Real estate guru: Local housing market stable

By: BRADLEY J. FIKES - Staff Writer | Wednesday, September 14, 2005 9:10 PM PDT ∞

LA JOLLA ---- Waiting for San Diego County's supposed housing bubble to burst? You will wait forever, said Alan Nevin, a longtime local real estate specialist.

The double-digit annual increases in home prices of recent years dropped last summer to about 5 percent to 7 percent a year. That transition eased what had been an unsustainable spiral down to a normal market that can go on indefinitely.

"And everybody missed it," said Nevin, director of research at San Diego's MarketPointe Realty Advisors. "People are just starting to recognize it now."

Nevin spoke Wednesday morning to about 50 people at a series sponsored by Southwest Community Bancorp, the Carlsbad-based parent of Southwest Community Bank. Money raised from the event at the La Jolla Radisson went to the Alpha Project for the Homeless.

From Oceanside to downtown San Diego, the economy is so well diversified it is nearly invulnerable to collapse, Nevin said. That diversification and the stabilized real estate market makes prospects for the region almost scarily good.

"The economy is basically healthy. There don't seem to be any weak spots," Nevin said in after-talk remarks. "Right now, there's no one employer that has more than half of 1 percent of the jobs in the county."

Nevin sketched a portrait of a county bringing in new housing and renovating old and even dangerous neighborhoods, a county possibly on the way to becoming an internationally favored place to live by the well-to-do ---- bringing in yet another source of wealth to sustain the real estate market.

About the only people left out of the picture are low-income residents, Nevin said, because cities don't allow enough apartment construction for them. Cities have plenty of property that could be sold off for apartment construction, he said, but they don't because voters oppose it.

Asked where he would recommend buying real estate in the North County coastal area, Nevin replied: "Everywhere. There's no negatives."

Nevin said he was surprised at the economy's continued strength, since the region has experienced nearly a decade of continuous growth. The early years of the 1970s, '80s and '90s were all rough for San Diego, Nevin said, but that hasn't happened in the first part of this decade.

Much of Nevin's talk focused on downtown San Diego. With its juxtaposition of high-rise condos and entertainment, that area has become increasingly fashionable. Nevin said that style of living fits San Diego County, which is increasingly becoming a society of singles and childless families.

Oceanside will increasingly come to resemble downtown San Diego's high-density, high-rise profile as its redevelopment goes forward, Nevin said.

"It hasn't been terribly successful to date with multifamily," Nevin said. "But the single-family (homes) on the north end have been unbelievably successful."

That high-rise transformation could also be sustained in Leucadia, Solana Beach or Encinitas, Nevin said, but the governments there won't let it happen.

Nevin's talk was reassuring, said Frank Mercardante, Southwest president and chief executive.

"He emphasized there is no bubble and there won't be, because of the demand for real estate here in San Diego County," Mercardante said.

Mercardante said that as a banker, he has to think of problems that would keep him up at night, and asked Nevin what would keep him up at night about the economy.

"He said, 'Nothing,' " Mercardante said.

Contact staff writer Bradley J. Fikes at (760) 739-6641 or bfikes@nctimes.com.

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