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Economic Outlook What a Difference a Year Makes

Economic Outlook What a Difference a Year Makes. Presentation to Frederick County Association of Realtors® May 1, 2013 Danielle Hale, Economist. RESEARCH. Today’s Presentation. National Economic update Quick look at Local Jobs Market NAR Resources Mid Year Meetings Preview

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Economic Outlook What a Difference a Year Makes

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  1. Economic OutlookWhat a Difference a Year Makes Presentation to Frederick County Association of Realtors® May 1, 2013 Danielle Hale, Economist

  2. RESEARCH Today’s Presentation • National Economic update • Quick look at Local Jobs Market • NAR Resources • Mid Year Meetings Preview • Keep up to date on national economic trends • Get local economic information • Get information on NAR Members, Home Buyers and Home Sellers

  3. Where are we now?

  4. RESEARCH Back to Normal? • The last recession ended nearly 4 years ago in June 2009 • The December 2007 to June 2009 Recession was the longest since the Great Depression • Consumer spending has returned and growth is back to normal, but the lessons of the recession are not completely forgotten

  5. RESEARCH GDP is Growing and Modestly Above Trend Source: BEA

  6. RESEARCH Consumer Spending & Investment Drive Growth Source: BEA

  7. RESEARCH Consumers Doing Well but Wary Source: University of Michigan and The Conference Board

  8. RESEARCH Private Employment is nearly fully recovered 6.5 million private payroll jobs gained Employment Data Release tomorrow: expect an additional 100 – 150 thousand jobs Source: BLS

  9. Where is the Inflation?

  10. RESEARCH Real Estate – the source of growth • Residential: Existing home sales steady and new home construction rebounding strongly • Commercial: returning strongly

  11. Household Formation

  12. A closer look at housing…

  13. RESEARCH Existing Home Sales Source: NAR

  14. RESEARCH New Home Sales Source: Census

  15. RESEARCH Nationally, Home Prices are Rising Other price measures show similar trends. Source: NAR and Census

  16. RESEARCH Market Demand has Limited Inventory Source: NAR

  17. RESEARCH Low building in the recent past helped create inventory shortfall Source: Federal Reserve/Freddie Mac

  18. Consumers are more sanguine on house prices than they have been in years

  19. Outlook

  20. RESEARCH Outlook • Continued Moderate GDP Expansion 2.5% - 3.0% in the next 2 years (historical average is 3%) • 1 - 2 million net new jobs per year • Unemployment rate of 7.5% in 2013 and continued declines

  21. RESEARCH Outlook • Continued low mortgage rates as the Fed continues to keep rates low. Expect less than 4 percent for most of 2013 and under 5 percent for 2014 • Home values – strong growth in 2013 and easing back to normal in 2014 and beyond • Housing Starts to rise substantially in 2013 to finally break 1,000,000 again and return to normal 1-1.5 million per year replacement pace • Home sales back to normal; will grow with jobs

  22. Forecast

  23. Frederick Market

  24. RESEARCH Local Market Information - March 2013 Source: BLS

  25. RESEARCH Household Survey for Washington Metro Area, DC-MD-VA-WV

  26. RESEARCH Household Survey for Bethesda-Rockville-Frederick, MD

  27. RESEARCH Household Survey for Frederick, MD

  28. RESEARCH Frederik County Existing Home Sales – 3moMA Source: NAR

  29. NAR Resources

  30. RESEARCH Mid Year Meetings Preview • Residential Economic Issues & Trends ForumMay 16, 2013 | 8:00 AM - 10:00 AMLocation: Marriott Wardman Park Hotel • NAR’s Chief Economist will discuss prospects for the economy in the second half of 2013. He will be joined by the Vice President and Senior Regional Officer at the Federal Reserve Board of Cleveland who is expected to discuss changes intended to revive the private sector’s role in mortgage finance and how these changes may impact the real estate industry.  • Commercial Economic Issues & Trends ForumMay 16, 2013   |  1:00 PM - 3:00 PMLocation: Omni Shoreham Hotel • NAR's Chief Economist and a panel of commercial experts will focus on how commercial real estate markets are performing amidst economic and regulatory challenges. They will explore the state of commercial real estate (CRE) market fundamentals and direction of investments, provide an update about asset valuations in light of continuing CRE loan maturities and discuss legislative and regulatory impact upon CRE lending. 

  31. RESEARCH NAR Market Information • Reduced Cost for Members: • Profile of Home Buyers and Sellers – Annual • Member Profile – Annual • FREE: • Realtors® Confidence Index - Monthly • Local Market Reports – Available Quarterly • Relocation Reports – Annual

  32. RESEARCH Other Research Information Available DAILY • Forecast Updates, Commentary, Maps, Data, Videos, Webinars, Presentations • Bloghttp://economistsoutlook.blogs.realtor.org/ • Facebook: http://www.facebook.com/narresearchgroup • Twitter:http://twitter.com/NAR_Research • Website:http://www.realtor.org/research-and-statistics

  33. RESEARCH

  34. Questions? Contact me at dhale@realtors.org 202-383-7511

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