July saw the best increase in nationwide home prices since 2006, suggesting that the housing market may finally be seeing a more permanent recovery. Home prices shot up 3.8% during the month, marking the fifth straight rise in the gauge, according to real estate data provider CoreLogic. California and Orange County are also seeing increased home prices. Orange County’s housing market continues to recover with sale prices up from this time last year. For the 22 business days ending August 15, the median selling price for all residences was up 3.4% from last year and total Orange County sales were up 15.6% from last year. Notably, the mid-county section, often the slowest moving section of Orange County, saw an increase in sales up 8% versus 2011. Housing prices in California rose 4.4% for July.
New housing construction in California contributes over $20.7 billion per year and supports nearly 123,000 jobs statewide on an annual basis, according to a report by the Center for Strategic and Economic Research for the California Homebuilding Foundation. Every dollar spent on new housing generates another $1.20 in total economic activity and each job created supports an additional 1.4 jobs. Current estimates indicate that 2012 impacts could potentially reach over 154,000 jobs and $26 billion of output, up for a low of $13.8 billion and 76,000 jobs in 2009. However, while these numbers are encouraging, new housing remains well below the long-term average as the need for new housing continues to grow. For more information contact Dr. Wallace Walrod, Chief Economic Advisor.