Region’s economy poised for strong finish to year

From The Frederick News-Post:

The Washington, D.C. region’s economy should be strong through at least the end of the year, while homes in Washington’s Maryland suburbs, including Frederick County, continue to sell even as fewer of them are available, according to data released this week.

The Washington region’s economy registered its strongest growth of the year so far in June, and the growth is likely to continue through at least the fourth quarter of 2018, according to a study from the Stephen S. Fuller Institute, based at George Mason University in Virginia.

The institute’s index that measures the current state of the region’s economy increased in June, the fourth time in the first six months of the year, while consumer confidence increased after declining each of the three previous months.

Meanwhile, the index designed to predict the region’s economic performance six to eight months ahead of time increased by 0.78 percent in June, after more sluggish gains in the two previous months.

The indicators of sales of durable goods, expected consumer confidence, and residential building permits all increased, indicating confidence that the economy will be strong in the near future.

Meanwhile, initial claims for unemployment insurance increased 19.5 percent in June, after having dropped in each of the first five months of the year.

The June numbers represent a bit of a pivot in the economic forecast, said Jeannette Chapman, deputy director and senior research associate at the Fuller Institute.

The April and May numbers, while still showing growth, were a little more moderate, she said.

With the June numbers, it now seems likely that the region will see growth through the end of the year, and by some reports into 2019, she said.

But the unpredictability of the congressional midterm elections, expected uncertainty over the federal budget in October, and the impacts of national policies on trade and procurement — such as President Donald Trump’s tariff policies against various countries — could have an impact on that expected growth, Chapman said.

The tariff issue could adversely affect Maryland’s overall economy by taking a toll on the volume of goods coming and going from the Port of Baltimore, said Daraius Irani, chief economist at the Regional Economic Studies Institute at Towson University.

A potential government shutdown, rising gasoline prices, and likely rising interest rates are among the other potential economic challenges, he said.

But he’s still predicting positive growth through the end of the year, although it may not be as strong as some might hope.

Having a Republican presidential administration that is focused on the military will likely benefit the numerous military installations around Maryland, as will the recently increased emphasis on cybersecurity, Irani said.

The economic data for the third quarter of 2018, which ends at the end of September, should give an idea that any impact the tariffs will have, he said.

Meanwhile, the housing situation in Washington’s Maryland suburbs remains strong for sellers, with the number of homes on the market down from a year ago.

Inventory in Frederick County is 13 percent lower than at this time last year, said Doug Gardiner, managing partner of The Maryland Group at Long & Foster, based in Frederick.

The inventory was down 5 percent in Charles County, and 14 percent in both Montgomery and Prince George’s counties, according to a Long & Foster release.

“We’re now having more eyes on less,” Gardiner said.

The shortage of homes can be harder for people looking to buy, but it also means very short turnaround times on properties, he said.

While the 432 homes sold in the county in August were 5 percent higher than the number sold a year ago, the median sale price was down 4 percent in the same time, according to the release.

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