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Beacon Economics, a private consulting firm co-founded by former UCLA Forecast Economist Chris Thornberg, is out with its own forecast - the day before UCLA's widely followed report is being released. Interesting timing. The Beacon forecast sees California home prices at their bottom and residential construction picking up steam. From the report:
After falling for nearly two-and-a-half years consecutively, single-family building permits have increased slowly over the past nine months. We expect this trend to continue as builders reenter the marketplace and as demand for new homes rises in the face of falling unemployment.20 for new homes rises in the face of falling unemployment.
Thornberg had been bearish early on about the CA real estate market - quite a bit earlier than other regional economists - so this relatively bullish outlook is noteworthy.
When the state emerges from the current downturn it will have two advantages it didn't have when the downturn began. First, the state will see a more favorable market for its goods and services overseas. We expect the current weakness in the U.S. economy to continue into the foreseeable future. This will help enhance the state's international competitiveness. Lastly, housing is a net benefit for the state. While individually homeowners are feeling pinched by falling prices, affordable housing will help local businesses attract new skilled employees and make California more competitive in the national labor force.
*Chapman weighs in: Economist Esmael Adibi says that Orange County will see a faster recovery next year than the state, which will be held back by job losses in construction and real estate in the inland and rural areas. In its forecast for next year, the Chapman University economists expect California to emerge from the recession in the latter part of 2010. (OC Register)
Mark Lacter created the LA Biz Observed blog in 2006. He posted
until the day before his death on Nov. 13, 2013.