California's Divided Fortunes Economy Is Beginning to Recover on the Coast, but Inland Areas Remain in a Rut (WSJ) (Los Angeles: real estate market)

[Lifeshadower]

California Economy Gains Footing, but Only on the Coast - WSJ.com

This is a bad sign, considering that California's highest growing areas are Inland.

http://en.wikipedia.org/wiki/Table_o...tistical_Areas


Blue: Coastal MSA
Red: Inland MSA

California MSA's by growth rate 2000-2008
Riverside-San Bernardino, CA MSA 26.45%
Bakersfield-Delano, CA MSA 20.98%
Madera, CA MSA 20.49%
Stockton, CA MSA 19.30%
Yuba City, CA MSA 18.77%
Sacramento-Arden Arcade-Roseville, CA 17.42%
Merced, CA MSA 16.89%
Visalia-Porterville, CA MSA 15.83%
Hanford-Corcoran, CA MSA 15.49%
El Centro, CA MSA 15.18%
Modesto, CA MSA 14.25%
Fresno, CA MSA 13.73%
Redding, CA 10.39%
Chico, CA 8.45%
San Diego-Carlsbad-San Marcos, CA MSA 7.59%
San Luis Obispo-Paso Robles, CA MSA 7.55%
Napa, CA MSA 7.37%
Oxnard-Thousand Oaks-Ventura, CA MSA 5.91%
San Jose-Sunnyvale-Santa Clara, CA MSA 4.80%
Los Angeles-Long Beach-Santa Ana, CA MSA 4.10%
San Francisco-Oakland-Fremont, CA MSA 3.66%
Vallejo-Fairfield, CA MSA 3.29%
Santa Rosa-Petaluma, CA MSA 1.77%
Salinas, CA MSA 1.61%
Santa Barbara-Santa Maria-Goleta, CA MSA 1.51%
Santa Cruz-Watsonville, CA MSA -0.96%

I wonder if this will mean less growth rates for the inland areas?

[CAVA1990]

Trickle down economics at work. A lot of coastal residents incomes come from somewhere else. Places like IE which rely more on local economic activity and less on government and Wall Street will be the last to recover.

[KC6ZLV]

So, what do these numbers really reflect, other than someone, some administration somewhere, is hell-bent on convincing us the country's economy is improving?

Who is buying the houses? Are they the ones who didn't lose jobs? Is it simply a result of lower housing prices? What about the unemployment rate? The unemployment rate isn't an accurate indication of what is going on with employment. For example, long-term unemployed are not counted in that statistic.

Since these areas are some of the most expensive in California, there is a possibility some number of unemployed people moved elsewhere. That changes the local unemployment statistics.

[FresnoFacts]

Anyone who wants to say that all of California's regional economies should perform the same is out of touch. It has never been that way, the state is way too diverse.

It has happened many times in the past that some areas of the state are performing differently than others in both booms and recessions. Why should it be any different now?

Also bad is only using a 1 month year over year housing comparison and only Nov to Dec unemployment changes.

Their housing number forgets that December 2008 saw Bay Area prices fall almost 47% vs. Dec 2007. In the Fresno area the drop was only 39% in Dec 2008 vs Dec 2007. Does that then mean the recession was not as bad in the inland areas? Of course not.

The article also says unemployment went up in most of the inland. But that happens almost every year, even in booms. There is more seasonal employment in the inland areas and the additional unemployment between Nov and Dec is not uncommon.

And someone needs some geography lessons at the WSJ. San Diego is really not tied to Los Angeles economically. The Inland Empire which includes many job commuters to Los Angeles and Orange Counties should be tied together closer with those counties. And the Central Valley includes Sacramento to Redding.

[lrmsd]

Originally Posted by Lifeshadower

California Economy Gains Footing, but Only on the Coast - WSJ.com

This is a bad sign, considering that California's highest growing areas are Inland.

Table of United States Metropolitan Statistical Areas - Wikipedia, the free encyclopedia


Blue: Coastal MSA
Red: Inland MSA

California MSA's by growth rate 2000-2008
Riverside-San Bernardino, CA MSA 26.45%
Bakersfield-Delano, CA MSA 20.98%
Madera, CA MSA 20.49%
Stockton, CA MSA 19.30%
Yuba City, CA MSA 18.77%
Sacramento-Arden Arcade-Roseville, CA 17.42%
Merced, CA MSA 16.89%
Visalia-Porterville, CA MSA 15.83%
Hanford-Corcoran, CA MSA 15.49%
El Centro, CA MSA 15.18%
Modesto, CA MSA 14.25%
Fresno, CA MSA 13.73%
Redding, CA 10.39%
Chico, CA 8.45%
San Diego-Carlsbad-San Marcos, CA MSA 7.59%
San Luis Obispo-Paso Robles, CA MSA 7.55%
Napa, CA MSA 7.37%
Oxnard-Thousand Oaks-Ventura, CA MSA 5.91%
San Jose-Sunnyvale-Santa Clara, CA MSA 4.80%
Los Angeles-Long Beach-Santa Ana, CA MSA 4.10%
San Francisco-Oakland-Fremont, CA MSA 3.66%
Vallejo-Fairfield, CA MSA 3.29%
Santa Rosa-Petaluma, CA MSA 1.77%
Salinas, CA MSA 1.61%
Santa Barbara-Santa Maria-Goleta, CA MSA 1.51%
Santa Cruz-Watsonville, CA MSA -0.96%

I wonder if this will mean less growth rates for the inland areas?

The inland areas were the highest growing mainly due to commuters/bedroom communities-ie,people could afford riverside,sac and/or modesto,so they bought and commuted. This inflated the housing prices,along with jumbo loans for loans that people could not really afford on their income. The inland areas did not really grow on their own-ie,there has not been alot of growth,relative to what would be needed in order to sustain a population there. Most people were commuters,so it makes sense that the coastal regions affected the inland.
It also makes sense tha thte coastal regions would recover more quickly-they have always been the economic centers-despite attempts to get folks to go to sacramento and create an economic base there that would rival the coastal areas.

It really doesn't make or break the recovery to had the inland areas recovering as robustly as the coast. The inland is 'newly prospered'-obviously,what had built up there,was not sustainable [economically or socially]. There must be a solid infrastructure in place in order for a place to thrive and weather storms. This has not yet happened inland [except for waaaaaay back in the gold rush days].
So we should not look to recent models of growth that showed the inland areas as significant to the health of the economy. Much of the housing there is newer,and in that way,is only recently relevant to the real estate market as well.

I know someone will mention this industry or company or that one,or talk about how long they've been living in san bernardino [multiple generations],but those are small numbers compared to overall trends.

And I really think the 'inland' phase was really that: a phase or a trend. An experiment that was not viable and therefore did not last.

We need to move on and look to something new-CA can do this. Innovation and creativity have always been hotbeds here.

It will require not seeing economic health as tied to recent growth cycles only. Bigger picture view is needed. And creative ideas for economic growth/entrepreneurs,etc.

[lrmsd]

Originally Posted by FresnoFacts

Anyone who wants to say that all of California's regional economies should perform the same is out of touch. It has never been that way, the state is way too diverse.

It has happened many times in the past that some areas of the state are performing differently than others in both booms and recessions. Why should it be any different now?

Also bad is only using a 1 month year over year housing comparison and only Nov to Dec unemployment changes.

Their housing number forgets that December 2008 saw Bay Area prices fall almost 47% vs. Dec 2007. In the Fresno area the drop was only 39% in Dec 2008 vs Dec 2007. Does that then mean the recession was not as bad in the inland areas? Of course not.

The article also says unemployment went up in most of the inland. But that happens almost every year, even in booms. There is more seasonal employment in the inland areas and the additional unemployment between Nov and Dec is not uncommon.

And someone needs some geography lessons at the WSJ. San Diego is really not tied to Los Angeles economically. The Inland Empire which includes many job commuters to Los Angeles and Orange Counties should be tied together closer with those counties. And the Central Valley includes Sacramento to Redding.

yes,camp pendleton [thank god for camp pendleton!]has meant that SD and LA have not become one giant sprawling metropolis. (: Otherwise,it could and probably would happen!

And you are so right-why would the regional areas always be performing the same?
When you look at the 'red vs. blue',it's almost laughable,to me-i mean,huge metro areas vs. relatively smaller,historically depressed economically or agriculturally based areas...should they really be compared? It's silly to me.

[lrmsd]

I do think there will be less growth for the inland areas,yes.to answer OP. It's almost common sense,when you look at those regions,to come to this conclusion. They will rely on local and regional growth and business,and requires a non commuting population to make this happen. Not that likely,in my opinion only of course.

[grimstuff]

It's actually very simple, and not at all surprising. The inland areas of CA were the places that were booming from cheap housing, and they have further to go to correct the markets. Coastal areas have grown slower overall and the housing market was not near as over-inflated.