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California's Housing Market
A lot of job growth in the state of California in the past year can be attributed to the growing housing market. A lot of this growth was in the construction and mortgage industries. Real estate agencies and mortgage loan companies added nearly 1500 jobs in November of 2005.
San Diego’s strong market can be accredited to the area’s recent job growth, low vacancy rates, and a decrease in apartment supply. Real estate experts maintain that alongside Miami, San Diego is the only metro area in the country where the supply of apartments is declining.
Apartments are being converted into condos faster than new ones are being built. Along with a growing population, this may cause vacancy rates to become even lower, leading to a further increase in demand for condos in San Diego. The number of investors buying condos, both natural and converted, is another facet that bolsters the strength of the San Diego market. A percentage of these condos will most likely end up reappearing back onto the rental market.
Many economic analysts, while hopeful about the job growth in November, are worried about the real estate sector. If real estate companies and construction companies continue to shed jobs over the coming year, it will certainly have an effect on the number of jobs in the state, as well as the strength of the economy.
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