By Toni Momberger, Redlands Daily Facts
Posted: 10/03/2012 04:26:20 PM PDT
Updated: 10/03/2012 06:47:38 PM PDT
For Southern California real estate, experts agree no recovery is in sight.
According to a recent housing price study by the Institute for Spatial Economic Analysis at the University of Redlands, the real estate market in San Bernardino and Riverside counties will remain flat for at least two years.
“That doesn’t mean that it will be better in two years,” said Johannes Moenius, director of the institute. “That’s just the time period defined for the study. “The further out you go the more uncertain it gets.”
In fact, Michael Carney, director of the Real Estate Research Council, which tracks and analyzes data in each of the seven Southern California counties, who famously does not make predictions, went on record saying the Southland market will not see substantial increases in home prices until at least 2030.
“For the next two years, home prices will move up and down, and people will get excited from time to time, but there will be no dramatic change that will last for long,” said Carney, who is also a professor of finance and real estate at Cal Poly Pomona.
“My overall view about home sales and prices for Southern California as a whole is the same as the UofR forecast for the next two years, in other words, not much change in home prices and home sales.”
According to Moenius, unemployment was the most important factor, and he said better job numbers anywhere in Southern California will improve the market.
“Forty percent of people in Inland Empire work in a different county than where they live,” Moenius said. “If jobs are coming back in Los Angeles County, it affects the market in San Bernardino County moderately.”
According to an institute study last year, Redlanders spend an average of 4 percent to 6 percent of their income on gas just to get to work. In San Bernardino, it’s more than 8 percent.
Moenius said that one of the reasons the Inland Empire was hit the hardest nationwide is that the average level of education is lower than the Southern California average and the national average.
“If you look at where jobs are coming back, a lot of them are highly qualified jobs where you need a bachelor’s degree,” he said. “That makes it more difficult for the labor force.”
When people have stable jobs, they buy houses and you have owner occupancy, better maintenance and less blight, he said.
“Neighborhood stability is a big factor for people,” Moenius said. “Once you break the stability, you’re basically opening the floodgates.
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