Florida’s economy will grow faster than the national economy over the next three years, fueled in part by an increasing population that will propel construction jobs to experience the highest growth of any employment sector, according to the latest forecast from UCF economist Sean Snaith.
“The fundamental underpinnings of the housing market in Florida continue to improve,” Snaith wrote in the Florida & Metro Forecast, 2016-2019, citing strong job growth and increasing population trends in Florida.
Florida’s economy, as measured by Real Gross State Product, will expand at an average 2.9 percent a year through 2019, outpacing projections for the national economy.
Housing starts, which flattened in 2014, will increase to nearly 151,000 in 2019, a substantial jump over the 117,000 forecast for this year.
Florida’s housing market continues to improve, but shrinking inventory and a backlog of housing starts are pushing single-family home prices up. The February 2016 year-over-year median sale price appreciation is 11.1 percent, and cash transactions represent a high 36.6 percent of closed sales that same month.
“Florida is behind the curve on new home construction and shrinking inventories of existing single family homes for sale is fueling double-digit price appreciation,” said Snaith.
The median sales price for single-family homes increased $20,001 in February, year over year, and now stands at $200,000.
Despite price appreciation, 17.1 percent of Florida mortgage-holders are still underwater on their home loans.
Over the next three years, the sectors with the strongest job growth are: construction, 4.9 percent; professional and business services, 3.3 percent; trade, transportation and utilities, 2.4 percent; leisure and hospitality, 2.2 percent; and education and health services, 2 percent.
A strong recovery in labor markets and rising home values will boost retail sales growth and average pace of more than 4.8 percent from 2016-1019.
Snaith is a national expert in economics, forecasting, market sizing and economic analysis who authors quarterly reports about the state of the economy. Bloomberg News has named Snaith as one of the country’s most accurate forecasters for his predictions about the Federal Reserve’s benchmark interest rate, the Federal Funds rate.
Snaith also is a member of multiple national forecasting panels, including The Wall Street Journal Economic Forecasting Survey, CNNMoney.com’s survey of leading economists, the Associated Press Economy Survey, the National Association of Business Economics Quarterly Outlook Survey Panel, the Federal Reserve Bank of Philadelphia’s Survey of Professional Forecasters, the Livingston Survey, Bloomberg U.S. Economic Indicator Survey, Reuters U.S. Economy Survey, and USA Today Economic Survey Panel.
The Institute for Economic Competitiveness strives to provide complete, accurate and timely national, state and regional forecasts and economic analyses. Through these analyses, the institute provides valuable resources to the public and private sectors for informed decision-making.