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Sunday, May 07, 2006

Inland empire on shaky RE ground


Americans fleeing big cities in search of cheaper homes« on: April 22, 2006, 10:05:22 AM »
This is from an MSNBC article. [url][/urlReport: Americans fleeing nation's big citiesPeople moving further from metropolitan areas in search of cheaper homes]Riverside, Calif. a burgeoning cityThe metropolitan area that attracted the most new residents was Riverside, Calif., which has been siphoning residents from Los Angeles for years. The Riverside area, which includes San Bernardino and Ontario, had a net gain of 81,000 people a year from 2000 to 2004."Riverside has grown to become the 13th largest metropolitan area in the nation. It’s a short drive to several mountain ranges, and it’s within driving distance of the beach. Locally, it is known as the Inland Empire....“When you look at housing prices in Southern California, along the beaches and coastlines, you’re able to obtain a very large home for a much lower price” in Riverside, said Cindy Roth, president and CEO of the Greater Riverside Chambers of Commerce....Homes in Riverside aren’t cheap. The median price — the point at which half cost more and half cost less — was $374,200 in 2005. But they are less expensive than Los Angeles, where the median price was $529,000."My comments:If gap between Riverside/inland empire prices and LA /OC prices continue to narrow, then the attractiveness of the IE declines. Why?. because the IE has little to offer, despite the glowing accounts on this and other commentator sites. It has relatively fewer high-end jobs and not much high-tech industrial corporate parks such as south OC has. And few commercial hi-powered commercial/banking/fimancial clusters such as Dwtn/westLA or Costa Mesa?newport beach. The IE is as of now basically one gigantic residential exurban sprawl for households who fled from the high coast prices and found low-cost homes in these boonies. And they have had to commute long distances to ther LA/OC coast to the jobs which are still concentrated along the coasts. Have been all over the IE and have seen few hi-end industrial/commercial/financial parks such as is found along the LA?OC coast. Those large gigantic commercial industial buidings that one sees in the CHino, ontario and fontana area are mostly large warehouses for receiving and transhipping all the imported studf from overseas, mostly china stuff. Warehousing/logistics does not offer much high-paying positions except fot a few at the intermediate and up management levels, and maybe class A trucking, which income is unstable. In Short there is not in the IE at this time a really built-up concentration of hi-end industrial/commercial/financial jobs and sectors to justify continuing RE home price appreciation. The bubble is now peaking and prices still going up due solely to demand for agffordable housing by Angelinos and OC'ers who are priced out of the coast. At Some point the IE prices will stop increasing as supplycontinues to build up and homes in IE cease to be affordable due to the Coast refugee's export of the coast bubble to the IE. ualty.com/forum/index.php?topic=599.0

1 comment:

AnalysisGuy said...

Just released the FREE San Diego and Las Vegas reports. They join prior reports on Boston, Bakersfield, Chicago, Denver, Miami, San Francisco, Seattle & Los Angeles.