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Old 08-03-2010, 09:34 PM
 
80 posts, read 213,106 times
Reputation: 33

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In my humble opinion, they only thing that is keeping California's market prices high is congestion...

Which equals higher demand.... which equals higher prices.

Basic economics.

Aside from media portrayal, desirability & weather.

Once congestion & population goes down, prices will go down. More foreclosures are also coming as banks are going to start releasing shadow inventory. LA also has the highest unemployment & living is very expensive compared to income.

I think prices will collapse in 2 years if illegal immigration is taken care of and more people move out.

Comments?

PS. I plan to move to LA soon but only on rent. I want to see how the real estate market plays out before I take the plunge.
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Old 08-03-2010, 09:38 PM
 
Location: SoCal
2,261 posts, read 7,233,328 times
Reputation: 960
I'm sure the weather has NOTHING to do with it!
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Old 08-03-2010, 09:40 PM
 
80 posts, read 213,106 times
Reputation: 33
^ some folks hate harsh winters...
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Old 08-03-2010, 09:46 PM
 
Location: Las Flores, Orange County, CA
26,329 posts, read 93,771,454 times
Reputation: 17831
Quote:
Originally Posted by mcmsinger View Post
In my humble opinion, they only thing that is keeping California's market prices high is congestion...

Which equals higher demand.... which equals higher prices.

Basic economics.

Aside from media portrayal, desirability & weather.

Once congestion & population goes down, prices will go down. More foreclosures are also coming as banks are going to start releasing shadow inventory. LA also has the highest unemployment & living is very expensive compared to income.

I think prices will collapse in 2 years if illegal immigration is taken care of and more people move out.

Comments?

PS. I plan to move to LA soon but only on rent. I want to see how the real estate market plays out before I take the plunge.

Nice weather and jobs and amenities and geography and diversity and advertising increase demand.
(In a normal market) Demand drives high prices if supply is constant.
Infrastructure not keeping up with demand (or poor design or damaged freeways due to earthquakes or ....) causes congestion.

The odds that illegal immigration (and current illegal aliens) are "taken care of" in the next 50 years are "slim" and "none" and "slim" has just been diagnosed AIDS and colon cancer. It would require a human, "ethnic cleansing" search and destroy mission so great it would make the Gestapo and the Einsatzgruppen SS paramilitary death squads look like The Three Stooges.

The day Los Angeles becomes another Buffalo or Detroit and population decreases significantly is the day both the Clippers and the Kings win championships in the same year.

Last edited by Charles; 08-03-2010 at 09:56 PM..
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Old 08-03-2010, 09:49 PM
 
80 posts, read 213,106 times
Reputation: 33
^ good points & rebuttal.
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Old 08-03-2010, 09:58 PM
 
11,715 posts, read 40,455,391 times
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No matter how far the quality of life sinks, there's millions of peasants down south who see it as a paradise by comparison.
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Old 08-03-2010, 10:03 PM
 
80 posts, read 213,106 times
Reputation: 33
^ That's true to some extent.

If you ever want to live well in California it's all about the $$$$ mainly. Of course you can also argue against this somewhat...

But congestion is a problem of California.

I do think that eventually people living a "lower quality of life" will start to realize this sooner.

PS. Anybody is free to disagree with me & I don't mean to offend anyone.
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Old 08-03-2010, 10:08 PM
 
Location: Los Angeles, CA
787 posts, read 1,943,080 times
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I think Charles has summed it up pretty nicely.

I would just add that congestion is a symptom of demand which is driven by all the items mentioned already (geography, climate, etc).

Even in this steep recession LA has added population, albeit at a relatively slow pace. Even if illegal immigration were stopped 100% tomorrow (an unlikely proposition), the population will continue to increase through natural increase (which is higher here than places like Detroit) and legal immigration.
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Old 08-03-2010, 10:19 PM
 
80 posts, read 213,106 times
Reputation: 33
^ That is also true.

Some of California's job markets are recession-proof. (Entertainment is always hot even in a recession as people will always crave entertainment to get-away from there problems.)

PS. I'm not implying everyone is in Hollywood in California
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Old 08-04-2010, 10:17 AM
 
Location: Los Angeles, CA
787 posts, read 1,943,080 times
Reputation: 379
Quote:
Originally Posted by mcmsinger View Post
^ That is also true.

Some of California's job markets are recession-proof. (Entertainment is always hot even in a recession as people will always crave entertainment to get-away from there problems.)

PS. I'm not implying everyone is in Hollywood in California

I think nearly every sector got hit hard this time...although the LA Economic Development Corp. (which studies the LA economy) notes in its latest forecast that the entertainment sector is finally starting to add jobs again amd is in a better position than most local industires.

LAEDC - Economic Information (http://www.laedc.org/reports/ - broken link)
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