy recovers (and it will), our county commissioners, county staff, and the residents of the county will have learned these important lessons. We can only hope.
Jim Slade
Gardnerville
