What is the source of wealth? (Irvine: real estate market, mortgage, refinancing)

[Julianq101]

I was wondering what the various sources of wealth is in the OC. From what I understand, there is a lot of wealth there, and lots of the folks on the board talk about there being tons of opportunity.
What are the industries that is driving all the money?

[fpbear]

I have watched OC industries change since 1975. In the early days the oil industry pumped a lot of money into the area. Then it was defense, and now, the financial industries. In the past 5 years the mortgage industry has boomed and I could see new financial services buildings pop up all over. The mortgage industry is heading for a collapse. I am curious what will happen to the OC economy as the housing market crashes. OC will probably need to reinvent itself once again, perhaps putting more emphasis on the technology sector.

[RAMFEB31]

Originally Posted by fpbear

I have watched OC industries change since 1975. In the early days the oil industry pumped a lot of money into the area. Then it was defense, and now, the financial industries. In the past 5 years the mortgage industry has boomed and I could see new financial services buildings pop up all over. The mortgage industry is heading for a collapse. I am curious what will happen to the OC economy as the housing market crashes. OC will probably need to reinvent itself once again, perhaps putting more emphasis on the technology sector.

'FP' True,the sub prime mortgage business is somewhat going south but they are really only a small portion of economy that have driven O.C. The financial institution is still strong. Hi tech is going great. Boeing is still stuffing money into O.C. Defense is still being funded here. Because of the great all around weather, great beaches all kinds small and meduim size businesses spring up. Service industries is big here. Those big boats out in the local harbors need constant care, for instance.

[fpbear]

OC is good at reinventing itself and catching on quickly to the latest hot spot in the economy.

It is funny the mailman just arrived and I just opened this letter in the mail. It is from HomeLoanCenter/CashFast advertising their mortgage refinancing. The address? 163 Technology Drive, Irvine, CA. I wonder why such letter don't come from New Jersey or Nebraska or somewhere else. They always seem to come from OC.

[Paddington]

It's good to keep in mind that there's a difference between wealth and economic activity.

The coastal parts of California are known for having rich people from all over the world coming there and buying homes. This brings a tremendous amount of wealth into the region, which is visible, but does not mean that great amounts of economic activity are taking place locally.

[fpbear]

Paddington, that is very true. Also noticed a lot of people from China are buying up property in OC after the Chinese economic boom.

[fashionablecowboy]

Many people own their own businesses or have invested their money in real estate.

[Julianq101]

I notice that there was reference to outsiders coming in to buy beachfront homes - a form of 'imported' money. I was wondering along those lines: how many people were generating high levels of income from home-grown business versus those who arrive with a big amount of money and buy into the OC lifestyle.

I'm assuming lots of expensive parts of the west coast have imported wealth. Could that also be one of the big reasons why real estate prices grew in such a way that median home prices don't mirror median income levels? Looks like the real estate market has an interesting period ahead right now but as long as there's a group of outsiders (with cash) wanting to move there, there will be some level of a buffer against a major price crash. But it does look like the real estate growth boom is over.

Well, with diverse economic drivers pushing your economy, you might be better positioned to handle any bubbles that burst.

[nevercoldcall]

I find that it's mostly entrepreneurial, and as Paddington said there isn't necessarily a connection between wealth and local economic activity.

For example: I'm a bestselling author, my neighbor across the street is a developer, my next-door neighbor is a high-profile personal trainer who owns a gym, a friend we had dinner with last night owns hotels nationwide, etc.

So other than the training gym, none of these sources of wealth have an economic base in OC.

It also shows that there is not necessarily any one industry tied to OC ... it's all about the individual finding his niche and making a living with it.

[kturbe]

90% of the businesses in the OC are entrepeneurial and have less the 50 employees which leaves the economy very very balanced as we don't rely on one industry for jobs etc. Venture capalist poor money into the area based on the technology, finance and a huge travel business. You see strong sales, marketing industry locally with service jobs outsourced to cheaper areas. But where do the CEO's, VP's etc want to be, it is here!