Radius Real Estate & Economic Forecast Points to Recovery — Slowly but Surely
|Dan Walters, a political columnist for the Sacramento Bee, delivers the keynote address. (Gina Potthoff / Noozhawk photo)|
Despite lingering pessimism among Americans, agents and experts predict a positive future will bring more jobs and housing.
Santa Barbara, CA – Grumbling about the poor state of the economy may be at an all-time high, but indicators of pending recession relief are actually largely positive, according to the views of one economist Thursday.
Explaining the disconnect between the economic reality and the pessimistic attitude of many Americans was a major focal point of the sixth annual Radius Real Estate & Economic Forecast, hosted Thursday morning at Fess Parker’s DoubleTree Resort.
The federal government shutdown and sequestration aside, national, state and local economies and real estate markets have been relatively unaffected and appear to be on the mend heading into 2014.
Mark Schniepp, director of the California Economic Forecast, told an audience of more than 100 vested parties that still too-high unemployment rates and meager household incomes were key factors cultivating the negative outlook.
“If we were really affected by the government shutdown, you would certainly see it in the financial market,” Schniepp said. “None of these issues have really had an effect on the economy. Consumers are buying a lot of stuff. We’re moving very slowly.”
Schniepp’s observations seemed to mirror many of those presented prior to his speech by real estate agents and experts at Radius Commercial Real Estate & Investments.
Businesses are spending more money on equipment and software than labor, which helps explain why so much large, commercial office space remains vacant in Goleta, he said.
Leasing on the South Coast in 2013 has been slightly up from last year, with office and retail vacancy rates up and industrial vacancy rates decreasing somewhat.
Out-of-market investors also have been more aggressively spending to buy up properties in the South Coast sales market, according to Radius principal Brad Frohling, who seemed hopeful for another big fourth-quarter showing.
“This year is the year of the investor,” Frohling said, noting that two-thirds of sales have been to investors.
So many buyers but so little inventory proved to be the prevailing theme of local residential real estate in the Tri-County area, said Steve Golis, a Radius principal.
Golis said home ownership did appear to be declining with the rise of a more tech-savvy and more nomadic lifestyle.
The technology sector is where job seekers will find the most opportunity, Schniepp said, most likely in occupations that require innovation, problem-solving and analysis.
The number of jobs created in Santa Barbara County has been in line with the overall increase in population, and close to 3,000 jobs should be added in 2014, Schniepp said.
He told attendees the housing market would lead to growth in 2014, with new housing and a healthy stock market also recovering.
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