| | | | EAST BAY NOVEMBER 2006 MONTHLY ANALYSIS | | The East Bay Monthly Analysis augments the East Bay Quarterly Forecast authored by the UCLA Anderson Forecast. A free subscription and downloads of both monthly and quarterly reports are available at www.edab.org/newsletter.html. East Bay EDA welcomes your comments and suggestions. Send your comments, questions or suggestions to stephanie@eastbayeda.org or call us at (510) 272-6843. For a more printable (PDF) version of this newsletter, click here. SNAPSHOT: THE EAST BAY IN OCTOBER 2006  | The East Bay unemployment rate was 3.9% in October, down from 4.2% in September | | October was the East Bay’s 29th consecutive month of year-over-year gains in payroll employment | | East Bay home sales were up compared to September, but were down from October one year ago | | Foreclosure rates in both East Bay counties were up from the previous quarter | | East Bay multi-family permits increased in a year-over-year comparison, while single family permits decreased | | Average asking rents for East Bay commercial property were stable, but vacancy rates were up from the previous quarter | | East Bay hotels enjoyed increases in both occupancy and daily room rates |
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 2.2 percent in the third quarter of 2006, according to preliminary estimates released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 2.6 percent. The increase in real GDP in the third quarter primarily reflected positive contributions from personal consumption expenditures – such as expenditures by individuals on durables, non-durables and services; exports, equipment and software – such as new machinery, equipment, furniture, vehicles, etc.; nonresidential structures – such as new construction, improvements to existing structures, as well as equipment like plumbing and heating, which are an integral part of a structure; and state and local government spending. These contributions were partly offset by a negative contribution from residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased. (Click here for more on GDP and Corporate Profits). In October, the Bay Area Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent, and shelter costs were up 1.0 percent - making last month the 17th straight month of increases in the Bay Area’s CPI-U, and the 7th straight month of increases in Bay Area shelter costs, according to the Bureau of Labor Statistics. 
(Click here for more on CPI). The unemployment rate in the Oakland-Fremont-Hayward Metropolitan District was 3.9 percent in October 2006, down from 4.2 percent in September 2006, and below the year-ago estimate of 4.8 percent. This is considerably lower than the unadjusted unemployment rate of 4.2 percent for California and 4.1 percent for the nation in October 2006. Within the East Bay, Alameda County’s unemployment rate was 4.0 percent in October 2006, down from 4.3 percent in September, and Contra Costa County’s rate was 3.8 percent, down from 4.0 percent in September. 
(Click here for more on Bay Area Workforce, Employed Residents & Payroll). Between September and October of 2006, East Bay payroll employment gained 3,100 non-farm jobs, continuing to grow following a gain of 6,500 in September. During the same period, San Francisco lost 400 jobs and San Jose gained 4,600 jobs. In the East Bay: | Government posted a net gain of 3,200 jobs, mainly due to a seasonal addition in local public schools (up 2,300 jobs). | | Educational and health services gained 1,100 jobs, partly from a seasonal increase in private schools (up 500 jobs). | | Trade, transportation and utilities picked up 800 jobs. | | Leisure and hospitality lost 1,000 jobs, predominately in accommodation and food services (down 700 jobs). | | Manufacturing was down 300 jobs, with losses occurring in residual-food manufacturing (down 200 jobs) and computer and peripheral equipment manufacturing (down 100 jobs) |
(Click here for more on East Bay Payroll Employment by Sector). HOUSINGBay Area home sales held steady at a five-year low in October 2006 as buyers and sellers circled each other in a game of wait-and-see. Prices remained flat, according to DataQuick Information Systems. A total of 7,979 new and resale houses and condos were sold in the nine-county region in October. That was up 0.9 percent from 7,907 for the month before, and down 24.1 percent from 10,508 for October last year. Last month's sales count was the lowest for any October since 2001 when 7,867 homes were sold. An average October has 8,445 sales in DataQuick's statistics, which go back to 1988. The range is from 5,767 in 1994 to 11,728 in 2003. All Homes by County | Number Sold
October 2006 | Annual Pct.
Chg | Median
October 2006 | Median Annual Pct.
Chg | Alameda | 1,586 | -27.5% | $578,000 | 1.2% | Contra Costa | 1,658 | -21.2% | $544,000 | -5.4% | Marin | 286 | -27.6% | $844,000 | 3.3% | Napa | 140 | -25.1% | $555,000 | -8.7% | San Francisco | 523 | -13.6% | $771,000 | -0.9% | San Mateo | 653 | -13.4% | $745,000 | -1.8% | Santa Clara | 1,971 | -22.9% | $658,000 | 3.0% | Solano | 605 | -35.4% | $462,000 | -2.9% | Sonoma | 557 | -28.9% | $531,000 | -5.9% | Bay Area | 7,979 | -24.1% | $614,000 | 0.0% | Source: Data Quick Information Systems |
In October 2006 over $271 million in residential permits were issued in the East Bay, up from $198 million in September. The cities of Oakland and Walnut Creek issued 134 and 125 multi-family construction permits, respectively – raising the overall dollar value of permits issued in the East Bay in October. Non-residential permits reached an incredible $445 million in the San Francisco region- over $100 million more than San Francisco’s last monthly high of $348 million in December 2002. The $210 million in non-residential permits issued in the San Jose region was the highest since October 2001. In the East Bay, last month’s $92 million was down from $95 million in September, but marked the highest October since 2002. Region | Total Permit Change 10/05 vs. 10/06 | Percent Change | East Bay | -$61,273,915 | -1.4% | Napa | -$93,731,434 | -26.1% | San Francisco | $852,264,338 | 28.4% | San Jose | $347,329,190 | 12.3% | Vallejo Fairfield | -$423,384,048 | -23.7% |
(Click here for more on Construction Permits). COMMERCIAL REAL ESTATE In the third quarter of 2006, office vacancy rates were up from the second quarter in most East Bay sub-markets. The East Bay’s industrial market also saw increases in vacancy rates between the second and third quarters of 2006, however some sub-markets saw significant decreases, such as Hayward, Dublin and Pleasanton. (Click here for more on Commercial Real Estate). The PKF Consulting report on hotel trends for September 2006 shows a 6.5 percent increase in room rates in throughout Northern California. The East Bay’s average daily room rate of $107.48 in September was 1.6 percent higher than in September 2005. Hotels in the Napa, San Jose/Peninsula, Sonoma and Central Valley areas all saw year-over-year increases in daily room rates. (Click here for more on Hotel Occupancy). | | 
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