A comeback year, with some caveats.
2005 is expected to be the best year since 2000 for some sectors of Orange County’s economy, namely tourism and exports. And technology and healthcare should have good years, if not record-setting ones.
Even manufacturing, among the hardest hit in the downturn of a few years ago, is set to continue a rebound that started in 2003. But it could be a ways off before the county’s factories return to 2000 levels, if ever.
All eyes will be on the housing market, which is in the late stages of a multiyear tear. Economists predict a fall in home prices of anywhere from 7% to 20%. As it is, sales are slowing, but prices are holding steady, near record levels.
Crosscurrents stand to play out in housing next year. Sky-high prices could cause some buyers to balk. But job growth is seen at about 1.4%, or 21,000 workers. That’s a modest gain, to be sure, but not enough to bode a dramatic downturn in housing demand.
Then there are interest rates. They’re set to rise more next year. But, so far, after five Federal Reserve hikes this year, mortgages remain dirt cheap.
The outlook for real estate’s other half,office buildings and other commercial space,is clearer. Look for less space on the market, higher rents and even development, the scope of which we haven’t seen for years.
In our annual forecast issue, we take ya look at what to expect in the coming year, starting with technology on page 3.
