U.S., Florida & Orange County Economic Update 2015 Economic Summit Orlando, FL December 15 th, 2015

Economic Policy Uncertainty  Health Care Reform  Employer mandates  Impact on labor market  Dodd-Frank Financial Regulatory Reform  Impact on credit flows & financial sector  37.1% (104 – 94 without proposals)  Fiscal Policy  Monetary Policy  When will interest rate hikes commence?  Labor market/wage growth  How will financial markets react?

U.S. Forecast

 Payroll jobs to reach potential

U.S. Forecast  Missing Workers

U.S. Forecast

Unemployment if “missing workers” were found

U.S. Economic Outlook 2014 Q Q Q GDP % Change, Annual Rate Consumer Price Index % Change, Annual Rate Consumer Sentiment Consumption % Change, Annual Rate

U.S. Forecast  The Arithmetic of Higher Oil Prices:  Each $1 decrease in the price of a barrel of oil will:  Decrease price of gallon of gas 2.5 cents  Push consumer gasoline bills down $3 billion  Lower the CPI 0.03%  Raise real disposable income 0.25%

U.S. Forecast  The Economics of lower Oil Prices:  Each permanent $10 decrease in the price of a barrel of oil will:  Raise forecast real GDP growth 0.2% in 1 st year, 0.5% in the 2 nd  Raise forecast of payroll employment 110,000 in 1 st year and 390,000 in 2nd  Psychic Impact  Domestic production impacts?

U.S. Forecast

Florida Housing Market  Housing market recovery continues  Now single-digit price appreciation  Still high level of investor activity  Housing finance still an issue

Florida Housing Market

November 2014 November 2013 Percent change Closed Sales17,77216, % Median Sale Price $176,000$170,0003.5% Median Days on Market % Inventory ( Months Supply ) % Florida Housing Market

 Investors are still active in Florida residential real estate  Still high share of cash transactions  Private equity, hedge funds international buyers

Median Monthly Rent Median Home Price Annual yield January2012$1,233$129, % January-2013$1,289$145, % January-2014$1,395$163, % November $1,420$176,0008.1% Housing Market Cash Sales  Why are investors still active in Florida residential real estate?

November 2014 November 2013 Cash as % of November 2014 Sales Florida6,9617, % Miami1,2921, % Tampa1,2241, % Jacksonville % Orlando % Housing Market Cash Sales

Florida Forecast

Averages; Q Forecast Florida Sector % Average Annual Growth Construction9.2 Professional & Business Services3.5 Trade, Transportation & Utilities3.3 Leisure & Hospitality2.0 Education-Health Services1.9 Information1.2 Financial0.9 Manufacturing0.6 State & Local Government0.5 Federal Government-0.6

Region Population Growth Average % ChgRank Florida Deltona 1.27 Gainesville Jacksonville 1.44 Lakeland 1.09 Miami 1.25 Naples 2.41 Ocala 1.63 Orlando 2.12 Palm Bay 1.18 Pensacola Tallahassee Tampa Averages; Q Forecast

Region Employment Growth Average % ChgRank Florida Deltona 1.77 Gainesville Jacksonville 2.33 Lakeland 1.59 Miami 2.14 Naples 2.91 Ocala 1.58 Orlando 2.72 Palm Bay 1.76 Pensacola Tallahassee Tampa Averages; Q Forecast

Orlando MSA Sector % Average Annual Growth Construction8.6 Professional & Business Services4.1 Leisure & Hospitality2.9 Trade, Transportation & Utilities2.4 Education-Health Services2.2 Information1.8 Manufacturing1.2 State & Local Government1.1 Financial0.4 Federal Government-0.4

Orange County Forecast

Sean M. Snaith Sean M. Snaith, Ph.D.Director Institute for Economic Competitiveness (407) Thank you