ECONOMIC

INDICATORS©

FAIRFAX COUNTY

DEPARTMENT OF MANAGEMENT AND BUDGET OCTOBER 2018

IN THIS ISSUE: The August unemployment rate in Fairfax

County increased to 2.5 percent. (See page 1) For the first three months of the fiscal year,

Sales tax receipts in Fairfax County are up 2.7 percent.

(See page 2)

The Consumer Confidence Index increased in September for the third straight month.

(See page 2) The number of homes sold in Fairfax County

during September 2018 decreased 13.6 percent from a year earlier.

(See page 3) In September 2018, the average sales price

of all homes sold in Fairfax County increased 5.8 percent compared to the average sale price in September 2017.

(See page 3) The number of active listings of homes for

sale in the County decreased 8.3 percent in September from a year ago.

(See page 4) The number of single family building permits

issued in the County for the first nine months of 2018 is up 4.8 percent.

(See page 4) October 2018 Special Report on Northern

Virginia Employment. (See page 5-6)

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

13,000

14,000

15,000

16,000

17,000

18,000

19,000

20,000

21,000

FAIRFAX COUNTY UNEMPLOYMENT DATA

Number ofUnemployed

Unemployment Rate

Unemployment Rate

Number ofUnemployed

Unemployment Rate

Source: Virginia Employment Commission. Compiled by the Fairfax County Department of Management and Budget.

Employment

Compared to July, the August unemployment rate in Fairfax County increased 0.1 percentage point to 2.5 percent. The number of unemployed residents increased over the month from 15,326 to 16,026. The County’s unemployment rate was down 0.7 percentage point from August 2017.

In August, the seasonally adjusted unemployment rate in Virginia decreased 0.1 percentage point to 3.0 percent. The rate was down 0.7 percentage point from August 2017. This is the lowest monthly unemployment rate since August 2007.

The U.S. seasonally adjusted unemployment rate was 3.9 percent in August, unchanged compared to July. The rate was down 0.5 percentage point from a year ago. Total nonfarm payroll employment increased by 201,000 in August. Over the last three months, job gains have averaged 185,000 per month.

Previous issues of this publication can be accessed at:

https://www.fairfaxcounty.gov/budget

/economic-indicators

Page 2

Sales Tax Receipts

$8

$10

$12

$14

$16

$18

AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL

MillionsFAIRFAX COUNTY SALES TAX RECEIPTS(revenues represent retail sales two months prior)

FY 2017

FY 2018

FY 2019

Source: Virginia Department of Taxation. Compiled by the Fairfax County Department of Management and Budget.

Sales Tax receipts distributed to Fairfax County in October for retail purchases made in August were $15.6 mil l ion, an increase of 4.3 percent over October 2017. During the first three months of FY 2019, Sales Tax receipts are up 2.7 percent over FY 2018.

NATIONAL INDICATORS

Case-Shiller Home Price Indices

Based on the latest available data, home prices in 20 U.S cit ies, as measured by the S&P Case-Shil ler home price index, increased 5.5 percent for the 12 months ending in August. Home prices in the Washington Metropolitan area posted a 2.8 percent gain during the same period, t ied with New York for the lowest rate of increase among the metropolitan areas in the index. David M. Blitzer, Managing Director and Chairman of the Index Committee, said that, “Following reports that home sales are flat to down, price gains are beginning to moderate. ” He added that, “Rising prices may be pricing some potential home buyers out of the market, espec ially when combined with mortgage rates approaching 5% for 30-year f ixed rate loans.”

Consumer Confidence Index

100

105

110

115

120

125

130

135

140

145

150

SEP

17

OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP

18

1985=100, N

ot S

easonally A

dju

ste

d

U.S. CONSUMER CONFIDENCE INDEX

Source: The Conference Board. Compiled by the Fairfax County Department of Management and Budget.

The Consumer Confidence Index increased in September for the third straight month and now stands at 138.4 (1985=100), up from 134.7 a month ago. Both the present situation and the expectations component increased. Lynn Franco, Director of Economic Indicators at the Conference Board, said that, “Consumers’ assessment of current conditions remains extremely favorable, bolstered by a strong economy and robust job growth.” She added that, “These historically high confidence levels should continue to support healthy consumer spending, and should be welcome news for retailers as they begin gearing up for the holiday season. ”

Consumer Price Index

The September Consumer Price Index for All Urban Consumers (CPI-U) increased 2.3 percent compared to last September. Excluding food and energy, core inflation increased 2.2 percent. Through September, the Washington area CPI-U increased 2.0 percent compared to a year ago. The Federal Reserve Board’s target annual inflation rate is 2 .0 percent.

Page 3

FAIRFAX COUNTY HOUSING MARKET

Total Home Sales Volume

In September, 999 homes were sold in Fairfax County, a decrease of 13.6 percent from the 1,156 homes that were sold in September 2017.

500600700800900

100011001200130014001500160017001800190020002100

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

TOTAL UNITS SOLD IN FAIRFAX COUNTY

2016

2017

2018

Source: Real Es ta te Business Intel l igence. Compi led by the Fair fax County Depar tment of Management and Budget.

Average Days on the Market

On average, homes that sold in Fairfax County in September were on the market for 35 days. This is 8 days fewer than the 43 day average in September 2017.

Changes in sell ing prices and the volume of sales are presented as indicators of the County’s real estate market. Average sell ing price changes do not translate directly into assessment adjustments, since the mix of homes sold is not necessari ly reflective of the County’s entire housing stock. To read more about Fairfax County tax assessments, please visit: https://www.fairfaxcounty.gov/taxes/real -estate

32 3236

42 4345

54

60 61 62

42

28 2725

2832

35

0

15

30

45

60

75

90

AVERAGE DAYS ON THE MARKET IN FAIRFAX COUNTY

Source: Real Es tate Business In te l l i gence. Compi led by the Fair fax County Depar tment of Management and Budget.

Average Home Sales Prices

The average sales price of al l homes that sold in September 2018 in Fairfax County was $561,056, an increase of 5.8 percent over the September 2017 average sales price of $530,429. The average September price was down 1.2 percent compared to the annual 2017 average home sales price of $567,829. The average sales price for detached homes that sold in September 2018 was $758,908, an increase of 5.1 percent over the September 2017 average of $721,800. The average sales price of attached homes increased 5.0 percent over the same period.

SEP 2018 SEP 2017%

Change

All Homes $561,056 $530,429 5.8%

Detached Homes $758,908 $721,800 5.1%

Attached Homes $386,678 $368,406 5.0%

FAIRFAX COUNTY

AVERAGE SALES PRICE OF HOMES SOLD IN

SEP 2018 COMPARED TO SALES IN SEP 2017

Page 4

$400

$425

$450

$475

$500

$525

$550

$575

$600

$625

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Thousands AVERAGE HOME SALES PRICE IN FAIRFAX COUNTY

2016 2017 2018

Source: Real Es ta te Bus iness Intel l i gence. Compi led by the Fair fax County Depar tment of Management and Budget.

Inventory of Homes for Sale

The number of active l istings in the County in September was 3,038, a decrease of 8.3 percent from the 3,313 l istings in September 2017. Based on the September 2018 l istings and the current sales rate, there is approximately a 3.0 month supply of homes for sale in the County, greater than the 2.9 month supply a year ago.

2666 3

006

3215

3332

3253

3106

3313

2902

2245

1642

1515 1653

2062 2

398 2696

2838

2807

2888

3038

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

ACTIVE REAL ESTATE LISTINGS IN FAIRFAX COUNTY

Source: Real Es ta te Bus iness Intel l i gence . Compi led by the Fair fax County Depar tment of Management and Budget.

Single Family Building Permits

During the third quarter of 2018, 249 new single family permits were issued in Fairfax County. This represents a 25.9 percent decrease from the number of permits issued during the same period in 2017. Combined, the number of new single family permits is up 4.8 percent for the first three quarters of 2018.

0

50

100

150

200

250

300

350

400

QTR 1 QTR 2 QTR 3 QTR 4

FAIRFAX COUNTY NEW SINGLE FAMILY RESIDENTIAL PERMITS

2016

2017

2018

Source: Fai r fax County Land Development Serv ices . Compi led by the Fa ir fax County Depar tment o f Management and Budget .

The Department of Management and Budget 12000 Government Center Parkway

Suite 561 Fairfax, Virginia 22035-0074

(703) 324-2391 or TTY 711 (Virginia Relay Center)

Staff: Albena Assenova, Revenue and Economic Analysis Coordinator; Eric Eisinger, Budget Analyst

Page 5

Special Report – October 2018

Northern Virginia Employment

Based on data from the U.S. Bureau of Labor Statistics

(BLS), the Northern Virginia region experienced job growth at an annual rate of 0.9

percent in July 2018. Prior to the recession, annual job

growth from 2003 through 2007 rose at a rate of 2.9 percent. Growth stagnated in

2008, rising just 0.2 percent. The area lost 22,900 jobs in

2009, a drop of 1.7 percent. Employment growth resumed in 2010 and averaged 1.6

percent per year from 2010 through 2012. Federal

sequestration and reductions in procurement spending led

to job losses in late 2013 and 2014, primarily in the Professional and Business Services sector, and limited average overall job growth to an annual rate of 0.4 percent over those two years. Job growth averaged 2.2 percent

in 2015 and 2.1 percent in 2016 before slipping to 1.6 percent in 2017. As of July 2018, total nonfarm employment in Northern Virginia was 1,478,800, a gain of 13,700 jobs since July 2017.

Jobs by Sector in Northern Virginia Employment in the Professional and Business Services sector was 416,200 in July 2018, 28 percent of the total jobs in Northern Virginia.

Education and Health

Svcs , 167.0, 11%

Wholesale Trade, 34.3, 2%

Manufacturing, 26.5, 2%

Information, 39.0, 3%

Financial Activi ties, 80.2, 5%

Other Services, 82.8, 6%

Mining, Logging, Construction, 81.1, 5%

Leisure and Hospitality, 156.2, 11%

Retail Trade, 141.2, 10%

State & Local Govt, 126.3, 9%

Transp. & Uti lity, 42.6,

3%

Federal Govt, 85.4, 6%

Prof. & Bus iness Svcs, 416.2, 28%

Note: Total employment in July 2018 was 1,478,800. Employment figures in the graph above are in thousands.

thousands

-35.0

-20.0

-5.0

10.0

25.0

40.0

55.0

70.0

Jul-0

6

Jan

-07

Jul-0

7

Jan

-08

Jul-0

8

Jan

-09

Jul-0

9

Jan

-10

Jul-1

0

Jan

-11

Jul-1

1

Jan

-12

Jul-1

2

Jan

-13

Jul-1

3

Jan

-14

Jul-1

4

Jan

-15

Jul-1

5

Jan

-16

Jul-1

6

Jan

-17

Jul-1

7

Jan

-18

Jul-1

8

Northern Virginia Job ChangeOver the Same Month the Previous Year

July 2018 job growth=13.7K

Source: U.S. Bureau of Labor

Page 6

The Professional and Business Services sector includes such jobs as attorneys, federal

contractors, and businesses that provide services to other businesses such as printing and computer services. The Education and Health Services and Leisure and Hospitality sectors each

make up approximately 11 percent of total employment in Northern Virginia, while the Retail Trade sector makes up approximately 10 percent. Federal government jobs represent 6 percent of total employment in the area.

Change by Sector Of the 13,700 net new jobs created over the year ending July 2018, 9,200 jobs were in the

Professional and Business Services sector, which increased by 2.3 percent over July 2017. There were also significant increases in the number of jobs in the Mining, Logging, and Construction

sector, which increased by 6,000 jobs or 8.0 percent. The number of State and Local Government jobs decreased by 12,800 jobs or 9.2 percent; however, BLS reported that the July 2018 preliminary estimate in this category was revised down for the final estimate because there

was a sample methodology change, making the year-over-year comparison likely unreliable.

3,500

1,000

0

-100

2,700

2,700

6,000

1,700

-1,900

-12,800

1,700

0

9,200

-20000 -10000 0 10000 20000

Education and Health Svcs

Wholesale Trade

Manufacturing

Information

Financial Activities

Other Services

Mining, Logging, Construction

Leisure and Hospitality

Retail Trade

State & Local Govt*

Transp. & Utility

Federal Govt

Prof. & Business Svcs

Source: U.S. Bureau of Labor Statistics (BLS)* BLS reported a methodology change

Employment in Fairfax County Fairfax County specific employment data by sector are reported on a delayed basis and are

currently available through the first quarter of 2018. In March, total non-farm employment in the County was 603,900, an increase of over 8,770 jobs or 1.5 percent compared to the

previous March. The sector with the largest employment gains was Professional and Business Services, which increased by 6,485 employees or 3.1 percent. From 2014 through 2017, annual job growth in Fairfax County has averaged 1.3 percent.

Northern Virginia Employment Change by Sector

July 2017 to July 2018

Net Total Employment Change = 25,800