Vermont’s economic performance coming out of the recession is among the best, if not the best, in New England, Fed economist Robert Clifford explained at a Lake Champlain Region Chamber of Commerce breakfast yesterday. Clifford identified the state’s steady job growth and much “healthier” housing market as key drivers of this success.
Employment in Vermont will return to pre-recession levels by the end of 2014, Clifford predicted, well ahead of its New England counterparts and the nation as a whole.
Vermont's foreclosure rate is continually the lowest in New England, he noted, thanks to strict mortgage lending laws passed here in the 1990s and to the state's relatively low unemployment rate. And with housing prices that fell only modestly and are already on the upswing, Vermont is likely to be the first New England state to see prices return to near pre-recession levels.
This also means that, unlike other parts of New England, home buying in Vermont's metropolitan area did not become any more affordable in the past few years, according to some standard measures. As shown below in a graph presented at the breakfast, home buying in the Burlington-South Burlington area was the least affordable in 2011, when compared to other New England metro areas.
Unfortunately, a number of potential challenges could hamper the recovery for Vermont and the nation, Clifford pointed out. Tight credit conditions, federal budget sequestration and other policies that reduce funding coming into Vermont, and a global economic slowdown all pose substantial risks.
The breakfast was sponsored by NBT Bank.
