Continued High Costs May Slow the Market for Houses This Year
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The likelihood of record Orange County home prices continuing this year could finally cool the market, in part, because too many people simply can’t afford the high prices, a Chapman University professor said.
Besides, county builders are turning more toward construction of much-needed multifamily units, which also are commanding record rents, typically $1,100 or more.
County building permits for multifamily construction through the first 11 months of 2000 ran about 25% ahead of the previous year, while permits for single-family homes fell 12%.
But keeping up with the overall housing need still will be a challenge, said Esmael Adibi, a Chapman economist.
Chapman forecasters predict 3.5% job growth in Orange County, or 48,000 jobs this year, creating more housing demand. Adibi predicts that final numbers will show the county issuing 12,500 housing permits in 2000 and that the county will issue 13,700 permits this year.
“We weren’t building enough to meet demand,” Adibi said. If new construction falls short of these home-permit predictions, “It will place even more upward pressure on home prices,” he said.
Daryl Strickland covers real estate for The Times. He can be reached at (714) 966-5670 and at [email protected].
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