A national economist painted a fairly optimistic picture of Whatcom County’s economy and real estate market at an annual presentation held at the Mount Baker Theatre.
Ted Jones, chief economist for Stewart Title, gave his 2007 economic forecast to more than 200 attendees on Thursday. Jones touched on a variety of economic issues, but liked what he saw in several local economic numbers, including low unemployment and strong job growth, which has been much better than the national average.
Retail spending in the Bellingham and Whatcom County area has been pretty good as well. With a workforce that’s fully employed there’s more spending and our Canadian neighbors are also spending more the Whatcom County area with a favorable exchange rate.
“There are a lot of good things that are happening not only in Whatcom County, but in this region. I am especially big on what is happening with Boeing, which will really be growing with its new 787,” Jones said, adding that the growth he expects from Boeing will have residual impacts in Whatcom County.
Jones said that while there are some real estate bubbles in different parts of the country, especially Florida, this area shouldn’t see a dramatic drop in home sales or prices.
“While home sales in Whatcom County went down (21.3 percent in the fourth quarter of 2006 compared to the fourth quarter of 2005), building permits also went down significantly,” Jones said. “This area cut back on building, probably because lenders got scared to death. They kept on building in Florida, and now they are experiencing some major problems.”
While Jones was generally upbeat, he did have a list of concerns that might slow down the national economy, which would then affect this region:
Time-bomb loans. This was Jones’ reference to the growth of exotic loans that usually involve paying little interest early on, but significantly more when the term is up. He believes this type of lending will lead to a sharp rise in foreclosures.
Extreme partisan politics. Jones expects bickering among politicians to increase, which could impact consumer confidence. “The numbers are good right now, but we could easily talk ourselves into a recession,”
In the question-and-answer session at the end of the presentation, Jones talked about concern from a listener that the Bellingham area is becoming more of a retirement community and how that might hurt the economy. Jones debated that opinion, saying that people may be moving to Bellingham to retire, but they will actually continue to work and spend money.
“I believe this about the baby-boomer generation because they are continuing to spend like their children,” Jones said. “Many retirees haven’t even paid off their home yet, a trend that is different from previous generations.”