Here's recent history of the Fed’s policy committee and its Fed Funds rate. Next Fed decision is June 24/25.
Long commute? Good-bye O.C.
August 6th, 2008, 12:05 am · 90 Comments · posted by Mary Ann Milbourn
If the folks at RREEF Research are right, O.C. may face an unanticipated challenge in attracting homeowners and tenants in the future: long commutes and lack of public transit.
RREEF, the publishing arm of Institutional Real Estate, Inc., analyzed economic trends over the next five year
s and concluded that high gasoline prices, rising inflation and a declining dollar would lead to major behavioral changes that don’t bode well for suburban parts of O.C. Among the changes:
“Long distance commutes have become costly, particularly for lower and mid-level employees. A short automotive commute, a commute by public transport, and even a walking or bicycling commute has become more appealing. Thus, demand will increase for residential locations with good access to employment centers and will decrease for peripheral suburban bedroom communities that are poorly served by transit.”
Experts already have suggested that a tight rental market in North County may not just be due to cheaper apartments, but may also be evidence of people migrating closer to public transit and jobs in Los Angeles.
Orange County’s more distant communities however, may have bought some time. The study, done in July, anticipated oil staying in the $140 range through the end next year. Oil dropped to $118 Tuesday before inching up to just over $119.
Other real estate news:
- Haggling over broker’s commission does cut fee
- Anaheim condo sale draws a buying crowd
- Downscale ZIPs power mid-July homebuying surge
- Traders bet LA/OC homes will lose another 21%
- Housing investment off $305 billion from ‘06 peak
- Or … check out July’s most sizzlin’ real estate stories!
August 6th, 2008 at 12:28 am
Makes sense. You either have it or you don’t.
August 6th, 2008 at 12:35 am
I venture to say this works in OC’s favor, as I see more commuters going into OC than out. The jobs are here! 20 years ago the 405 going to L.A. was jammed northbound in the morning and southbound in the afternoon. Now that’s reversed.
We’ve been predicting for some time that the gas bumps will delay the recovery in the I.E. and Antelope Valley, and that the OC can expect a turn-around first. (See, for example, “A price bottom for new construction?“).
People want to live closer to their jobs, and there are still lots of jobs throughout the O.C.!
August 6th, 2008 at 1:23 am
The price of gas is cyclical. That they would even try and predict the price of gas in five years proves to me that these folks are not very bright.
Yes, gas is expensive right now. But this type of silly study about how people will live in 2013 would be like someone in 1980 predicting that gas would still be very expensive in 1985.
(And for you young’uns, in 1980 the country was suffering through a second Energy Crisis with very high gas prices, but by 1985 the price of oil and gasoline had collapsed to record lows. I’d bet 20 a full tank of gas the same thing will happen over the next few years.)
Really, I’m surprised the yahoos at RREEF Research are brave enough to attach their names to a worthless and mindless “study” like this.
August 6th, 2008 at 6:38 am
RealtorDaveE Says: “I venture to say this works in OC’s favor, as I see more commuters going into OC than out. The jobs are here! ”
Dave, you don’t know what you are talking about.
I commute to LA every day and the 405 going to LA is jammed in the morning and the afternoon going south.
The good paying jobs are still in LA. Most of the good paying jobs in defense and entertainment are still in LA.
OC only had the mortgage industry jobs and most of those are gone.
August 6th, 2008 at 6:47 am
I agree. Many of the jobs in OC are threatened. Public transit is horrible, but LA isn’t much better. With how much sprawl and commuter traffic there is in LA and OC, we should have much better mass transit. I should be able to get from my HB home to LAX without 3+ transfers and multiple hours. Rather than building a million new roads, we need to focus on mass transit going forward.
http://www.beyondthemargin.net/2008/08/declining-tax-revenues-threaten-us.html
August 6th, 2008 at 7:34 am
Lanser is trying to cut the legs from under the segment of the RE market that is super hot right now. (The cheap lower end condos)But it just won’t work as OC will follow the path of LA as it always has in terms of housing prices. The only difference is the OC is newer and cleaner. Try to tell the people in south OC to move to Compton and Watts to be closer to employment centers ??? Lanser, good try but it won’t fly. Try something else like the option ARMS will be resetting soon or something. But that will not have the result you’re looking for as the people who are causing these multiple offers that you are worried about are investors, not average Joe that posts in here! The price to rent ratio is already around 11 or 12 in some condo communities, that’s back to 2001. Ginnie is coming out of the bottle and soon it will be too late to stop it !!
August 6th, 2008 at 7:38 am
Bubble is right about the mortgage jobs. There were a lot of companies in OC that shut down. How many people alone were at New Century? I believe the initial lay off was about 3000 when I left. They still had a skeleton crew of about 2000 in 2007 to mop up. This is one company. My wife and I still live near work, but it took her 8 months to find a local job after leaving loan processing.
August 6th, 2008 at 7:48 am
OC has a diverse and still-vibrant job market. And last week I saw traffic coming into OC that was bumper to bumper with only a drip going out. We will benefit greatly from this type of change. And then there’s always the possibility of better (yes, we have some) mass transit and far more efficient autos. OC has the best of everything, its future is undeniably bright.
August 6th, 2008 at 8:03 am
The OC does have the best of everything or I wouldn’t be living here and hopefully they make better mass transit but for now we all know half the poeple in OC won’t get their mail without jumping in the car.
I still see a lot of people commuting to Irvine but South OC might be effected, especially the far out places that are 20 minutes from the freeway, Rancho, Talega and Coto ect.. I guess we will have to see.
August 6th, 2008 at 8:03 am
The OC does have the best of everything or I wouldn’t be living here and hopefully they make better mass transit but for now we all know half the poeple in OC won’t get their mail without jumping in the car.
I still see a lot of people commuting to Irvine but South OC might be effected, especially the far out places that are 20 minutes from the freeway, Rancho, Talega and Coto ect.. I guess we will have to see.
August 6th, 2008 at 8:05 am
Wow! How did that happen. Must be stu…stu..stu…stuttering!
August 6th, 2008 at 8:17 am
No problem…you can have LA.
August 6th, 2008 at 8:32 am
duh… a lot of us have been saying this via OCR. OC’s transportation sucks. no light rail? no express busses? no surprise it’s just finally starting to bite the county in the rear
August 6th, 2008 at 8:36 am
re: provider and bubble on jobs, LA > OC > Riverside. that’s why the influx on the 91W and 55 and outflow everywhere else. bubble is mostly right while provider is still in denial of course.
the people who live in south county that don’t work from home either drive to Irvine / Mission Viejo / Newport, with the few that commute to San Diego.
August 6th, 2008 at 8:40 am
The reason we don’t have mass transit is because everytime it is proposed people cry NIMBY! Everyone wants is as long as it doesn’t run near their home or neighborhood. We will never have better transportation because of this.Look what happened with the light rail that was proposed several years ago. Most city councils voted not to have it in their city. By the time it was all said and done, there was a proposal for a train to go nowhere. BIG MISTAKE!
I think it would have improved housing values in the areas that have access to public transit but others thought I was wrong.
August 6th, 2008 at 8:45 am
You areed with me, yet I am in denial? Allrighty. You folks have NO integrity. You attack the messenger even when the message is correct. Lame. I expect nothing less. What IS the lead time on ordering some buses anyway, 20 years?
August 6th, 2008 at 8:47 am
Newsflash: we have trains!
August 6th, 2008 at 8:51 am
Ok Provider, tell me what the best route via train or bus to get from Ladera Ranch to Long Beach. Go look that up.
August 6th, 2008 at 8:57 am
These stats don’t really mean much. Behaviors can and will change. The price of gas has already come down because of less demand. I have already taken the bus at least once a week from Aliso to Costa Mesa. Sure its a little sacrifice but not too bad. I even walk a little more. Just by easing up on the gas pedal makes a huge difference. I think even 4 day work weeks will be possible in the future. More fuel efficient cars will be made in the next few years. We will adjust to the high prices of gas.
August 6th, 2008 at 8:59 am
While that commute is stupid, it is certainly doable. You could probably do it in the time it takes to go from 96th Street in Manhattan down to Battery Park.
August 6th, 2008 at 9:01 am
Ok, how about from Ladera to Santa Ana?
August 6th, 2008 at 9:05 am
Yeah just speaking for my self. We live in Capo Beach and I work in San Clemente and my wife in Mission Viejo. Nice commute for both of us. We live right in between. I breeze to work with no traffic at all and we still spend about $250-$300 in gas a month. When I worked in Irvine add another $150 a month. We both drive good gas mileage cars.
I don’t know how many people use the train stop in San Clemente and I am not sure what stops there are in OC. The parking lot isn’t very big so it can’t be that many people.
August 6th, 2008 at 9:06 am
You take the Metro Link from the Crown Valley/Forbes Rd station to the Norwalk station at Civc Center, then take the Metro Blue Line south to Long Beach.
August 6th, 2008 at 9:08 am
Take Metro Link from Crown Valley to Santa Ana station on Santa Ana Blvd at Grand
August 6th, 2008 at 9:08 am
Tell me which trains or buses should I take from Ladera Ranch??
Oh that’s right there are none from Ladera. And just try taking a bus from Rancho to Santa Ana. You better plan on a 2 hour commute. Our public transit sucks even within our county. Forget trying to leave the county.
August 6th, 2008 at 9:09 am
I take that back. It’s doable, but would take a couple of hours. That’s by bus alone. Alfalfa’s option sounds viable.
August 6th, 2008 at 9:11 am
Provider says “we have trains”
So if I live in Ladera Ranch, I drive my car down to the San Juan station, catch a train up to anaheim, and then what? Suit up for the Angels? How do I get to my office in Irvine or Santa Ana? In order for the trains to work as a mode of commuting within OC, you need to have lines that run off the main station to the work centers.
In your case I guess the commute is easy, when you are a realtor in the worst real estate market in history, just go from the bed to the couch in your 800 sq. ft. (I’m gorgeous inside) condo.
August 6th, 2008 at 9:13 am
“Oh that’s right there are none from Ladera.”
On the east coast, people drive to train stations. Very few people have them at their doorstep.
August 6th, 2008 at 9:15 am
http://www.youtube.com/watch?v=b5hKhZKSYw8
This reminds me of realtor dave along with so many others.
August 6th, 2008 at 9:17 am
You can take a bike on the Metro and the buses. My Son in Law commuted that way from Ladera Ranch to Glendale for a couple of years until his company decided to move to Irvine.
August 6th, 2008 at 9:18 am
Realtor Dave has deals in escrow, like many others. Bets on his earnings in August?
August 6th, 2008 at 9:30 am
So I walk from deep in Ladera all the way to Crown Valley and Forbes. Ok so add another 45 minutes to the commute.
August 6th, 2008 at 9:36 am
Whats a matter? You can’t afford a bike to ride to the station?
August 6th, 2008 at 9:40 am
‘On the east coast, people drive to train stations. Very few people have them at their doorstep.”
You missed the point. People drive to the train station there because the trains on the east coast then take them directly to the job centers. Our trains don’t do that unless you work across the street from the Irvine train station (not close enough to the Spectrum) or at Angel stadium.
Public transit is not viable when it doesn’t take you to where you need to go. You might as well drive.
August 6th, 2008 at 9:45 am
provider,
Unfortunately, money’s a drug. Never enough.
Bubble,
I agree that OC needs better public transit, as does all of So Cal. But we sure don’t want something that requires the huge taxpayer subsidies of BART–something like a buck per commuter mile last time I heard (disclaimer: no time to research, that could be different by now).
Sorry about that commute. I have a hard time with it once a month just going from Los Al to LAX. I hate to admit it, but maybe you’re a better man than I.
That 405 north from Long Beach is tough in the morning, no question. But what I’m talking about is between the LA/OC line and John Wayne traffic usually moves far better northbound than southbound in the morning, and reverses in the afternoon. I remember several decades ago ago when the opposite was true, and OC was primarily a bedroom community for commuters who couldn’t afford to live closer in. Now there are tons of jobs here.
Last Sunday at a Los Alamitos open house I had a couple different visitors who wanted to move in from the I.E. I can’t remember ever having an OC homeowner call me who wanted to move closer to L.A. Not saying it doesn’t ever happen, just saying I think Mary Ann got the impact of high gas on OC real estate exactly backwards.
August 6th, 2008 at 9:46 am
I agree with you on 91 from Riverside, but point is the number commuting from OC to LA is just as high. “we have trains!” is a disingenous statement. there is no light rail in OC, while LA etc are at least trying to do that to offset cars. they need to start this by extending the 57 to the 405 as a light-rail-only overhead line. then eliminate one lane on the 22 and build a light rail down the middle to Long Beach. etc etc etc. voters need to withhold any future Measure M funds until they do something useful with them
oh ya and a Monorail all around Anaheim, from the parks to convention center and hotels, to garden walk, angel stadium metrolink station wouldn’t hurt
August 6th, 2008 at 9:56 am
Yeah, that’s what happens when folks go nimby over things like Power plants and airports. It’s impossible to create jobs if there is nowhere to work, instead we have greedy development inundating us with Red roofs.
August 6th, 2008 at 10:20 am
Way off topic, but if you have not already read the news on Fredie-
http://www.forbes.com/2008/08/06/freddie-mac-housing-markets-equity-cx_cg_0806markets08.html?feed=rss_news
August 6th, 2008 at 10:42 am
Melody,
Great you tube video……………my guess is that it presents a more realistic view of what is going on in the homes of real estate professionals than we might realize. Everyone that I ever knew that worked in the real estate bizz lived at the edge of financial reality, and when things turn down they deny the situation, but in the back room they are desperate.
I will sell this house today
I will sell this house today
I will sell this house today
I will sell this house today
August 6th, 2008 at 10:44 am
provider Says:
August 6th, 2008 at 9:18 am
Realtor Dave has deals in escrow, like many others. Bets on his earnings in August?
LOL, good luck with funding . . .
Also, people boasting on the internet about having deals in escrow = not really having deals in escrow.
August 6th, 2008 at 10:49 am
I don’t how many of you know this but the company that built the Disneyland Mono Rail offered to build a system that would connect the Hotels, the Convention Center, the Stadium and Disneyland, but the City of Anaheim turned it down
August 6th, 2008 at 11:04 am
I always laugh when I see the empty busses with the “america’s best” medal on it. Public transportation in Orange County is terrible they have flushed billions of dollars into a broken freeway system. Along a smaller dedicated above grade transportation corridor a lot more commuters can be served. OCTA flushes our money down the toilet and expands freeways that are jampacked….lets start building transportation alternatives. Orange County has as many people as San Diego County and is the 2nd densest county in California, yet we have the worst public transportation in the nation. Busses don’t cut the mustard anymore. The Taxpayers will get shafted once again, since it will take billions of dollars to put fixed guideway transit.
August 6th, 2008 at 11:05 am
Provider: “You could probably do it in the time it takes to go from 96th Street in Manhattan down to Battery Park.”
Now, you have repeatedly been pulling crap out of your arse for what appears to be the last two weeks. I obviously have 1/10 the free time you do - I guess the difference is that I run a corporation and you, well, don’t do much at all.
back to topic: I took the train from white plains (the Bronx) to JFK many times back in the late 80’s and early 90’s - that drive to Long Beach can easily take 1.5 hours on a heavy day. the train ride from Poughkeepsie to JFK can be done in just about 2 hours. The difference in distance? you can figure that one out.
man - your facts are a friggin joke. Not to mention your reading skills - when have I ever stated that anyone using an ARM is irresponsible you dimwit turd!!!?
I have specifically stated a first time buyer using an ARM to simply be able to afford the monthly payment, when fixed rates are at their lowest, and 80% of the buying population (locally) is using ARM’s, and after the biggest run-up in RE appreciation in history was absolutely stupid and irresponsible. By the way - I used ARM’s many times over - great for generating cash flow on the rental properties - especially when fixed rates are higher. Too bad I would not consider using one on a primary home when short term rates are poised to be inched higher in the near future AND IF I COULD NOT AFFORD THE FULLY AMORTIZED PAYMENT!!! Does that come naturally are you really that stupid? Sorry to tell you but 80% of a buying population does NOT use ARM’s when fixed rates are their lowest if affordability is not the issue. You actually believe that most were out for cash flow/investment funds or planned on living there short term? You obviously feel very comfortable throwing around lies. That 80% was quoted several times by many sources - go check it out. Also - I dare you to check out how many buyers used zero down loans in OC as percentage of all loans made in 2004 thru 2006. Go ahead.
When was the last time you were in NYC? I was there 6 weeks ago scoping out more investment properties. Renting a one-car garage there is what it costs to rent a SFR here. HUGE difference!!
Why is it that simple logic seems to be very difficult for you to leverage?
And you have an opinion on an entire market that can be formulated from hearing a single experience of one person. You have the backbone of a worm. You watch traffic one day - and man - the job market must be amazing!!! Your posts are absolutely laughable.
You have any idea how many folks travel into Manhattan come Monday morning? Here’s a hint: more than the population of OC several times over. And how does the footprint of Manhattan compare to the OC? Yeah - I thought so.
the efficiency of the NYC transit system is light-years from our entire transportation system here in SoCal. I dare you to sell your car and try to live a quality life here. In NYC, its as easy as walking to the nearest corner.
August 6th, 2008 at 11:11 am
$1,545,000 ORA 055 Roadway repair
$1,508,000 ORA 005 Roadway improvement
$15,635,000 ORA 005 Bridge repair
$22,071,000 ORA 405 Roadway repair
$3,978,000 ORA 000 Congestion relief
$920,000 ORA 001 Roadway improvement
$16,207,000 ORA 005 Roadway repair
$7,794,000 ORA 405 Roadway improvement
$1,655,000 ORA 057 Roadway improvement
$10,506,000 ORA 055 Roadway repair
$1,268,000 ORA 005 Roadway improvement
$1,500,000 ORA 091 Bridge maintenance
$1,887,000 ORA 241 Roadway improvement
2006-2007 Caltrans plans to spend in OC.
August 6th, 2008 at 11:13 am
Notice the freeways and highways are listed.
August 6th, 2008 at 11:27 am
Public transportation in Orange County exists to get house cleaners, maids, and nanny’s to their jobs in people’s homes.
August 6th, 2008 at 11:47 am
# provider Says:
“While that commute is stupid, it is certainly doable. You could probably do it in the time it takes to go from 96th Street in Manhattan down to Battery Park.”
—
Hey Provider of Misinformation,
Eastside? Take line 5. Off @ Bowling Green. 25 minutes - or less.
Why do you persist in spouting misinformation?
August 6th, 2008 at 11:50 am
Make that line 6.
August 6th, 2008 at 12:03 pm
A few things.
First, I have been saying this here for awhile now. As time goes on the price of gas will continue to rise. Of course it will have fluctuations, but it will continue to rise faster than inflation. You argue about what happen in the 70’s/80’s, but oil is a finite resource and India and China werent driving as much as they are today. Those two countries alone are expected to have something like 500 Million cars on the road by 2020.
So if you think gas isnt going to matter you are fooling yourself. Now of course more fuel efficient vehicles or even ones that require no gas will come on line. That doesnt diminish the fact that they freeways are crowded with more and more people.
That being said, we are going to see more and more “new urbanist” type communities like the SoCo walk in Fullerton, or the Garden Walk in Anaheim and yes even the Stadium lofts. People will want and need to live, work and shop in close proximity. People want to ditch their cars, or least use them less and less.
Many of the far flung suburbs will become less desirable….I know that is hard to swallow and most will disagree, but dont be surprised when it happens.
One of the main points of this article is that the middle and lower class folks of our communities are the ones that are struggling. They need to find places to live that are very close to where they work..
If they cant find an affordable place to live they will move to where they can afford. This means stores/restaurants/hotels/gas stations/etc…in the far flung parts of Orange County will suffer the most due to the inability to attract employees.
Many cities have resisted the construction of any type of affordable housing or even semi-affordable apartments.
I know many of you out there find this shocking and impossible, but we dont live in a bubble. Our society relies heavily on the middle and lower class to survive, they are the oil in the machine that keeps things moving.
You will see more and more buildings going higher and higher. More mass transit being created and a lessening desire on living 20 minutes from everything.
August 6th, 2008 at 12:11 pm
PDU don’t botther Provider just wants to cause drama by saying completly rediculous statements. she is still going on about the fully indexed rate thing on that other article. I think we are up to 172 posts and it is all her and me posting.
August 6th, 2008 at 12:36 pm
NBI, you’re a filthy-mouthed loser. You’re not the only person from New York, you arse. It can take an hour to travel through Manhattan, including the little hike to get to your local station. STFU.
August 6th, 2008 at 12:37 pm
You’re a clown, stash.
August 6th, 2008 at 12:37 pm
Just ask NBI!
August 6th, 2008 at 12:45 pm
“In NYC, its as easy as walking to the nearest corner.’
Bullsh!t. It’s easy, but can be one helluva walk.
August 6th, 2008 at 12:48 pm
Name calling…. Very intelligent….
I thought I told you when you called me smarty pants that I prefer you call me doo doo head.
By they way I am a clown………..
Who wants balloon animals?
NBI and I differ on sales but that based solely on opinion. You try and dispute facts. I respect his opinions but I may not agree with them. I think he would back me on that.
August 6th, 2008 at 12:51 pm
The emotional level on this blog seems to be escalating to new levels every day – everyone is an expert and the other guy is always an idiot.
The big question today is will increase fuel costs have a significant “long-term” impact on RE prices in So. OC? I think to answer we need to look at comparable countries/areas that have even higher fuel prices – e.g., the UK. RE prices in the suburbs of London is out of sight even though people have to pay more for fuel and they have to pay what we would call out astronomical fees/taxes just to be able to drive their cars into London – and the motorways are basically parking lots during rush hour. I know this because I lived there for 2-years during grad-school.
So at the risk of causing someone a heart attack, I have to say that $4/gal is not going to be a big factor in the OC housing market and I find it hard to believe that gas will get over $5/gal before alternative modes of personal transportation are available – you can already buy a CNG car from Honda, gets the equivalent of 33 mpg and you can fill it up for the equivalent of $1.10/gal in your garage – or go buy one of their 600 cc scooters that get 60-70 mpg (these are all the rage in Europe, but the main player there is more Piaggio).
Just a quick closing comment being a NJ native – under 2-hours Poughkeepsie to JFK – maybe if you start the clock at the station in Poughkeepsie (not at your front door) and stop it when you catch the transfer to the airport (from say Jamaica station) – otherwise I would estimate the trip at 2.5 minimum.
August 6th, 2008 at 12:56 pm
Oh yeah, heaven help you if need need to go crosstown.
Stop the stalking stash, you’re acting like a freak.
August 6th, 2008 at 12:58 pm
“Name calling…. Very intelligent….”
Go read this thread and tell me whether NBI called me a slew of nasty names first. Do you have the spine to do this?
August 6th, 2008 at 1:04 pm
How can you stalk someone on a blog? Are you going to get a restraining order to stop my fingers from coming with in 3 feet of the key board?
Again I am freak………..You got me pegged!
I thought this was an RE blog not a name calling contest.
I can do this on some aol chat room.
Wow! He did it first…………..
I am not your daddy or your teacher. Save it.
August 6th, 2008 at 1:07 pm
No, you’re a person who can’t win an argument on merit. You have to try and round up your bully friends because they can be counted on to back you even though you have already lost.
August 6th, 2008 at 1:08 pm
This is pointless……….. I am done for now…………..click
August 6th, 2008 at 1:17 pm
Stash, don’t let Provider get to you. He obviously was just recently laid off and that’s why he is on this blog CONSTANTLY!
August 6th, 2008 at 1:43 pm
This place has gotten odd. We rarely discuss the topic at hand, people put up ideas or opinions, than others just come in and bad mouth each other jsut because.
Im not trying to convince a soul, but you can have a civil discussion and voice your opinions or at least you should be able to.
It does start to get boring.
August 6th, 2008 at 1:44 pm
I was just in NYC and I took the N at 49th to Court St. in Brooklyn, and it took about 15-20 minutes. You could go from 96th to Battery Park, back to 96th, back to Battery Park, and back to 96th on the express trains and it wouldn’t take an hour and half. A couple of trips ago I took the train from Grand Central to Poughkeepsie and it took an hour and half.
Were you on drugs when you were there? Because that might explain the extreme loss of sense of ti