Over the last month, numbers and data regarding our region’s economic forecast for 2019 have begun to take shape. After a few years of recession in our area, things are finally starting to look up. And, when there’s a positive outlook on job and industry growth, the ripples can be felt throughout the region’s economy. Here’s what economists are predicting in the coming year and beyond.
Economic Forecast for 2019 and Beyond
Each fall, the Louisiana State University’s Department of Economics releases their annual Louisiana Economic Outlook which takes a long view on how the state is faring economically and makes predictions on future patterns of growth. This year’s LEO has a positive outlook on job growth in the coming year. For the New Orleans MSA (Metropolitan Statistical Area) the LEO is predicting an increase in jobs for 2019, adding 6,500 (+1.1%) and 9,100 jobs (+1.6% in 2020. Large industrial projects in Plaquemines Parish and St. James Parish are expected to lead this growth. The LEO also predicts a nice jump in tech sector jobs from companies DXC Technology, iMerit, and Accruent. It’s estimated that more than 2,000 jobs will be added to those companies, in addition to a labor expansion at Michaud. Tangipahoa Parish has grown to have its own MSA created – Hammond – and is also predicted to experience job growth, particularly in the healthcare sector. However, the area’s economic recovery has been led by the state’s record-setting industrial and construction boom that shows no signs of slowing down.
I should note, these predictions are supported by a few assumptions; namely that the national economy will continue to expand, interest rates will stay in check, and oil prices will rise modestly. The threats of tariffs and a trade war could alter the LEO’s forecast as time goes on.
What About Housing?
Nationally, experts have been predicting a slowdown in the real estate market due in part to rising mortgage interest rates. However, The Wall Street Journal states that mortgage rates as of the first week in January 2019 have fallen to their lowest in eight months. The average rate for a 30-year fixed rate mortgage dropped to 4.51%, the lowest rate since last spring. This rate drop gives potential buyers a chance to access the housing market at a lower interest rate while things are slightly soft. If you are looking to refinance, this dip in rates could signal now is a good time. With the market coming off of a volatile season and some downward pricing pressure, the real estate market is tipping toward the buyer. If you are on the fence, this dip in rates may help you decide now is the time.
While we don’t have a crystal ball to see what we can expect in the coming year, there are many positive indicators on the horizon.
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