Understanding of the housing crisis won’t come without a thorough study of the economy -- and that’s just what members of the North San Diego County Association of Realtors were doing Friday.
At the annual Conversations ’08 meeting at California State University San Marcos, eight panelists spoke about the housing industry’s relationship to water and energy use, transportation, planning and current events.
The realtors, brokers and other members of the industry portrayed an optimistic outlook -- with interest rates low and home prices dropping, many are hoping that people look at this as a good time to buy in North County.
In order to attract new residents, however, the infrastructure must be in place. San Diego Association of Governments chief economist Marney Cox spoke about transportation and plans to cut commute times with an expansion of the carpool lanes from eight miles to 100 miles during the next 20 years.
The realtors look at this as a positive, since Ivan Holler, director of planning for the Rancho Santa Fe Association, said that people are moving closer to work, or working closer to home -- wanting shorter commutes and communities with amenities in walking distance.
Holler created a stir when he spoke of his view of public transportation.
“I’m not a big fan of public transit in North County, unless we provide the density,” he said, noting that unlike many counties, San Diego has several employment centers -- downtown, Sorrento Valley, Clairemont, etc. and it is hard to provide public transportation that works for all commuters.
He said the money may be better spent on roads.
Energy and water conservation, however, is certainly on the minds of service providers. San Diego Gas & Electric COO Michael Niggli said that San Diego needs another transmission station and more green energy sources in order to reduce the amount of greenhouse gas emissions to 1990 levels by 2020, required by California Law AB 32, signed by Gov. Schwarzenegger in 2006. The utility already has 41 programs for conservation and uses wind and geothermal energy.
The San Diego County Water Authority is trying to get a more diversified portfolio to continue to bring water to San Diego.
“It’s only through the diversification of our supplies and facilities that we will make it,” said Maureen Stapleton, general manager of the San Diego County Water Authority.
The Water Authority has struggled through recent dry years -- Stapleton said 2006 and 2007 were the driest California has had since 1801 -- but is hoping that by storing water and importing from more places, the county will be able to handle dry years.
“A water crisis will turn an economy down faster than anything you’ve seen,” Stapleton said, telling the realtors why they should lobby for more water sources.
Some worried that environmentalists were controlling the economy, and consequentially the housing industry, by being overly influential on government funds. Michael Pattinson, CEO of Barratt-American, said in order to build a development of 200 homes on 2,600 acres in Santee, in addition to paying the impact fees, he had to build traffic signals, a community center, a fire station -- and pay to have it staffed.
“They certainly don’t want me to build another house ever again,” he joked, saying he hated dealing with the policies and regulations that were meant to preserve the environment and improve infrastructure but seemed unfair.
He compared it with bookstores having to donate to the school district, or a car dealership having to help supply a police station.
“I believe it is an essential failure of leadership,” Stapleton said of the regulations and lack of prioritization. “It is not Democratic, it is not Republican; it is an essential failure.”
There is good news however. Niggli said California is the most energy efficient state in the union. While a half-million people have been added to the county’s population since 1992, the county’s energy use has stayed the same.
Cox said that energy policies and business regulations will define the standard of life for residents -- meaning whether or not they can afford a home.
The gap between low income and high-income jobs is widening -- and economist Robert Brown said it distorts home statistics.
“The median price is really not the message of what’s going on,” he said, noting that while the median home price went up last year, there are significantly fewer homes being sold that are priced between $400,000 and $900,000.
Real estate economist John Tuccillo facilitated the discussion. He asked those in attendance at the seminar whether they saw the news of a housing slowdown as good news or bad news. They raised their hands with enthusiastic optimism that 2008 will be a good year due to low interest rates, falling housing prices and a large inventory for buyers to choose from.