Area's economy beginning to rev

SANDPOINT — People are returning to Mike Hammersberg’s photo store looking for cameras.

They are not coming in droves, but the couple of people per week who slip through the glass door into his showroom could be a sign of something he has anticipated for two years: Recovery.

For Hammersberg, who with his wife Randi owns Image Maker Photo & Video on Sandpoint’s main street, the increased foot traffic is a bright spot in what has been a tough retail climate.

Two years ago when gasoline prices climbed to the $4 range stymieing tourism, the Hammersbergs saw a sharp drop in business.

Then began a two-year cycle where the photo-and-camera shop slid into the red without recourse or any sign of recovery.

“We’re still seeing red ink,” Hammersberg said.

This ink though, shows indications of rubbing off.

“In the second quarter we hope to see bottom,” he said. “And with any luck at all, by the third quarter in June, July, August we should see some numbers to say we are starting into recovery.”

That kind of optimism isn’t unique to Hammersberg.

The floundering economy of the past couple years has changed the way people save, invest and spend money, said Fred Dickson, chief marketing strategist and senior vice president of D.A. Davidson & Co.

Armed with a new outlook, Dickson said, people are slowly starting to spend again. They are making investments, vacation plans and are starting to feel comfortable that the worst is over.

Dickson likes to use the analogy of a car on a highway going gangbusters. That car suddenly hit the brakes two years ago, and its passengers — real people, investors, home and business owners — slammed against the dashboard.

They were shook up, there was damage to the vehicle, even some fatalities. Since then, though, the vehicle has been repaired and is back on the road with driver and passengers still skittish, but accelerating nonetheless.

“We were going 65 mph or faster when the financial crisis hit,” Dickson said. “We could have spun out of control but the antilock brakes took effect.”

The car stopped, but is moving again.

“We’re at 30 or 35 mph,” he said. “In absolute sales terms, that is better than zero.”

Mike Roos of McGovern Realty shares Hammersberg’s optimism.

The realty business relies on factors that include federal incentives to home buyers, interest rates and credit scores. Despite an array of factors that impact home sales, Roos foresees sales steadily increasing as potential home buyers who sat on the fence start taking advantage of market conditions.

“They are probably the same ones who could have purchased before,” Roos said.

Buyers have scaled back their expectations, aligning them instead with their pocketbooks. They are making concessions and leaving a financial buffer for future downturns.

“They are asking, ‘What can we afford?’ ‘What is a comfortable payment?’” Roos said. “Instead of, ‘What is exactly what I want?’”

He expects sales to pick up this summer. The unseasonably warm weather might help spur an increase sooner.

“I anticipate a good summer,” he said. “It’s definitely picking up. It can’t get any slower than it was.”

Across the parking lot from McGovern’s Michigan Street address, Michael Bovee operates Consumer Recovery Network, a national consumer help center that strives to get people out from under their dead weight of debt.

“Sometimes it’s as simple as belt tightening,” Bovee said.

His plans are designed to get consumers back into the black as quickly as possible, and business is booming.

Most of the people he talks to, he said, are seeing frugality in their future.

“I think people are getting wiser and smarter in how they see money, and the intelligent, wise use of it,” Bovee said.

That could mean spending money at home and not stretching credit. Local or regional getaways will replace Hawaiian vacations and that will impact Main Street, said Dickson.

People will spend time at the lake instead of time on the road, or in the air going exotic.

“I think as residents within 400 or 500 miles of here start feeling more secure in their current job, more confident in their homes, you’ll see a modest uptick in tourism and resort business traffic,” he said.

That is good news for downtown America, he said.

“The varying degree of hardships are possibly lessening,” he said.

For Hammersberg, the hardship was softened by local shoppers who continued to support the business.

“Our survival really depended on the local people,” he said. “By June it will have been two years and we hope by then, the slide will have stopped.”