CITY OF NAPA: DASHBOARD
CITY COUNCIL PRESENTATION
NAPA, CA MARCH 2023
Robert Eyler, PhD
President, Economic Forensics and Analytics Inc.
Professor, Economics, Sonoma State University
[email protected]
1 ATTACHMENT 1
How the FED fares: Inflation on the Mend?
2 What’s Next?
• Confusing inflation
signals means rates
more likely to stay put
• Housing markets to
give back gains (think
10-15% in 2023)
• Job losses slowly
coming, expect more
Real GDP (%) Unemployment Rate (%) Core PCE Inflation (%) Annual data (projections based on annual-average levels):
Previous New Previous New Previous New
2023 0.7 1.3 4.2 3.8 3.0 3.0
2024 1.8 1.4 4.3 4.2 2.4 2.3
2025 2.2 2.2 4.2 4.2 N/A 2.1
2026 N/A 1.5 N/A 4.1 N/A N/A
Federal Reserve Philadelphia
Forecast, Survey of Professional Forecasters
Source: Federal Reserve Philadelphia Branch
These data are from February 2023
For US Economy
Napa at a Glance: end of Q4 2022
4
Employment Trends: City Residents Working or Looking for Work, 2019-2022
5
T axable Sales % Change, Q3 2022 from Q3 2021
City of Napa, Napa County (outside City of Napa), California 6 Source: California Department of Tax and Fee Administration (CDTFA)
3.8%
7.0%
7.7%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
City of Napa California Napa County Less City of Napa
Some tradeoffs here:
1. Taxable sales are up
but some of this
driven by inflation
2. Slower pace of
growth after 2020
and 2021 spending
3. Expansion of
restaurants and other
retail outside city in
Napa County likely to
continue (American
Canyon)
T ourism, Average Daily Rate ($) and
Occupancy Rate (%), April 2019 to Dec 2022
7
Housing: % Change Median Home Price Jan 2021 to Jan 2023 Median Rents, Jan 2019 to Jan 2023,
City of Napa and Selected Cities and Counties
8 Source: ZillowTM Research
2.4%
13.9%
25.8%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
One Year Two Year
Equity Measures: Housing Burden
City of Napa and Selected Cities and Counties
9 Housing Burden
% of Households with Rent as at
least 30% of monthly income
Place 2010 2015 2020 2021
Napa City 55.3% 55.3% 55.6% 56.0%
Napa County 53.1% 55.5% 52.6% 54.2%
Sonoma 55.8% 56.9% 54.7% 54.7%
Marin 54.2% 54.1% 50.5% 51.6%
Solano 56.2% 57.0% 53.4% 54.2%
Yamhill 49.6% 54.1% 50.7% 54.4%
Fairfield 57.4% 55.5% 54.8% 57.5%
Livermore 50.7% 49.7% 50.3% 52.2%
Petaluma 56.0% 50.5% 54.7% 58.2%
San Rafael 56.3% 58.4% 54.2% 54.0%
Santa Cruz 63.2% 67.5% 58.9% 56.3%
Temecula 54.4% 57.8% 53.9% 56.5%
Monterey 49.5% 52.9% 55.4% 54.4%
CA 55.1% 56.9% 54.2% 54.2%
US 50.8% 51.8% 49.1% 49.4%
Housing Burden: % of after-tax income paid for rent
or ownership (these data are just rentals)
• A percent over 30% is considered “burdened” in
housing advocacy circles
• Severe burden is considered over 50%
• Caveats
• Burden is a function of housing costs and
incomes
• The key is how households are making
budget decisions assuming taxes and
housing are paid first
• Napa is 5th highest of this group as of
2021 (the latest Census data)
City of Napa: Things to Watch
• Toward 2024
• Macroeconomic context remains uncertain
• Do interest rates rising matter as much to Napa housing market? • Inflation to persist to 2024 minimum
• Travel industry: is a slower economy ok for Napa tourism? • High airline prices and geopolitical concerns = stability or growth in 2023? • Cost pressures going to affect smaller, local business • Housing mixed signals
• Housing burden could be falling because of rising household incomes • Rents still rising: pressure on housing and workforce development/retention • This is the local public policy issue for the 2020s
10
Thanks!
Questions?
[email protected]
@bobby7007
11