Consumer confidence is weaker, remodeling trends, off-price stores and more

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Consumer confidence is weaker than during the 2008 financial crisis link

• Consumer sentiment is falling fast across all income levels, with job loss fears reaching recession-era highs. A record number of households now believe business conditions are getting worse.

• Expectations for household income are dropping, while inflation expectations are rising faster than at any point in recent history. This combination is likely to hit spending hard in the coming months.

• The data suggests that weak consumer confidence may soon lead to a real pullback in actual consumer activity. This could ripple through broader economic indicators and slow growth across sectors.

Primary suites, kitchens, roofing lead remodel trends link

• Projects that brought the most homeowner joy were adding a primary suite, upgrading the kitchen, and installing a new roof. But modest projects like replacing a front door had the highest cost recovery, with steel doors recouping 100% of their cost.

• Only 9% of homeowners said affordability influenced their remodeling decisions, while 54% used home equity loans or lines of credit to fund the work. Most remodels were driven by worn-out materials, energy efficiency, or simply wanting a change.

• Contractors reported strong demand, with 42% seeing more projects and 57% noting bigger scopes. Paint jobs, roof replacements, and kitchen/bath upgrades saw the most interest in resale-focused remodels.

Off-price stores could sidestep most tariff downsides link

• TJ Maxx, Ross, and Burlington import less than 10% of their goods directly from China, buying most inventory domestically after tariffs are already paid. This shields them from the full impact of new tariff costs.

• As prices rise at traditional retailers, shoppers are shifting to off-price stores, which offer discounts of 20% to 60%. Shopper traffic rose at all three off-price chains in March, while it fell at Nike and Kohl’s.

• Trump’s rollback of the $800 duty-free exemption hits fast-fashion competitors like Shein and Temu. This may drive more budget-conscious shoppers toward physical off-price stores.

Industrial demand catching up to supply in Inland Empire link

• The Inland Empire saw 3.6M square feet of positive net absorption in Q1 2025, pushing the vacancy rate down to 6.6%—the first drop since Q3 2022. New leasing hit 11.7M square feet, with activity split between IE East (5.5M) and IE West (6.3M).

• Lease rates dropped to $1.12 per square foot per month, a 17.6% decline from Q1 2024. This marks the seventh straight quarter of falling rates as the market corrects from the pandemic-era boom.

• A surge in leasing was driven by Asian-based logistics firms stocking up ahead of potential U.S. tariffs. Burlington’s $257M purchase of a Riverside warehouse highlights a growing trend of large tenants buying instead of leasing.

Idaho real estate market forecast for 2025 link

• Home prices in Idaho are expected to rise by 4–6% in 2025, with stronger gains of 6–8% in Boise and more modest 2–4% growth in rural areas. Boise’s median home price of $450,000 remains far lower than Seattle or San Francisco, keeping the state attractive for buyers leaving high-cost metros.

• Housing inventory may increase by 8–10% due to a 15% rise in building permits and more seller activity, especially in cities like Kuna, Star, and Twin Falls. First-time buyers are shifting to smaller towns with 4.5 months of inventory on average.

• Mortgage rates are forecast to drop from 7.5% to the low 6% range in 2025, which could lower monthly payments by $250 on a $400,000 loan. Even a 1% rate drop may trigger a 10–12% surge in buyer interest, particularly in high-demand markets.

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