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June 6, 2012
William R. EmmonsFederal Reserve Bank of St. Louis
These comments do not necessarily represent the views of the Federal Reserve Bank of St. Louis or
the Federal Reserve System.
The Economic and Housing Outlook for St.
Charles
1
St. Charles County Association of
Realtors
The Economic and Housing Outlook For St. Charles County
Despite weak national and regional recoveries, the St. Charles County economy remains one of the strongest in the state. Unemployment rate at 6.3 percent, vs. 8.1 nationally
(April). Employment growth has resumed.
The St. Charles housing market faces significant challenges to recover its pre-recession vigor. Homebuilding, house prices, home sales still weak. Mortgage performance good, not great. The key questions:
Will employment and income growth pick up again? How will the aging population affect the market?
2
U6 Unemployment Measure: Unemployed+Marginally Attached+Part TimePercent of labor force plus marginally attached
U3 Offical Unemployment RatePercent of labor force
15100500Sources: Bureau of Labor Statistics /Haver Analytics
18
16
14
12
10
8
6
4
2
18
16
14
12
10
8
6
4
2
U.S. Unemployment Remains Stubbornly High—Especially Broader Measures
3
Percent
Source: Bureau of Labor Statistics Monthly data through May 2012
Broad measure: 14.8%
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
Official measure: 8.2%
4
Weakest Regions Are the Far West, Southeast, and Upper Midwest
Darker shading represents a higher level of unemployment. US unemployment rate in April 2012: 8.1%Highest unemployment rate after 2.75 years of
economic recovery since 1940
Source: GeoFred (http://geofred.stlouisfed.org) Monthly data for April 2012
U.S. Nonfarm Payroll Employment
Millions of employed persons
20151005009590Source: Haver Analytics
150
145
140
135
130
125
120
115
110
105
100
150
145
140
135
130
125
120
115
110
105
100
We’re Making Slow Progress Closing A Huge Employment Gap
5
Millions of employed persons
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
Source: Bureau of Labor Statistics Monthly data through May 2012
Trend implied by 1990s
expansion
Trend implied by 2000s
expansion
2009-12 trend: On track to hit previous
trend line in 2018
6
St. Charles County Unemployment Rate Is Lowest In the Region: 6.3% in April
Source: GeoFred (http://geofred.stlouisfed.org) Monthly data for April 2012
Darker shading represents a higher level of unemployment.
St. Charles County has the lowest unemployment rate within a 50-mile radius—6.3% in April 2012.
Number of Employed Persons in St. Charles County MO
Thousands, seasonally adjusted
15100500Source: Bureau of Labor Statistics /Haver Analytics
190
185
180
175
170
165
160
190
185
180
175
170
165
160
Employment in St. Charles County Exceeds Its Pre-Recession Peak
7
Thousands of employed
persons
Source: Bureau of Labor Statistics Quarterly data through Q1.2012
St. Charles County
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
St. Charles County EmploymentSt. Louis County Employment
St. Louis City EmploymentJefferson County Employment
15100500Sources: BLS /Haver
120
115
110
105
100
95
90
85
80
120
115
110
105
100
95
90
85
80
Rest of the St. Louis Metro Area Remains Below Pre-Recession Peaks
8
Indexes equal 100 in
2000
Source: Bureau of Labor Statistics Quarterly data through Q1.2012
St. Charles County
St. Louis County
St. Louis City
Jefferson County
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
Chicago-Naperville-Joliet IL-IN-WI Private Building Permits Issued (seas'ly adj)St. Louis MO-IL Private Building Permits Issued (seasonally adjusted)
Kansas City MO-KS Private Building Permits Issued (seasonally adjusted)Springfield MO Private Building Permits Issued (seasonally adjusted)
15100500Sources: CEN/H /Haver
15000
10000
5000
2000
1000
500
200
100
15000
10000
5000
2000
1000
500
200
100
Homebuilding Activity Remains Depressed Throughout the Midwest
9
Number of housing
units
Source: Census Bureau Quarterly data through Q1.2012
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
Chicago
St. Louis
Kansas City
Springfield MO
Chicago-Naperville-Joliet IL-IN-WI Private Building Permits Issued (seas'ly adj)St. Louis MO-IL Private Building Permits Issued (seasonally adjusted)
Kansas City MO-KS Private Building Permits Issued (seasonally adjusted)Springfield MO Private Building Permits Issued (seasonally adjusted)
1514131211100908070605Sources: CEN/H /Haver
110100
90807060
50
40
30
20
10
11010090807060
50
40
30
20
10
St. Louis-Area Homebuilding Declined Less Than Elsewhere
10
Indexes: Average
level in 2005 equals 100
Source: Census Bureau Quarterly data through Q1.2012
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
Chicago
St. Louis
Kansas CitySpringfield MO
St Charles County Private Building Permits Issued (= 100 in 2004)Jackson County Private Building Permits Issued (= 100 in 2005)St Louis County Private Building Permits Issued (= 100 in 2004)Greene County Private Building Permits Issued (= 100 in 2005)
151413121110090807060504Sources: CEN/H /Haver
100908070
60
50
40
30
20
10
100908070
60
50
40
30
20
10
St. Charles CO Peak-to-Trough Decline Relatively Mild Thru 2010; Weak 2011
11Source: Census Bureau Quarterly data through Q1.2012
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
Indexes: Average level in 2004 equals
100 in St. Charles and St. Louis Counties; average level
in 2005 equals 100 in Jackson
and Greene Counties
St. Charles County
St. Louis County
Jackson County (Kansas City)
Greene County (Springfield)
St Charles County Private Building Permits Issued (seasonally adjusted)Jackson County Private Building Permits Issued (seasonally adjusted)St Louis County Private Building Permits Issued (seasonally adjusted)Greene County Private Building Permits Issued (seasonally adjusted)
15100500Sources: CEN/H /Haver
5000
4000
3000
2000
1000
500
200
5000
4000
3000
2000
1000
500
200
St. Charles County Remains #1 or #2 Homebuilding County in Missouri
12
Number of housing
units
Source: Census Bureau Quarterly data through Q1.2012
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
St. Charles County
St. Louis County
Jackson County (Kansas City)
Greene County (Springfield)
St. Charles Home Prices Have Tracked Regional and National Trends—Still Weak
13
Dollars
Sources: Zillow; St. Charles County Association of Realtors Annual data through 2011
St. Charles Home Sales Also Tracked National Sales
14
Number of homes
Sources: National Association of Realtors; St. Charles County Association of Realtors Annual data through 2011
15
March 2006: At the Peak of the Housing Boom, Mortgage Conditions Were Pristine
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2006
Source: Lender Processing Services
16
March 2007: Falling House Prices, Slowing Economy Begin to Show
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2007
Source: Lender Processing Services
17
March 2008: Financial Crisis Is Underway, Economy Has Entered Recession
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2008
Source: Lender Processing Services
18
March 2009: At Its Worst, Mortgage Distress Was Concentrated in SW, SE, and MW
Source: Lender Processing Services
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2009
19
March 2010: At Its Worst, Mortgage Distress Was Concentrated in SW, SE, and
MW
Source: Lender Processing Services
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2010
20
March 2011: Mortgage Distress Remains Elevated Despite Economic Stabilization
Source: Lender Processing Services
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2011
21
March 2012: Mortgage Distress Remains Elevated Despite Economic Stabilization
Source: Lender Processing Services
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2012
22
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2005
Source:Lender Processing Services
23
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2006
Source:Lender Processing Services
24
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2007
Source:Lender Processing Services
25
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2008
Source:Lender Processing Services
26
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2009
Source:Lender Processing Services
27
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2010
Source:Lender Processing Services
28
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2011
Source:Lender Processing Services
29
Share of Missouri Mortgages 30+ Days Delinquent or in Foreclosure By ZIP Code
March 2012
Source:Lender Processing Services
30
Judicial Foreclosure States Generally Have Bigger Foreclosure Inventories
Source: Lender Processing Services
Percent of Mortgages 30+ Days Past Due or in Foreclosure, By CountyMarch 2012
JJ
JJ
JJ
JJ JJ
JJ
JJJJ
JJ
JJ
JJ JJ
JJ
JJ
JJ
JJ
JJ
JJ
JJ
JJ
JJ
JJ
JJ
31
Share of Mortgages 30+ Days Delinquent or in
Foreclosure By ZIP Code
April 2012
Source:Lender Processing Services
St. Charles County EmploymentSt. Louis County Employment
St. Louis City EmploymentJefferson County Employment
201510050095908580Sources: BLS /Haver
600
500
400
300
200
150
100
50
600
500
400
300
200
150
100
50
St. Charles County Employment Doubled Between 1985 and 2005
32
Employed persons in thousands
Source: Bureau of Labor Statistics Monthly data through April 2012
St. Charles County
St. Louis County
St. Louis City
Jefferson County
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
St. Charles County Five-Year Annualized Employment Growth RatePercent change from 60 months ago, annualized
St. Louis MSA Minus St. Charles CO Five-Year Annualized Employment Growth RatePercent change from 60 months ago, annualized
20151005009590Source: Haver Analytics
6
5
4
3
2
1
0
-1
-2
6
5
4
3
2
1
0
-1
-2
Is the St. Charles County Job-Creation Miracle Finished?
33
Percent change from five years
ago, annualized
Source: Bureau of Labor Statistics Monthly data through April 2012
St. Charles County
St. Louis metropolitan area excluding St.
Charles County
Gray shading indicates periods of national economic recession as defined by the National Bureau of Economic Research.
St. Charles County Resident PopulationSt. Louis County Resident Population
St. Louis City Resident PopulationJefferson County Resident Population
2015100500959085807570Sources: CEN/H /Haver
11000001000000
900000800000700000600000
500000
400000
300000
200000
100000
11000001000000900000800000700000600000
500000
400000
300000
200000
100000
Population Growth Has Slowed
34
Residents
Sources: Census Bureau Quarterly data through Q1.2012
St. Charles County
St. Louis County
St. Louis City
Jefferson County
Aging of the Population Will Affect St. Charles County, Too
35
Percent
Source: Census Bureau Annual data through 2010; projections through 2030
St. Charles County
St. Louis County
State of Missouri
Data Projections
Has St. Charles Housing Market Reached A Turning Point—Or Another False Recovery?
36
Units
Source: St. Charles County Association of Realtors Monthly data through April 2012
Despite weak national and regional recoveries, the St. Charles County economy remains one of the strongest in the state. Unemployment rate at 6.3 percent, vs. 8.1 nationally
(April). Employment growth has resumed.
The St. Charles housing market faces significant challenges to recover its pre-recession vigor. Homebuilding, house prices, home sales still weak. Mortgage performance good, not great. The key questions:
Will employment and income growth pick up again? How will the aging population affect the market?
37
In Sum: St. Charles County Economy and Housing Market Face Challenges