Housing Complex

Keys to D.C.’s Confidence: Housing Market, Transience

Another way of looking at it. (Clarus)

A few days ago, we took note of the oddity of D.C's high consumer confidence relative to suburban dwellers, as reflected in a survey done by Clarus Research for the Greater Washington Board of Trade. For an explanation, I called up the Center for Regional Analysis' Lisa Sturtevant—heir apparent to this guy—who had some thoughts on the data.

First of all, there might be some problems with the data, Sturtevant says. 800 people is an okay sample size, generally speaking, but if only a few hundred of them came from the District, it's hard to come to any concrete conclusions.

But if we accept the survey tells us, there are a couple things that could explain the difference. One: D.C.'s residential real estate prices are on the way up. "One thing that D.C. has going for it is that the housing market is back, and that makes people feel better, even if they're renters," Sturtevant says. And two: District residents tend to be more transient, and people starting new phases in life tend to be more excited about the future. "If you have just moved, that's associated with optimism generally," she finishes.

The survey did reach cell phones as well as land lines, so it's reasonable to believe that it picked up the younger folks that Sturtevant is talking about. It's also worth noting, though, that the newcomers could be bringing up the average—if they're feeling supremely confident, and are also employed at a higher rate, that could hide greater pessimism among the 10.4 percent of people who still don't have jobs (and want them).

  • http://distcurm.blogspot.com/ IMGoph

    do you have numbers that back up that DC has more newly arrived folks than suburban counties, or are we just taking ms. sturtevant's word for it?

  • trulee pist

    Kind of a stretch--the DC respondents are recent in-migrants full of confidence, and home prices are stable-to-rising? Those two factors affect a tiny fraction of the DC population.

    How many interviews were conducted in DC?

    The DC portion of the sample, with large margin of error, does not stand on its own in terms of a statistically strong representation of the views of District residents. For the total DC Metro area sample, the correct conclusion is declining consumer confidence over the past year. Using these data to assert DC is not participating in the overall decline in consumer confidence is speculation, not data-based.

  • Lydia DePillis

    @IMgoph

    I was just taking Lisa's word for it - she is a statistical expert on the region, after all. Still, if it's not true, that would be good to know. Do you know what stats would be most instructive here?

  • http://distcurm.blogspot.com/ IMGoph

    Lydia: I guess I would want to see if the Census had migration data for the jurisdictions in question (and yes, as an employee, I should know this - I can ask when I'm back at work on Monday). I think that's available in American FactFinder (with hopefully not too much digging). I would assume that the best you could find is 5-year data, but with the ACS, there might be more granular estimates.

  • trulee_pist

    I think the most conservative, safest interpretation is "consumer confidence in the future is down in this region over the past year" (based on N=800). There is nothing in these data that lends statistical support to a conclusion that DC residents have views that differ to a statistically significant degree.

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