Big Year Is Seen for Local Economy
Ventura County’s economy will continue to strengthen in 2004, with businesses expanding, retail sales growing and home prices increasing, experts predict in a new report released Thursday.
But while the long-term economic outlook for the county is positive, the lack of affordable housing and needed highway expansion remain major impediments to attracting new business and creating more jobs.
“Overall, the economy should continue to be healthy,” said Mark Schniepp, director of the California Economic Forecast. “But we don’t look for increased job creation in the future, because housing has constrained it so much.”
Low mortgage rates, steady population increases and the influx of people from Santa Barbara and Los Angeles counties helped produce double-digit appreciation in home prices in each of the past four years, said Schniepp, who discussed his forecast during a conference in Westlake Village.
Every measure of housing value suggests fewer working people can afford the average Ventura County residence. The median price of existing homes sold in December was $414,000, according to DataQuick Information Services, which tracks all new and existing home and condominium sales. The California Assn. of Realtors, which only measures existing single-family detached homes sold by professionals, placed the county’s December median price at $488,690.
Prices of new homes were even steeper in late 2003. In Camarillo, the average price of a new home was $875,000, in Thousand Oaks $960,174 and in Moorpark $1,074,000. Even condominium prices countywide jumped 55% last year to $430,242. Price tags, Schniepp said, “have leaped to absurd levels.”
Renters are not expected to see much relief this year either.
Last month, the average monthly rent on a two-bedroom apartment in Ventura County hit a record $1,349 and only 3% of the 18,824 apartment units throughout the county were vacant. More apartments are due for construction in Simi Valley, Oxnard and Moorpark.
Christopher Thornberg, senior economist with the UCLA Anderson Forecast, told the conference audience that consumer spending has buoyed the national economy out of the recession, but that the current level of consumption can’t be maintained and that a downturn could occur in 2005.
Fears of rising interest rates have spurred more people to buy homes, especially in Southern California, to a point “where they’re driving prices out of whack,” he said.
But John E. Anderson, chairman of Los Angeles-based Topa Equities Ltd. and namesake of UCLA’s Anderson business school, was more bullish about local real estate, especially commercial properties.
“I think your prices are low. I got the Oxnard Financial Plaza [in 2002] for $100 per square foot, and it would cost several hundred dollars a foot to duplicate it,” Anderson said after recounting a list of some of his investments in the county, which include a manufacturing company in Oxnard, several office buildings in Thousand Oaks and Silver Star automotive group, a major tenant at the Thousand Oaks Auto Mall.
“I see nothing but up, up, up for Ventura County,” he said.
Schniepp said economic growth would also be hampered by continued delays in the widening of major roadways, including the Ventura Freeway, the Ronald Reagan Freeway through Simi Valley and California 23 in Thousand Oaks.
Last year, 5,808 jobs were lost in the county, and Schniepp predicts from 1,000 to 1,500 fewer jobs in 2004, with the total number of jobs estimated to stay flat at 293,700. The unemployment rate is forecast to remain at 5.4% again in 2004, mainly because the loss of local jobs is expected to be balanced by new residents employed outside the county.
Schniepp expects several major private employers -- Amgen in Newbury Park, mortgage lender Countrywide in Simi Valley, WellPoint Health Networks in Thousand Oaks and Technicolor Video Services in Camarillo -- to continue to hire more workers this year. Growth in these companies should translate into more jobs in retail, wholesale trade, healthcare and private education, he said.
The businesses best poised to grow are “small firms with 10 or 20 workers, where they live in Ventura County or could commute in,” Schniepp said, adding that less exposure to healthcare premiums or worker’s compensation costs allows for faster expansion.
Additionally, the number of self-employed people and independent contractors -- who are not counted in the government’s monthly jobs estimates -- is expected to increase 1.8% this year to 93,800, according to the forecast. Meanwhile, retail sales in the county are expected to rise nearly 4% in 2004 to $7.9 billion and another 6% next year to $8.4 billion, the report said.
