u.s., florida & orange county economic update 2015 economic summit orlando, fl december 15 th,...
TRANSCRIPT
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U.S., Florida & Orange County Economic Update
2015 Economic Summit
Orlando, FLDecember 15th, 2015
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Economic Policy Uncertainty
Health Care Reform
Employer mandates Impact on labor market
Dodd-Frank Financial Regulatory Reform
Impact on credit flows & financial sector 37.1% (104 – 94 without proposals)
Fiscal Policy
Monetary Policy
When will interest rate hikes commence?
Labor market/wage growth
How will financial markets react?
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U.S. Forecast
171615141312111009080706050403020100
145.0
140.0
135.0
130.0
125.0
Total Nonfarm Payroll Employment(Millions)
Total Nonfarm Employment
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U.S. Forecast Payroll jobs to reach potential
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U.S. Forecast Missing Workers
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U.S. Forecast
171615141312111009080706050403020100
10.0
9.0
8.0
7.0
6.0
5.0
4.0
3.0
Civilian Unemployment Rate(%)
Unemployment Rate
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U.S. ForecastUnemployment if “missing workers” were found
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U.S. Economic Outlook
2014Q2
2014Q3
2014Q4
2014 2015 2016 2017
GDP% Change, Annual
Rate4.6 5.0 2.4 2.3 2.5 2.7 2.9
Consumer Price Index% Change, Annual
Rate3.0 1.1 -1.2 1.6 0.4 1.9 2.2
Consumer Sentiment 82.8 83.0 89.8 84.1 90.4 89.5 88.9
Consumption% Change, Annual
Rate2.5 2.2 2.6 2.4 2.9 3.0 2.8
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U.S. Forecast
The Arithmetic of Higher Oil Prices:
Each $1 decrease in the price of a barrel of oil will:
Decrease price of gallon of gas 2.5 cents Push consumer gasoline bills down $3
billion Lower the CPI 0.03% Raise real disposable income 0.25%
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U.S. Forecast The Economics of lower Oil
Prices:
Each permanent $10 decrease in the price of a barrel of oil will:
Raise forecast real GDP growth 0.2% in 1st year,
0.5% in the 2nd
Raise forecast of payroll employment 110,000 in 1st year and 390,000 in 2nd
Psychic Impact
Domestic production impacts?
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U.S. Forecast
171615141312111009080706050403020100
9.0
8.0
7.0
6.0
5.0
4.0
3.0
2.5
2.0
1.5
1.0
0.5
0.0
30-Year Mortgage Rates and Housing Starts(Mortgage rates - Left axis, %)
30-Year Fixed Mortgage RateHousing Starts - Millions
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Florida Housing Market
Housing market recovery continues
Now single-digit price appreciation
Still high level of investor activity
Housing finance still an issue
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Florida Housing Market
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Florida Housing Market
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November 2014
November 2013 Percent
change
Closed Sales 17,772 16,061 10.7%
Median Sale Price
$176,000 $170,000 3.5%
Median Days on Market
54 49 10.2%
Inventory(Months Supply)
5.3 5.6 -4.8%
Florida Housing Market
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Florida Housing Market
Investors are still active in Florida residential real estate
Still high share of cash transactions
Private equity, hedge funds international buyers
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Median Monthly
Rent
Median Home Price Annual yield
January2012 $1,233 $129,000 11.5%
January-2013 $1,289 $145,000 10.7%
January-2014 $1,395 $163,000 10.3%
November-2014 $1,420 $176,000 8.1%
Housing MarketCash Sales
Why are investors still active in Florida residential real estate?
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November 2014
November 2013
Cash as % of November 2014 Sales
Florida 6,961 7,048 39.2%
Miami 1,292 1,393 41.9%
Tampa 1,224 1,098 39.1%
Jacksonville 439 428 32.4%
Orlando 723 731 33.0%
Housing MarketCash Sales
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Florida Forecast
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Florida Forecast
171615141312111009080706050403020100
300.0
250.0
200.0
150.0
100.0
50.0
0.0
9%
8%
7%
6%
5%
4%
3%
Florida Housing Starts(thousands)
Total Private Housing Starts30 year Mortgage Rates
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Florida Forecast
171615141312111009080706050403020100
21000.0
20000.0
19000.0
18000.0
17000.0
16000.0
15000.0
Florida Population(Thousands)
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Florida Forecast
171615141312111009080706050403020100
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
Florida & U.S. Unemployment Rate(%)
FL Unemployment RateU.S. Unemployment Rate
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Florida Forecast
171615141312111009080706050403020100
10%
5%
0%
-5%
-10%
Florida Real Gross State Product(% change year ago)
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Florida Forecast
171615141312111009080706050403020100
8400.0
8200.0
8000.0
7800.0
7600.0
7400.0
7200.0
7000.0
6800.0
Florida Employment(Thousands)
Wage & Salary Employment
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Florida Forecast
171615141312111009080706050403020100
700.0
600.0
500.0
400.0
300.0
Florida Construction Employment(Thousands)
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Florida Forecast
171615141312111009080706050403020100
1300.0
1200.0
1100.0
1000.0
900.0
800.0
Florida Professional & Business Services Employment
(Thousands)
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Florida Forecast
171615141312111009080706050403020100
1150.0
1100.0
1050.0
1000.0
950.0
900.0
850.0
800.0
Florida Leisure & Hospitality Employment
(Thousands)
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2014-2017 Averages;Q4 2014 Forecast
Florida
Sector% Average Annual
Growth
Construction 9.2
Professional & Business Services 3.5
Trade, Transportation & Utilities 3.3
Leisure & Hospitality 2.0
Education-Health Services 1.9
Information 1.2Financial 0.9Manufacturing 0.6State & Local Government 0.5Federal Government -0.6
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RegionPopulation Growth
Average % Chg Rank
Florida 1.4 ---Deltona 1.2 7
Gainesville 0.8 11Jacksonville 1.4 4
Lakeland 1.0 9Miami 1.2 5Naples 2.4 1Ocala 1.6 3
Orlando 2.1 2Palm Bay 1.1 8Pensacola 0.6 12
Tallahassee 0.8 10Tampa 1.2 6
2014-2017 Averages;Q4 2014 Forecast
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RegionEmployment Growth
Average % Chg Rank
Florida 2.2 ---Deltona 1.7 7
Gainesville 1.1 12Jacksonville 2.3 3
Lakeland 1.5 9Miami 2.1 4Naples 2.9 1Ocala 1.5 8
Orlando 2.7 2Palm Bay 1.7 6Pensacola 1.3 11
Tallahassee 1.4 10Tampa 1.8 5
2014-2017 Averages;Q4 2014 Forecast
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2014-2017 Averages;Q4 2014 Forecast
Orlando MSA
Sector% Average Annual
Growth
Construction 8.6
Professional & Business Services 4.1
Leisure & Hospitality 2.9
Trade, Transportation & Utilities 2.4
Education-Health Services 2.2
Information 1.8
Manufacturing 1.2State & Local Government 1.1Financial 0.4Federal Government -0.4
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Orange County Forecast
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Sean M. SnaithSean M. Snaith, Ph.D.
Director Director
Institute for Economic CompetitivenessInstitute for Economic Competitiveness
(407) 823-1453(407) 823-1453
[email protected]@SeanSnaith.com
WWW.IEC.UCF.EDUWWW.IEC.UCF.EDU
www.facebook.com/seansnaith www.facebook.com/seansnaith
Twitter: @seansnaithTwitter: @seansnaith
Thank you