By Staff Reports
(Victorville)– Rising home prices, falling unemployment, soaring consumer confidence and increasing household wealth bode well for both the national and regional economies, according to senior economist Sarah House, who spoke during the Oct. 25 High Desert Opportunity event in Victorville.
“As we look at the past couple of quarters as a whole, we’re expecting year-over-year growth for the economy to increase to about 3 percent,” said House, director and senior economist with Wells Fargo Securities. “So that would be one of the strongest paces of this entire expansion … So right now, the environment is pretty good.” She noted that job growth is still exceptionally strong and that during the current economic expansion, consumer spending has not been fueled by credit. She expects the Federal Reserve to enact three interest rate hikes in 2019, but that the Fed may pull back one rate hike.
Nevertheless, higher interest rates will put further pressure on home sales. Higher home prices are due, in part, she said, to the lack of new construction. A shortage of construction workers, she said, has forced some residential and commercial developers to scrap construction plans. By 2020, House said she expects to see slower economic growth and an uptick in inflation.