Using some current numbers and some forecasting, those who watch finances and real estate closely do not see any red flags from the Donald Trump Presidency for at least 12 to18 months. After that, it’s too far out to predict with all the “Trumponomic” variables including international trade agreements, and the plan to bring more jobs from out of the country back to the U.S.
Speaking to the Santa Barbara Executive Roundtable breakfast, Mark Schniepp with the California Economic Forecast said his information is not changing and the economy locally will be strong. Unemployment and interest rates are low and he says this is a “golden economic time.”
This comes, he says, at a time when there could be changes in the national health care or Obamacare, more military spending and economic issues with other nations.
Overall Schneipp says the country has a big debt to deal with and we will need “a faster economic growth.”
In the past the average duration of an economic expansion has been about nine years. Schneipp says the strong economy could have a setback in 2018 based on that trend but doesn’t expect it to be serious.
Schniepp also advises students to get more than a basic college education if they can. He suggests a focus on a vocation or areas including science, technology and health, because that is where many jobs will be developing and sustainable.
Some entry level jobs are going to be automated including something as simple as ordering your food at a restaurant where some customers are doing it on an I-Pad, instead of talking to a server.
Santa Barbara’s Funk Zone and nearby waterfront businesses are expected to be booming next year. Brian Johnson with the Radius Group says businesses that are priced out of State Street or other downtown sites are looking to the Funk Zone because it has a growing amount of foot traffic and unique attractive businesses. Many restaurants, wine tasting rooms, beer bars and art galleries are open there with more to come.
Nearby the La Entrada hotel and shopping site is going in after more than two decades of community debate. That is going to come with a splashy, highly publicized opening that will be conveyed throughout Southern California and beyond as part of new look to the “gateway” to the city looking up from Stearns Wharf.
“The locals are really excited about the Funk Zone and everything it has to offer,” said Johnson.
Nearby in Carpinteria, commercial space is barely available and several larger companies have some of the only remaining buildings. In the last year Procore Technologies has expanded tremendously and was quick to scoop up the available space left behind when CKE left the area on the bluffs campus near Bailard Ave.
The vacation rental business and new regulations in some areas sparked some questions at the morning discussion. Schneipp says despite some new rules to control vacation rentals, he did not see any evidence that they hurt housing in neighborhoods and called the political actions “unsubstantiated.” He also said taking some homes out of the short term rental market will not help rentals overall.
Longtime realtor Keith Berry said, social media has been a strong component to the housing market not only with the sharing of information about property for sale, but also, the way realtors and their clients do business. Berry says 70 percent of all transactions are local buyers and sellers.
AmeriFlex Financial Services President Justin Anderson said he sees a solid economy in the near term and does not see the need for radical investment changes. He did say interest rates could be climbing next year as the economy makes a limited correction. For now Anderson described the financial future ahead as uncharted waters.
Institution Ale co-owner Shaun Smith stands near his Santa Barbara brewery’s controversial neon sign. (Joshua Molina / …
Institution Ale's Ryan Smith and son Shaun Smith at the family's new State Street location. Photo: Paul …
Summary of market insights and analysis from Q2 2019 South Coast commercial sales and leasing activity: Download the complete report here …