ECONOMY SEEMS TO SLIP BUT UCLA SEES EARLIER RECOVERY IN ORANGE COUNTY

UCLA predicts that California, “will slog through another year of double-digit unemployment, but Orange County and other coastal counties will bounce back before the inland communities.”  This and other facts came out in their quarterly forecast.  The forecast sees the state unemployment rate averaging 12.1% this year with 167,000 jobs being added.  Unfortunately, that will not make a dent in the 1.3 million jobs lost throughout the recession.  The report went on to state, “the economy will begin to pick up slightly in the beginning of 2011 and by the middle of 2011 begin to grow at more normal levels.”
 
Nationwide, experts predict a modest recovery with gross domestic product averaging 3.4% this year.  Many of the original numbers regarding exports were modified after Europe’s crisis became clear.  According to the report, it typically takes four to six years to recover from a major restructuring of a local economy, which defines southern California to a certain extent because of the lopsided employment in the housing sector that occurred during the sub-prime boom.  The good news is that California exports and manufacturing will likely pick up the slack and lead California forward. 
 
Even better news for the resale market is that as a result of the worst downturn in decades in new construction, housing demand will fall on existing homes for at least the first two years of the recovery while new housing catches up.