Though the U.S. economy has technically recovered from the great recession of 2009 to 2011, GDP growth remains sluggish at 2% and the nation’s employment rate is hovering around 60%—not much greater than it was at the height of the recession.
One of the results of that dynamic is that the nation’s rental population has increased by eight million people in the past decade, while the home-owning population has declined by two million during the same period to a 20-year low, according to Lawrence Yun, chief economist and senior vice president of the National Association of Realtors. Yun was the keynote speaker this morning at the Greater Baton Rouge Association of Realtors’ annual Trends in Real Estate seminar, which is taking place at L’Auberge Casino & Hotel.
“We have more renters and fewer homeowners at a time when home values are starting to rise,” Yun said. “We are in a situation where just when housing wealth and equity is rising we have fewer homeowners participating in this. … You hear people talk about how America has become more unequal. Well, here it is.”
Though Yun’s assessment of the American economy was relatively sober, he noted that the local market is not in sync with national trends. Unlike other U.S. cities, Baton Rouge has 60,000 more jobs today than it had in 2000.
“That’s a very high level,” Yun said. “The recession here was very shallow and the Baton Rouge economy has done much better than most other cities in the country.”
Yun predicts the U.S. economy will continue to improve over the next five years and that pent-up demand for new housing will fuel several years of growth in both the commercial and residential real estate sectors. While that’s good news, local real estate experts are already predicting several years of prosperity in the local market.
“Our market is not just healthy,” said Scot Guidry of Mike Falgoust & Associates Commercial Real Estate. “It’s strong and we continue to expect it to grow.”
Read Daily Report PM today for a complete recap on today’s Trends in Real Estate seminar.
—Stephanie Riegel
