More positive signs for California economy

With September's employment numbers coming out Friday, we'll see whether the national drop in the jobless rate will be carried over to the state and county level (the pattern is spotty). But it's hard to deny that things are getting better, as I pointed out in this week's Business Update on KPCC:

Lacter: Don't say it too loudly. You certainly notice it with Southern California home prices, which shot up 12.5 percent in September compared with a year earlier - and perhaps more importantly, the number of homes that sold between $300,000 and $800,000 rose 11.5 percent. That category had been going nowhere for the longest time because homeowners didn't want to put their properties on the market when prices were so depressed. Actually, inventory remains quite low (I saw a home over the weekend in my neighborhood that they're expecting to sell for $100,000 above the asking price, and you're seeing that a lot). So, you match this limited inventory with record-low mortgage rates and also pent-up demand among first-time buyers.

Steve Julian: But the housing market isn't anywhere near "normal" right?

Lacter: That's right. The California Association of Realtors only expects a 6 percent increase in median prices next year, which would still put it way below the peak of more than $560,000 in 2007 (seems like a long time ago). And, all this assumes that the overall economy does not suffer some unanticipated blow, such as an impasse in Congress over spending levels, a huge drop in the stock market, a collapse of the euro - there are lots scary scenarios. Having said all that, the positive numbers are becoming harder to ignore.

Julian: Plus, consumers are spending more.

Lacter: You know, Bill Maher was joking the other day about how all the shopping malls are jammed, and the thing is he's right. Taxable sales in California have increased for 12 straight quarters, and they're expected to get back to the pre-recession levels by the end of this year. Nationally, we saw that retail sales rose pretty sharply in September and the August numbers were revised higher.