CROWLEY – Inflation appears to be leveling off, home sales are holding steady and, overall, this region’s economy is pretty good.
That, in general, is the message delivered during Thursday’s Quarterly Luncheon by Gary Wagner, Ph.D., Acadiana Business Economist, Eminent Scholar Endowed Chair in Economics B.I. Moody College of Business Administration, University of Louisiana Lafayette. Wagner has become a mainstay for the Acadia Parish Chamber of Commerce’s Economic Outlook Luncheon.
Coming off a strong third quarter of 2023, Wagner said he thinks this
region will experience a little bit of a slow down, but he still expects to see about a 1.3% growth in the Acadiana area and a 1.6% growth statewide during the coming year.
“There’s some good news about inflation,” Wagner said. “After reaching a 40-year high mark of 9% in 2022, the Federal Reserve started raising interest rates and we’re now
back down around 3.2%.
“I don’t think we’ll get back down to 2% until 2025.” Wagner said the sudden rise in
the inflation rate was due mainly to the COVID stimulus checks and the rampant spending in the wake of those dispersals.
“The bad thing is that there are no adults in Congress,” he said. “To say they’re spending money like a drunken sailor is an insult to drunken sailors.” Wagner said he thinks the interest rate bumps by The Fed may be over for a while.
“I don’t think they’re going to raise the rates again in December,” he said, adding, “But I doubt
they will cut rates next year.”
Since mortgage rates are reflective of The Fed’s interest rate, Wagner said he doesn’t think mortgage rates will be coming down any time soon.
On the topic of housing, Wagner pointed out that residential sales in Acadiana are down about 13% from 2022. “In Acadia, however, home sales have not fallen much,” he added. “Median sales prices are holding firm at about $182,000.”
He said Acadia Parish residents should expect an increase of about 65% in their flood insurance premiums, from an average of $885 to $1,454. All of these factors account for an out-migration of “mostly young people” from the area, mostly to the Dallas and Houston areas, “but, surprisingly, a lot to Little Rock, Arkansas,” he said.
“We have to find ways of making houses more affordable to get people back here and keep them here,” Wagner said. “How do we do that? We need ‘density.’ We need apartment buildings.” Wagner pointed out that 75% of Lafayette Parish is zoned single-family dwelling. “No one wants an apartment building near them, but we either agree to more density or continue to see
our young people leave,” he said.
