Economic and Housing Market Outlook By Lawrence Yun, Ph.D. Chief Economist, National Association of REALTORS Presentations At Raleigh Regional Association of REALTORS At Orange-Chatham Association of REALTORS At Durham Regional Association of REALTORS November 15 and 16, 2016
1990 - Q1 1991 - Q1 1992 - Q1 1993 - Q1 1994 - Q1 1995 - Q1 1996 - Q1 1997 - Q1 1998 - Q1 1999 - Q1 2000 - Q1 2001 - Q1 2002 - Q1 2003 - Q1 2004 - Q1 2005 - Q1 2006 - Q1 2007 - Q1 2008 - Q1 2009 - Q1 2010 - Q1 2011 - Q1 2012 - Q1 2013 - Q1 2014 - Q1 2015 - Q1 2016 - Q1 Lifetime Wealth at near All-Time High 100000 90000 80000 70000 60000 50000 40000 30000 20000 10000 0
Median Household Income (Inflation Adjusted) $59,000 $58,000 $57,000 $56,000 $55,000 $54,000 $53,000 $52,000 $51,000 $50,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
1950 1952 1954 1956 1958 1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 Annual GDP 10 Below 3% for 11 straight years GDP Annual Growth Rate 8 6 4 2 0-2 -4
2000 - Q1 2000 - Q3 2001 - Q1 2001 - Q3 2002 - Q1 2002 - Q3 2003 - Q1 2003 - Q3 2004 - Q1 2004 - Q3 2005 - Q1 2005 - Q3 2006 - Q1 2006 - Q3 2007 - Q1 2007 - Q3 2008 - Q1 2008 - Q3 2009 - Q1 2009 - Q3 2010 - Q1 2010 - Q3 2011 - Q1 2011 - Q3 2012 - Q1 2012 - Q3 2013 - Q1 2013 - Q3 2014 - Q1 2014 - Q3 2015 - Q1 2015 - Q3 20000 19000 18000 17000 16000 15000 14000 13000 12000 11000 10000 $ billion Sluggish GDP and Gap after Recession ($2.5 trillion gap $7,000 per person) 3% Growth Line Slow 2% Growth Line
Sluggish Business Spending Despite High Profit 2500 2000 1500 1000 Profits Business Spending 500 0
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan 2016 150,000 145,000 In thousands Jobs (8 million lost 15 million gained) 140,000 135,000 130,000 125,000 120,000
Non-farm Employment Growth By State
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan 2016 Jobs in Durham-Chapel Hill 310 300 In thousands 290 280 270 260 250
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan 2016 Jobs in Raleigh 650 600 550 500 450 400
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan 2016 Jobs in Greensboro-High Point 390 380 370 360 350 340 330 320 310 300
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan 2016 Jobs in Rocky Mount 75 70 65 60 55 50
1990 - Jan 1990 - Aug 1991 - Mar 1991 - Oct 1992 - May 1992 - Dec 1993 1994 - Feb 1994 - Sep 1995 - Apr 1995 - Nov 1996 - Jun 1997 - Jan 1997 - Aug 1998 - Mar 1998 - Oct 1999 - May 1999 - Dec 2000 2001 - Feb 2001 - Sep 2002 - Apr 2002 - Nov 2003 - Jun 2004 - Jan 2004 - Aug 2005 - Mar 2005 - Oct 2006 - May 2006 - Dec 2007 2008 - Feb 2008 - Sep 2009 - Apr 2009 - Nov 2010 - Jun 2011 - Jan 2011 - Aug 2012 - Mar 2012 - Oct 2013 - May 2013 - Dec 2014 2015 - Feb 2015 - Sep 2016 - Apr Employment Rate: Men vs Women 80 75 70 65 60 55 50 45 40
Housing Market Turning?
Annual Home Sales 9000000 8000000 7000000 6000000 5000000 4000000 3000000 New Existing 2000000 1000000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Median and Average Home Price 300000 250000 200000 150000 100000 50000 Median Average 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Dollar Volume Growth Rate % 30 20 10 0-10 20.7 18.2 19.0 15.5 13.9 15.2 10.9 8.8 7.0 4.3 0.9 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016-8.0-5.6-2.1-1.1-20 -30-23.0-25.5
Triangle Area Housing Stats Closings up 10% year-to-date Price up 5% Inventory down 16% Months Supply 3 months
1995 - Q1 1995 - Q4 1996 - Q3 1997 - Q2 1998 - Q1 1998 - Q4 1999 - Q3 2000 - Q2 2001 - Q1 2001 - Q4 2002 - Q3 2003 - Q2 2004 - Q1 2004 - Q4 2005 - Q3 2006 - Q2 2007 - Q1 2007 - Q4 2008 - Q3 2009 - Q2 2010 - Q1 2010 - Q4 2011 - Q3 2012 - Q2 2013 - Q1 2013 - Q4 2014 - Q3 2015 - Q2 2016 - Q1 Home Price Index - NC 200 180 160 140 120 Raleigh Durham-Chapel Hill 100
2007 - Q1 2007 - Q2 2007 - Q3 2007 - Q4 2008 - Q1 2008 - Q2 2008 - Q3 2008 - Q4 2009 - Q1 2009 - Q2 2009 - Q3 2009 - Q4 2010 - Q1 2010 - Q2 2010 - Q3 2010 - Q4 2011 - Q1 2011 - Q2 2011 - Q3 2011 - Q4 2012 - Q1 2012 - Q2 2012 - Q3 2012 - Q4 2013 - Q1 2013 - Q2 2013 - Q3 2013 - Q4 2014 - Q1 2014 - Q2 2014 - Q3 2014 - Q4 2015 - Q1 2015 - Q2 2015 - Q3 2015 - Q4 2016 - Q1 2016 - Q2 Home Price Index CO and PA 290 270 250 230 210 190 170 150 Allentown Denver
NAR HOME Survey (March 2015 to September 2016) Do you believe that now is a good time to BUY a home or not? YES 90% 85% 80% 75% 70% 65% 60% 55% 50% 315 415 515 615 715 815 915 1015 1115 1215 116 216 316 416 516 616 716 816 916
NAR HOME Survey (March 2015 to September 2016) Do you believe that now is a good time to BUY a home or not? NO 35% 30% 25% 20% 15% 10% 5% % 315 415 515 615 715 815 915 1015 1115 1215 116 216 316 416 516 616 716 816 916
REALTOR Buyer Traffic Index (% change from a year ago) 100 80 60 40 20 0-20 -40
Jan 7 2011 Mar 18 2011 May 27 2011 Aug 5 2011 Oct 14 2011 Dec 23 2011 Mar 2 2012 May 11 2012 Jul 20 2012 Sep 28 2012 Dec 7 2012 Feb 15 2013 Apr 26 2013 Jul 5 2013 Sep 13 2013 Nov 22 2013 Jan 31 2014 Apr 11 2014 Jun 20 2014 Aug 29 2014 Nov 7 2014 Jan 16 2015 Mar 27 2015 Jun 5 2015 Aug 14 2015 Oct 23 2015 Jan 1 2016 Mar 11 2016 May 20 2016 Jul 29 2016 60 50 40 30 20 10 0-10 -20-30 -40-50 Mortgage Purchase Applications (% change from a year ago)
2011 - Jan 2011 - Mar 2011 - May 2011 2011 - Sep 2011 - Nov 2012 - Jan 2012 - Mar 2012 - May 2012 2012 - Sep 2012 - Nov 2013 - Jan 2013 - Mar 2013 - May 2013 2013 - Sep 2013 - Nov 2014 - Jan 2014 - Mar 2014 - May 2014 2014 - Sep 2014 - Nov 2015 - Jan 2015 - Mar 2015 - May 2015 2015 - Sep 2015 - Nov 2016 - Jan 2016 - Mar 2016 - May 2016 Monthly Mortgage Payment for Buyers 1000 950 900 850 800 750 700 650 600 550 500
2011 - Jan 2011 - Mar 2011 - May 2011 2011 - Sep 2011 - Nov 2012 - Jan 2012 - Mar 2012 - May 2012 2012 - Sep 2012 - Nov 2013 - Jan 2013 - Mar 2013 - May 2013 2013 - Sep 2013 - Nov 2014 - Jan 2014 - Mar 2014 - May 2014 2014 - Sep 2014 - Nov 2015 - Jan 2015 - Mar 2015 - May 2015 2015 - Sep 2015 - Nov 2016 - Jan 2016 - Mar 2016 - May 2016 2016 - Sep Pending Home Sales Index (Seasonally Adjusted) 120 115 110 105 100 95 90 85 80
Rent Growth (% change from a year ago) 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0
Market Turning? Not Clear, though weakening momentum
Do You Ever Want to Own a Home in Future? 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% % 315 415 515 615 715 815 915 1015 1115 1215 116 216 316 416 516 616 716 816 916 Yes No
Homeownership Rate At Near 50-year low 70 69 68 67 66 65 64 63 62 61 60 1965 - Q1 1968 - Q1 1971 - Q1 1974 - Q1 1977 - Q1 1980 - Q1 1983 - Q1 1986 - Q1 1989 - Q1 1992 - Q1 1995 - Q1 1998 - Q1 2001 - Q1 2004 - Q1 2007 - Q1 2010 - Q1 2013 - Q1 2016 - Q1
Younger Households Less Likely to Own a Home 100% Homeownership Rate 2004 (Peak) 2016 Q2 80% 60% 40% 20% 0% Source: Census Bureau 34 and younger 65 and older
Wealth Gap Between Young Adults (under-35) and Retiree (65+) $250,000 $200,000 $150,000 $100,000 Median net worth of households headed by $120,524 $210,500 $230,000 $50,000 $0 $15,260 $10,460 $8,500 1983 2013 2016 est.
Student Loan 1600 1400 1200 1000 800 600 400 200 0 2006 - Q1 NAR-ASA Study implies 5 year Delay (in $billion) 20062007200720082008200920092010201020112011201220122013201320142014201520152016 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1 - Q3 - Q1
Consumer Price Index over the Long Haul (Rental Income > CPI by 25%) 350 300 250 200 150 100 Rent CPI 50 0 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015
Consumer Price Index over the Long Haul 600 500 400 300 200 Medical Rent CPI 100 0 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015
Consumer Price Index over the Long Haul 900 800 700 600 500 400 300 200 100 0 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 Tuition Medical Rent CPI
Social Benefits to Homeownership Higher student test score Lower juvenile delinquency rate Better health outcome and higher self-esteem from having a sense of control in life Increased charitable donations and volunteering Local civic engagement All benefits goes away if foreclosure therefore need sustainable homeownership
2005 - Q1 2005 - Q2 2005 - Q3 2005 - Q4 2006 - Q1 2006 - Q2 2006 - Q3 2006 - Q4 2007 - Q1 2007 - Q2 2007 - Q3 2007 - Q4 2008 - Q1 2008 - Q2 2008 - Q3 2008 - Q4 2009 - Q1 2009 - Q2 2009 - Q3 2009 - Q4 2010 - Q1 2010 - Q2 2010 - Q3 2010 - Q4 2011 - Q1 2011 - Q2 2011 - Q3 2011 - Q4 2012 - Q1 2012 - Q2 2012 - Q3 2012 - Q4 2013 - Q1 2013 - Q2 2013 - Q3 2013 - Q4 2014 - Q1 2014 - Q2 2014 - Q3 2014 - Q4 2015 - Q1 2015 - Q2 2015 - Q3 2015 - Q4 2016 - Q1 2016 - Q2 12.0 10.0 8.0 6.0 4.0 Borrowers Not Defaulting (Serious Delinquency Rate) U.S. All Mortgages NC Mortgages Veterans Affairs Mortgages 2.0 0.0
2008 - Oct 2009 - Jan 2009 - Apr 2009 2009 - Oct 2010 - Jan 2010 - Apr 2010 2010 - Oct 2011 - Jan 2011 - Apr 2011 2011 - Oct 2012 - Jan 2012 - Apr 2012 2012 - Oct 2013 - Jan 2013 - Apr 2013 2013 - Oct 2014 - Jan 2014 - Apr 2014 2014 - Oct 2015 - Jan 2015 - Apr 2015 2015 - Oct 2016 - Jan 2016 - Apr 2016 Distressed Property Sales (% of Total Sales) 60 50 40 30 20 10 0 Short Sale Foreclosure
Inventory of Homes per 100 Households 4.0 3.5 3.0 2.5 2.0 1.5 1.0 2000 - Jan 2001 - Jan 2002 - Jan 2003 - Jan 2004 - Jan 2005 - Jan 2006 - Jan 2007 - Jan 2008 - Jan 2009 - Jan 2010 - Jan 2011 - Jan 2012 - Jan 2013 - Jan 2014 - Jan 2015 - Jan 2016 - Jan
2000 - Jan 2000 - Jun 2000 - Nov 2001 - Apr 2001 - Sep 2002 - Feb 2002 2002 - Dec 2003 - May 2003 - Oct 2004 - Mar 2004 - Aug 2005 - Jan 2005 - Jun 2005 - Nov 2006 - Apr 2006 - Sep 2007 - Feb 2007 2007 - Dec 2008 - May 2008 - Oct 2009 - Mar 2009 - Aug 2010 - Jan 2010 - Jun 2010 - Nov 2011 - Apr 2011 - Sep 2012 - Feb 2012 2012 - Dec 2013 - May 2013 - Oct 2014 - Mar 2014 - Aug 2015 - Jan 2015 - Jun 2015 - Nov 2016 - Apr 2016 - Sep 2000 1800 1600 1400 1200 1000 800 600 400 200 0 Single-family Housing Permits and Starts Thousand units Grossly Inadequate
2014 - Jan 2014 - Feb 2014 - Mar 2014 - Apr 2014 - May 2014 - Jun 2014 2014 - Aug 2014 - Sep 2014 - Oct 2014 - Nov 2014 - Dec 2015 - Jan 2015 - Feb 2015 - Mar 2015 - Apr 2015 - May 2015 - Jun 2015 2015 - Aug 2015 - Sep 2015 - Oct 2015 - Nov 2015 - Dec 2016 - Jan 2016 - Feb 2016 - Mar 2016 - Apr 2016 - May 2016 - Jun 2016 2016 - Aug 2016 - Sep Monthly New Home Sales 650 600 550 500 450 400 350 300 Thousand units
Raleigh Housing Permits 20000 18000 16000 14000 12000 10000 8000 6000 4000 2000 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Durham-Chapel Hill Housing Permits 6000 5000 4000 3000 2000 1000 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan 2016 Median Price $350,000 $300,000 $250,000 $200,000 $150,000 Existing New $100,000
If Housing Shortage Persist Then Rent Control Vancouver 15% foreign buyer tax Huey Long Confiscate all second homes
2000 - Jan 2000 - May 2000 - Sep 2001 - Jan 2001 - May 2001 - Sep 2002 - Jan 2002 - May 2002 - Sep 2003 - Jan 2003 - May 2003 - Sep 2004 - Jan 2004 - May 2004 - Sep 2005 - Jan 2005 - May 2005 - Sep 2006 - Jan 2006 - May 2006 - Sep 2007 - Jan 2007 - May 2007 - Sep 2008 - Jan 2008 - May 2008 - Sep 2009 - Jan 2009 - May 2009 - Sep 2010 - Jan 2010 - May 2010 - Sep 2011 - Jan 2011 - May 2011 - Sep 2012 - Jan 2012 - May 2012 - Sep 2013 - Jan 2013 - May 2013 - Sep 2014 - Jan 2014 - May 2014 - Sep 2015 - Jan 2015 - May No CPI Inflation Yet 6 5 4 3 2 1 0-1 -2-3
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan Fed Policy and Mortgage Rate 9 8 7 6 5 4 3 2 1 0 Mortgage Rate Fed Funds Rate
Fed Rate Hike in December 15 Next hike in December 16? then again in
2000 - Jan 2000 2001 - Jan 2001 2002 - Jan 2002 2003 - Jan 2003 2004 - Jan 2004 2005 - Jan 2005 2006 - Jan 2006 2007 - Jan 2007 2008 - Jan 2008 2009 - Jan 2009 2010 - Jan 2010 2011 - Jan 2011 2012 - Jan 2012 2013 - Jan 2013 2014 - Jan 2014 2015 - Jan 2015 2016 - Jan 2016 Federal Revenue and Spending 4000000 3500000 3000000 2500000 2000000 1500000 Rolling 12-month total, in $million Spending Revenue
2001 - Jan 2001 - May 2001 - Sep 2002 - Jan 2002 - May 2002 - Sep 2003 - Jan 2003 - May 2003 - Sep 2004 - Jan 2004 - May 2004 - Sep 2005 - Jan 2005 - May 2005 - Sep 2006 - Jan 2006 - May 2006 - Sep 2007 - Jan 2007 - May 2007 - Sep 2008 - Jan 2008 - May 2008 - Sep 2009 - Jan 2009 - May 2009 - Sep 2010 - Jan 2010 - May 2010 - Sep 2011 - Jan 2011 - May 2011 - Sep 2012 - Jan 2012 - May 2012 - Sep 2013 - Jan 2013 - May 2013 - Sep 2014 - Jan 2014 - May 2014 - Sep 2015 - Jan 2015 - May 2015 - Sep 2016 - Jan 2016 - May 2016 - Sep Federal Debt (Held by Public, excluding intergovernmental obligations) 16000000 14000000 12000000 10000000 8000000 6000000 4000000 2000000 0
Tom Barrack Real Estate Market is Getting Bubblicious
2000 - Q1 2000 - Q3 2001 - Q1 2001 - Q3 2002 - Q1 2002 - Q3 2003 - Q1 2003 - Q3 2004 - Q1 2004 - Q3 2005 - Q1 2005 - Q3 2006 - Q1 2006 - Q3 2007 - Q1 2007 - Q3 2008 - Q1 2008 - Q3 2009 - Q1 2009 - Q3 2010 - Q1 2010 - Q3 2011 - Q1 2011 - Q3 2012 - Q1 2012 - Q3 2013 - Q1 2013 - Q3 2014 - Q1 2014 - Q3 2015 - Q1 2015 - Q3 2016 - Q1 Commercial Property Price may be Bubblish 300 250 200 150 100 50 0 Source: Federal Reserve
Rising Cap Rates and Commercial Real Estate Prices Steady prices in mid-tier markets Price drops in trophy properties Green Street price index could fall 4% to 8% over the next two years
Forecast
Normal vs. Now 2000 (Likely Normal) 2016 Existing Home Sales 5.2 million 5.3 million New Home Sales 900,000 500,000 Population 282 million 324 million Jobs 132 million 145 million Total U.S. Household Wealth $44 trillion $85 trillion
Post-College Likely Renters (Age 25 to 29) 25000 24000 In thousands 23000 22000 21000 20000 19000 18000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Likely First-time Buyers (Age 30 to 39) 24000 In thousands 23000 22000 21000 20000 19000 18000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 30-34 35-39
Likely Trade-Up Buyers (Age 40 to 49) 24000 In thousands 23000 22000 21000 20000 19000 18000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 40-44 45-49
Vacation Home Buyers (Age 50 to 59) 23000 22000 21000 20000 19000 18000 17000 16000 15000 In thousands 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 50-54 55-59
Retired - Relocation (Age 60+) 80000 In thousands 75000 70000 65000 60000 55000 50000 45000 40000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 Percentage Living with Mom (2.5 million above Norm) 58 56 54 52 50 48 46 44 18-25 16 14 12 10 8 6 4 2 0 26-35
2000 - Jan 2000 - Jun 2000 - Nov 2001 - Apr 2001 - Sep 2002 - Feb 2002 2002 - Dec 2003 - May 2003 - Oct 2004 - Mar 2004 - Aug 2005 - Jan 2005 - Jun 2005 - Nov 2006 - Apr 2006 - Sep 2007 - Feb 2007 2007 - Dec 2008 - May 2008 - Oct 2009 - Mar 2009 - Aug 2010 - Jan 2010 - Jun 2010 - Nov 2011 - Apr 2011 - Sep 2012 - Feb 2012 2012 - Dec 2013 - May 2013 - Oct 2014 - Mar 2014 - Aug 2015 - Jan 2015 - Jun 2015 - Nov 2016 - Apr 2016 - Sep 450 400 350 300 250 200 150 100 50 0 Multifamily Housing Starts (12 month average; in thousands)
Economic Forecast 2015 2016 Likely 2017 Forecast 2018 Forecast GDP Growth 2.6% 1.5% 2.1% 2.5% Job Growth +2.6 million +2.0 million +2.1 million +2.4 million CPI Inflation 0.3% 1.2% 2.5% 2.5%
Housing Forecast 2015 2016 Likely 2017 Forecast 2018 Forecast New Home Sales Existing Home Sales Median Price Growth 500,000 570,000 620,000 700,000 5.3 million 5.4 million 5.5 million 5.7 million + 6.8% +4.0% 4.2% 2.5% 30-year Rate 3.9% 3.6% 4.1% 4.5%
Normal vs. Now 2000 (Likely Normal) 2015 Existing Home Sales 5.2 million 5.2 million New Home Sales 900,000 500,000 Population 282 million 320 million Jobs 132 million 144 million Total U.S. Household Wealth $44 trillion $85 trillion
Commercial Real Estate Forecast 2016-2017 Vacancy Rent Apartment From 4.7% to 5.0% 3.5% per year Office From 13% to 12% 4% per year Industrial Stable at near 9% 4% per year Retail Stable at near 11% 2% per year
Trump Presidency Dodd-Frank? Need Construction Workers Community College Training Fannie/Freddie and Mortgage Availability? Tax Simplification? Natural Disaster and Flood Insurance? EPA, land use, development fees?