Below is a recap of the Local Economics Summit featuring Leslie Appleton-Young, California Association of Realtors Chief Economist spoke to Realtors and local elected community officials this week. She had several important messages and concerns for the real estate community.
The Bay Area is the strongest economy in the Nation, so we are not just talking about just California. This strength is principally due to plentiful jobs in the tech industry. However, she points out many caveats.
In 2014 the recovery from the 2008 – 2009 economic crash was complete.Prices peaked in 2013 and some areas continue to grow at a more rapid pace.
The economic crash limited new housing starts creating part of the lack of inventory we see today. There are other factors as well. First, baby boomers are remaining in their homes much longer than normal, as they cannot afford to move and lending guidelines may limit purchasing power. Proposition 60/90 may no longer helpful as prices and potential taxes will be too high.
This leads to the second concern, “where will our children live?”
In the Bay Area affordability is the biggest challenge. Those with moderate incomes such as teachers and firemen cannot afford to live near their jobs. Millennials are looking for the complete lifestyle package (walk to restaurants, stores and parks) but can they afford it? Can families remain in the same town or area to enjoy grandchildren and family gatherings that strengthen familial bonds?
Leslie quoted from the California Common Sense
Unsustainable California: Top Ten Issues Facing the Golden State as of June 2014
“California as we know it is simply unsustainable. To correct California’s unsustainable course, the state requires informed citizens and leaders willing to tackle the state’s budget realities.”
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