California’s Inland Empire–the region including portions of San Bernardino and Riverside Counties–has become one of the hottest real estate markets in the United States. But just as Inland Empire home prices rise, the region’s job growth has dropped, and some longtime residents are worried they may be priced out by remote workers from Los Angeles and elsewhere who have swooped in during the pandemic.
According to data released this month by housing industry analysts CoreLogic, home sales prices in the Inland Empire rose nearly 12 percent during 2020.
“The continued rise in home prices increases down payment requirements and exacerbates the housing market’s affordability issues, leaving lower-income families in rentals and priced-out of the home-purchase market,” notes a CoreLogic press release accompanying the data.
Rental inventory, too, has significantly tightened up, and prices have risen by 6.9 percent in Riverside County and 9.1 percent in San Bernardino county, the Los Angeles Times reports.
In both cases, a significant amount of interest in the market is coming from people moving into the region from other, more expensive parts of the state.
Realtor.com, a national real estate industry site, reports that the bulk of out-of-market buyers and renters looking for homes in Riverside and the surrounding areas are coming from Los Angeles, followed by Orange County and San Diego. That trend, they say, is linked to the pandemic inspiring a major shift toward long-term work from home.
“With many tech companies extending their work from home policies and employees anticipating that their employers will afford more flexibility for remote working, the potential exists for home shoppers to search farther from home,” a statement notes.
While continuing higher-paying jobs remotely while living in a bigger, less-expensive home farther from the office may seem like an appealing prospect for some, it has some existing residents worried they may be priced out of their neighborhoods.
Local job growth in the Inland Empire dropped by 7 percent in 2020, and unemployment remains over 9 percent. Retail and storefront real estate vacancies jumped 10 percent in just the third quarter of last year, an indicator that shops and restaurants have gone out of business and not been replaced.
“People who have lived in L.A., Orange County and surrounding counties are now fleeing to San Bernardino County, taking the housing that is available to our residents,” Vanessa Perez, director of the Time for Change Foundation, a San Bernardino-based organization that works on issues of housing and homelessness, recently told ABC. “[T]he need is not only long, it’s consistently growing.”
Even before the pandemic, many of the regions jobs are concentrated in warehousing, construction, health care, agriculture, and the hospitality sector. In 2019, the Press-Enterprise reported that average wages in Riverside and San Bernardino counties were at that time not just among the lowest in California, but among the lowest of all urbanized counties in the U.S.
Those economic realities leave many Inland Empire workers vulnerable to even minor fluctuations in housing costs.
“With concerns over rising housing prices in the Inland Empire,” reads a report from the Lowe Institute of Political Economy at Claremont McKenna College, “residents are rightly concerned with gentrification and displacement from their homes due to issues of affordability.”