California Economy

[CityDataIsAFraud]

I know the unemployment rate is rising in California. How bad is the economy, not to mention how overwhelmingly expensive the houses are on the west coast?

Will there be a time that the economy in California will get back on it's feet and the house prices would be fairly priced?

[skytrekker]

From what I have read on the housing blogs, housing in California has fallen 30-50% since 2006. And will likely fall another 10-15% this year.

In the San Francisco Bay area, one of the nations most desirable places to live, prices have fallen about 31%. The median home price 2 years ago was over 750K- and now its down to just over 500K.

In southern California the median home price has fallen from 550-600K to 285-325K.

So housing has fallen to more 'reasonable' levels- though still higher then many other locations.
As for the economy, unemployment is reaching depression levels of over 10%- and that figure may be understated- it seems probable that it will take a few years for California to dig itself out of the deep hole it is in- but this holds true for most of the country.

[doglover]

Is there any state that hasn't been affected as deeply as most of the nation?

[NYCGirl]

Seems CA and Fla have taken the biggest hits-of course MI is there also.

[BayBreeze]

Larger states = more people for fewer jobs
More traffic = more wear and tear on infrastructures
More people = more need for law enforcement

Seems to me, bigger is worse. But, I don't know.

[skytrekker]

Connecticut's economy is also slumping badly

see Home Sales, Prices In State Experience Record Drop -- Courant.com

also Rell Says State Faces 'Painful' Spending Cuts -- Courant.com

The states housing market is slumping badly-- perhaps not with the ferocity of CA and FL - but still bad

also the Governor was on TV tonight crying about tough times ahead.

[HelloThere]

The cost of housing will adjust to fundamentals (i.e., local incomes) within 2-3 years. Housing in California has been a bit inflated since the 1970's, but just 10 years ago it was fairly affordable.

California's real problem are the regulations and taxes in the state. The absolutely only reason a business would stay or relocate to California at this point is because the large pool of talented workers. But a number of areas across the country have reached a sort of "critical mass" where there are now enough educated workers in the area for businesses to relocate.

California is unlikely to solve its problems any time soon. And by that I mean at least a decade down the road.

[Cali-girl]

The Orange County Register has a blog that you may want to check out regarding the ups-and-downs of the housing market:

Lansner on Real Estate - OCRegister.com

The Los Angeles Times had a great blog by Pete Viles, but he was replaced and now readers are boycotting it because its been watered down.

I have the unique position of living in 2 States - coastal Cali and southern NM.

I can promise you that on the 10 freeway, which is about 1 mile from my residence in NM, the license plates tend to go from CA to TX - probably Austin. For a while in 2007 and 2008, there were many FL vehicles headed West on the 10 towards AZ or CA. Maybe they went to NV, not sure.

but when times get tough, CA is very expensive to live in and wait out an economic downturn. Its so expensive, that most folks have to pack it up and leave to where its less costly.

~Cali-girl

[Cali-girl]

Originally Posted by Cali-girl

The Orange County Register has a blog that you may want to check out regarding the ups-and-downs of the housing market:

Lansner on Real Estate - OCRegister.com

The Los Angeles Times had a great blog by Pete Viles, but he was replaced and now readers are boycotting it because its been watered down.

I have the unique position of living in 2 States - coastal Cali and southern NM.

I can promise you that on the 10 freeway, which is about 1 mile from my residence in NM, the license plates tend to go from CA to TX - probably Austin. For a while in 2007 and 2008, there were many FL vehicles headed West on the 10 towards AZ or CA. Maybe they went to NV, not sure.

but when times get tough, CA is very expensive to live in and wait out an economic downturn. Its so expensive, that most folks have to pack it up and leave to where its less costly.

~Cali-girl

I would like to update my circumstances - I am no longer living in NM - I moved out of NM this past summer; I live in the Bay Area exclusively now :)

Its been big news here in the SV that the local unemployment rate has dropped a small percentage (still slightly over 11 percent). However, people are trying to grab onto anything and spin it in the best possible light since the whole economic thing is depressing.

~Cali-girl