Loren Scott: Louisiana real estate rides growth, but headwinds remain

May 1, 2026 - 02:39

A mix of steady economic growth and rising uncertainty is shaping Louisiana's real estate outlook, according to economist Loren Scott. He delivered the keynote at the 2026 Trends in Baton Rouge Real Estate seminar Thursday morning. Scott described the current climate as a blend of good news and not-so-good news.

Scott said national recession fears remain low, but economic growth is underperforming expectations. GDP forecasts have been trimmed, and while the state has seen job gains in sectors like industrial construction and healthcare, other areas are lagging. The energy sector, a traditional driver for Louisiana, continues to face volatility, which creates a drag on broader expansion.

On the real estate side, Scott noted that commercial and residential markets are both feeling the effects of higher interest rates. Borrowing costs have cooled demand for new homes and refinancing, though the supply of available properties remains tight. That imbalance is keeping prices elevated in many parts of the state, especially in Baton Rouge and the New Orleans metro area.

Scott also pointed to lingering challenges from hurricane recovery and insurance costs. Property insurance premiums have risen sharply, making it harder for both buyers and developers to move forward. He warned that if insurance costs continue to climb, they could slow down new construction and investment.

Despite these headwinds, Scott expressed cautious optimism. He said Louisiana's economy is resilient, and the real estate market is likely to remain stable as long as interest rates ease and the energy sector finds firmer footing. The key, he said, will be how the state adapts to ongoing national and global pressures.