By Jim West, Broker
There were three articles in the Columbian over the past few weeks that hold good news for Clark County economic trends as we head into the 4th quarter of the year.
First Scott Bailey our regional labor economist with Washington Employment Security released an employment report that showed Clark County’s economy expanded by 5,800 jobs in the 12 months ending in August, posting a growth rate of 4.2 percent and recording a preliminary unemployment rate of 7 percent which has steadily improved over the past five years. That’s down from 9.9 percent unemployment in August 2013.
Driving more than 60 percent of the year-over-year employment gains were “the big three,” as Bailey defines it, transportation and utilities (up 1,500 jobs), professional and business services (plus 1,200 jobs) and construction (up 1,000 positions). From conversations with members of both the SWCA and the BIA the pace of construction has definitely accelerated in 2014.
This annualized growth rate of 4.2 percent more than doubled that of the nation’s (1.8 percent), easily topped those of Washington and Oregon (2.5 percent and 2.4 percent, respectively) and surpassed that of the Portland metro area (3 percent).
There is another sign show the county’s labor market is strengthening: “Initial unemployment claims and continued unemployment claims continue to be at low levels,” according to Bailey.
Second the Department of Commerce released a report highlighting the U.S. economy’s bounce-back last quarter from a dismal winter was even faster than previously thought, a sign that growth will likely remain solid for rest of the year. It was the fastest pace in more than two years and higher than the government’s previous estimate of 4.2 percent.
The upward revision reflected stronger-than-expected business investment and exports last quarter. This surge in the second-quarter growth marked a sharp rebound from the January-March quarter, when the economy shrank at a 2.1 percent rate in the midst of a brutal winter that idled factories and kept consumers at home.
The final upward revision was driven by new-found strength in business investment, which grew at an annual rate of 9.7 percent last quarter thanks to higher spending on structures and equipment.
There was good news in several other sectors as well. Exports also helped boost the economy. The data showed that exports grew at an 11.1 percent rate. Consumer spending, which accounts for more than two-thirds of economic activity, grew at a 2.5 percent annual rate. That figure was unchanged from the previous estimate. But it represents twice the 1.2 percent growth in consumer spending in the first quarter.
Because of the rough start to the year, growth for 2014 overall is expected to be a temperate 2.1 percent, little changed from last year’s 2.2 percent increase.
Finally there was news about the Clark County’s real estate market in August which reflected a continued strength overall with year-over-year increases in pending sales and median sales price and a 10 percent drop in the time needed to sell a home.
The median sales price of a home sold in Clark County in August was $250,000, up 9.2 percent from last August. That median — half sell for more, half for less — is just 3.9 percent lower than in August 2007.
All year-over-year indicators provided evidence of the market’s continued strength. There were 661 closed residential sales in August, a 5.6 percent increase from a year ago, according to Portland-based RLMS, a real estate listing service. Pending sales also were up by 9.4 percent, with 699 for the month. That category was at its highest level for August since 2006, according to Mike Lamb, a broker at Windermere Stellar in Vancouver.
Realtors say the Clark County housing market is constrained by a shortage of homes available for sale, and the monthly numbers reflect their view of a strong seller’s market. In his report, Lamb said the market is poised for a strong fall sales season. “Still, the challenge continues to be inventory,” particularly in homes priced below $300,000″ he wrote.
The market is on track to have its best year since at least 2007 should this trend continue.