University of California Riverside : Housing Needed to Sustain Economic Growth in Inland Southern California

'Inland Southern California Regional Intelligence Report' highlights trends in employment, spending and real estate

By Sarah Nightingale on January 28, 2016

RIVERSIDE, Calif. (www.ucr.edu) - The Center for Economic Forecasting and Development at the University of California, Riverside's School of Business Administration, released its first Inland Southern California Regional Intelligence Report on Thursday (Jan. 28). The report provides data and intelligence on employment, local spending, and residential and commercial real estate in the inland region (Riverside and San Bernardino counties). It is set to be published three times each year.

Job growth in Inland Southern California is outpacing the state, but more housing is needed, a UCR report shows.

Key findings from the January report include:

• In 2015, Inland Southern California continued its 5-year trend of outpacing the state and nation in job growth (with seasonally-adjusted numbers showing a 3.6% increase between December 2014 and December 2015, compared to 2.9% and 1.9% for the state and nation, respectively). Unemployment in the region now stands at 6.2%, far below the 14% peak reached at the height of the Great Recession.
• From the 3rd quarter of 2014 to the 3rd quarter of 2015 (the latest available numbers), home prices in Inland Southern California appreciated at twice the rate they have in the state as a whole (8.3% vs. 3.9%). The area remains comparatively affordable, however, with a home in Los Angeles County currently costing about 40% more and a home in Orange County about 50% more.
• Demand for rental properties in both the Inland region and Los Angeles is some of the strongest in the nation. Inland, as of the 3rd quarter of 2015, only 2.6% of all rental properties were vacant, 0.4 percentage points lower than the year prior.
• Despite the strong housing and job numbers, new permits for residential construction have remained flat, growing at a pace that is one-quarter of what it was a decade ago.

Christopher Thornberg, director of the Center for Economic Forecasting and Development, said the growing demand for housing, which is driving up prices in both the buyer and rental markets, has not been met with a real plan to build more homes.

'There is a lot of good news coming in about the Inland Southern California economy, but in order to sustain that positive growth, including population growth, the region simply has to have more housing. This is a serious issue across the state and one of the biggest threats to the long term health of California's economy,' he said.

The full report is available here. Thornberg is available for media interviews.

Archived under:Business, Center for Economic Forecasting and Development, Christopher Thornberg, employment, housing market, inland empire, inland southern california, press release, real estate, School of Business Administration

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