According to a recent report by the U.S. Conference of Mayors, nearly every U.S. metro area is expected to see major economic growth in 2014.
The USCM predicted that the national GDP will reach 2.7 percent in 2014 and 3.2 percent in 2015, a significant improvement from 1.9 percent in 2013.
Most importantly, unemployment is anticipated to drop to 6.5 percent in 2014, reaching the Federal Reserve's goal to start reducing stimulus spending, according to the report. In 2015, unemployment is expected to dip below 6 percent.
"These numbers are welcome news and prove that our cities and metro areas are finally turning the corner and moving toward steady economic recovery," said Scott Smith Mayor of Mesa, Ariz., and USCM president. "Mayors have always known that as cities and their metro areas go, so goes the nation.
The bipartisan budget agreement is an example that Congress can, in fact, work together for the good of hard-working Americans, and we need this spirit of cooperation to continue for the nation's metro areas to thrive.
Housing market growth The economic projections will play an important role in the growth of the housing market in 2014, as the Fed's fiscal policy has helped keep mortgage rates low since 2012. Cities that were hit hard by the recession can expect to see improvement in job growth and home prices. Larger metro areas such as Chicago, New York City and Los Angeles are expected to continue growing, but at a slower pace compared to smaller cities. Overall, more jobs will be a good sign for the recovery in 2014.
"It looks as if the job market will expand which suggests another pick up in home sales in 2014," David Berson, chief economic with Nationwide, told HousingWire. "Will it be as big...probably not. We saw almost a 9% gain in 2013, but for 2014 we expect it to be closer to 5% or 6%. If you look at November and December together, they were the weakest months of the year, which was partly due to weather, mortgage rates and continuous home price gains."
While 2013 was strong year for the housing recovery, 2014 will likely be more stable, as rising mortgage rates and increased prices will appreciated a slower rate. First-time home buyers, who have frequently been outbid by residential investors in 2013, will be able to find more opportunity in the new year.
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