The High Desert Report » February 2012

Monthly Archives: February 2012

Economy General

The High Desert’s Population Decline Appears To Be Substantially Overstated

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By Ronald J. Barbieri, Ph.D., CPA
February 9, 2012

Population estimates by Nielsen/Claritas indicate the Population of the High Desert declined from a high of 443,516 as of January 1, 2009 to 421,712 as of January 1, 2011. If the estimates are correct it would represent a population decrease of 21,804 or 4.9% over the two year period, which is significant.  The estimated loss in population in 2009 was 12,721 compared to 9,083 in 2010.  The rate of decline has diminished somewhat in the second year; but it is still large enough to raise concerns that the population may have continued shrinking in 2011, because of the lack of job formation in the Inland Empire.  When the population estimates by Nielsen/Claritas at the beginning of 2009 are compared to the 2010 U.S. Census counts for the High Desert the decline in population is only 2,139 over the 15-month period ending April 1, 2010. As of that date the Population of the High Desert was 441,377.

In December 2011 the U.S. Census Bureau released its population estimates for July 1, 2010 and July 1, 2011.  During the first 3-month period after the 2010 Census the population of California increased by 84,242; and for year ending July 1, 2011 it increased by 353,714.  This represents 15.4% of the population increase of the United States.  Births over deaths accounted for approximately 88% of California’s growth in population; so there was a net in migration of population during the 15 months following the 2010 Census. This was an encouraging sign that California is still able to attract more individuals than the number that migrate out of the state.

The Bradco Companies analyzes a substantial amount of demographic information to support our real estate brokerage and consulting activities, a portion of which was incorporated in the following Table that depicts the population estimates by Neilsen/Claritas for the first day of 2009, 2010, 2011 and 2016; and the annual changes in population during 2009 and 2010 and for the five year period that encompasses 2011 through 2015. This data is in the Orange section of the Table. The green section of the Table reflects the population counts for the 2010 Census and how they differ from the Nielsen/Claritas estimates for 2009, 2010 and 2011. This information is provided by zip code and grouped into the five cities and their areas of influence. The cities and zip codes are identified in the brown section of the table. The table also provides population information for the High Desert, San Bernardino and Riverside Counties and the State of California.

The counts from the 2010 Census are the best estimate of the each submarket’s population as of April 1, 2010. Demographic estimating companies such as Nielsen/Claritas and ESRI are still using 2000 Census counts to derive their January 1, 2011 and 2012 population estimates. The 2010 detailed Census data was released around the summer of last year.  It is now being used to recalibrate the models that will estimate the population for January 1, 2012.

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A comparison of the actual 2010 census counts to the Nielsen/Claritas estimates for January 1, 2009 revealed that that population of Adelanto increased by 1,098 over the 15-month period while the Town of Apple Valley’s two zip codes lost 4,622 inhabitants. The Barstow zip code suffered a decline of 1,563. The population of Northeast Barstow was down by 1,304; and the population of Fort Irwin decreased by 1,923.  In the 2010 Census the City of Hesperia and Oak Hills had a population of 110,595.  This was 7,887 more than the 1/1/2009 estimate by Nielsen/Claritas.  The Greater Hesperia area including Pinion Hills and Wrightwood experienced a population growth of 9,217 over the same 15-month period.  The three zip codes that include the City of Victorville saw a population decrease of 4,267.  The Greater Victorville area that also includes Helendale/Silver Lakes, Phelan/Baldy Mesa and Oro Grande realized a population decrease of 2,764.

The aforementioned population changes assume that the population estimates for the first day of 2009 were accurate.  There are indications some may have been overstated. The Census count for San Bernardino County was 32,280 less than Nielsen/Claritas estimated for 1/1/2009 and the count for California was 305,772 less than what had been estimated for that day. It is highly unlikely the population of California declined by such an amount in during the 15-month period. The more likely scenario in both cases is that the population as of 1/1/2009 had been overestimated. The models may have given too much weight to the completion of residential units in 2006 through 2008. During that period many homes received their Certificate of Occupancy; but they were not sold or occupied in the typical time frame. Because of such an overstatement it is possible the population of the High Desert actually increased during the 15-month period before the 2010 Census.

Conversely the population of the High Desert and some of its submarkets may have been underestimated for the beginning of 2010 and 2011. The models consider factors that act as proxies for vacant residential units, which have increased because many households have doubled up in order to reduce expenses. The models may be overestimating the loss of population caused by the increase in vacant housing units. Children may move back with their parents adding to the vacancy level; but not reducing the population. The consolidation of households because of the recession has likely resulted in lower population estimates than would normally be the case.

The number of children attending school has decreased, probably caused by the outmigration of construction workers from the High Desert. The decrease in the number of students has been significant; and would suggest a population decline.  On the other hand there is anecdotal evidence that retired people are moving to the High Desert, accelerated by the low cost of housing. It may be that the loss of population caused by the outmigration of families with children has been offset by the in migration of retired people.

It is unlikely there was any significant decrease in the population of the High Desert since the beginning of 2009. It may even be increasing.  The fact that there have been significant increases in taxable sales over the six quarters and home prices have not dropped substantially in the last 18 months, tend to collaborate a stable if not slightly expanding population scenario in the High Desert. Nevertheless some cities such as Barstow, Victorville and the Town of Apple Valley may have experienced population declines while the City of Hesperia and outlying areas like Oak Hills, Pinon Hills, Helendale/Silver Lakes, Phalen/Baldy Mesa benefited from a growth in population.

According to the 2000 Census the population of the High Desert was 305,909. In the 2010 Census the population reached 441,337, which represents an increase of 135,468 or 44.3% over the decade. Nielsen/Claritas estimates that the population of the High Desert will grow by 55,000 during the five year period ending in December 31, 2015. While this would represent a growth rate of 13.1%; or 59% of the rate for the last decade, it is nevertheless significantly positive and substantially higher than the 5% growth rate expected for the U.S. over the half decade.