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HOUSING MARKET PROJECTED TO CONTRIBUTE MORE THAN $21 BILLION TO CALIFORNIA'S ECONOMY IN 1992

 HOUSING MARKET PROJECTED TO CONTRIBUTE MORE THAN $21 BILLION
 TO CALIFORNIA'S ECONOMY IN 1992
 Residential Real Estate Recovery Expected to Boost State's Economy
 LOS ANGELES, April 8 /PRNewswire/ -- California's housing market is expected to contribute an estimated $21.3 billion worth of goods and services to the state's economy in 1992, up 15.8 percent from $18.4 billion last year, according to analysis conducted by the California Association of Realtors (C.A.R.).
 "These figures illustrate the tremendous contribution that the housing market makes to the overall California economy," said C.A.R. President Chuck Lamb. "It's encouraging that this year's projected recovery in the housing industry is expected to give an additional $2.9 billion boost to the state's economy, compared with last year," said Lamb, a San Fernando Valley realtor.
 "We've already experienced four consecutive months of sales increases in California's existing, detached housing market, and we expect that recovery to continue throughout 1992," said Lamb. "Historically, the housing industry has led the economy out of recessions in previous years, and all signs indicate that this trend will continue in 1992," Lamb said.
 The analysis conducted by C.A.R.'s Research and Economics Department also shows the impact that the housing industry had on California's economy during recovery from the recession in the early 1980s. The housing industry's contribution to the state's economy jumped nearly 60 percent from $7.2 billion in 1982 to $11.5 billion in 1983, according to the analysis.
 Figures resulting from the analysis are based on the estimated economic impact of new home construction and sales, as well as resale housing activity in California. The figures do not include the economic impact of the commercial real estate market or the apartment market.
 Among other highlights from C.A.R.'s economic impact analysis:
 The Housing Industry's Share of California's Gross State Product:
 -- The housing industry is expected to account for 2.8 percent of California's Gross State Product (GSP) this year, up from 2.5 percent in 1991, according to the analysis.
 -- Since 1980, economic output contributed by the housing industry as a share of California's GSP has been as low as 1.9 percent at the bottom of the last recession in 1982, and as high as 4.4 percent at the peak of the last housing boom in 1989.
 The Housing Industry's Total Impact on California's Economy (Including the ripple effect):
 -- While the housing industry makes a direct contribution to the economy, it also has various indirect effects. The construction or sale of a home, for example, triggers ripple effects in many related areas of the economy, including everything from moving companies to furniture sales to loan processing.
 -- When taking into account both the direct and indirect effects, California's housing market is expected to contribute an estimated $49.7 billion worth of goods and services to the state's economy in 1992, up 16.7 percent from an estimated $42.6 billion last year, according to the analysis.
 The Housing Industry's Total Impact on California Employment (Including the ripple effect):
 -- Given the historical relationship between the housing industry's economic output and employment, the projected $49.7 billion in total output resulting from housing in 1992 represents 519,200 jobs linked directly and indirectly to the industry, the analysis shows. This is an increase of 77,300 jobs -- up 17.5 percent -- from 441,900 jobs in 1991.
 "The upturn in residential real estate activity means that housing will be one of the key growth industries in California this year," said Leslie Appleton-Young, C.A.R.'s vice president of research and economics. "Housing activity is a crucial ingredient for an overall economic recovery, since healthy activity supports jobs linked directly to home sales and construction, as well as jobs in many other related sectors of the economy," said Appleton-Young.
 The California Association of Realtors is a statewide trade association with 130,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.
 Housing Industry's Direct Impact on the California Economy
 (Chart 1)
 The following chart shows estimated direct housing output in the California economy from 1980 through 1991. A projection is included for 1992. Direct housing output is the value of goods and services contributed by the housing industry to California's economy. (These figures do not take into account the commercial real estate market or the apartment market.)
 The chart also shows the housing industry's share of California's Gross State Product (GSP) from 1980 through 1991. A projection is included for 1992.
 For example, in 1991, the housing industry directly contributed $18.4 billion worth of goods and services to California's economy. This amounted to 2.5 percent of California's Gross State Product (GSP).
 Housing industry's
 share of California's
 Estimated Direct Gross State Product
 Year Housing Output (GSP)
 1980 $11.9 billion 3.7 percent
 1981 $ 9.6 billion 2.7 percent
 1982 $ 7.2 billion 1.9 percent
 1983 $11.5 billion 2.8 percent
 1984 $13.0 billion 2.8 percent
 1985 $14.2 billion 2.8 percent
 1986 $18.3 billion 3.4 percent
 1987 $21.5 billion 3.7 percent
 1988 $26.3 billion 4.1 percent
 1989 $30.4 billion 4.4 percent
 1990 $22.4 billion 3.0 percent
 1991 $18.4 billion 2.5 percent
 1992 (a) $21.3 billion 2.8 percent
 (a) Projection
 Source: California Association of Realtors
 Housing Industry's Total Impact on the California Economy and Jobs
 (Including the ripple effect)
 (Chart 2)
 The following chart shows estimated total housing output in the California economy from 1980 through 1991, including the ripple effect. A projection is included for 1992.
 The construction or sale of a home triggers ripple effects in many other areas of the economy, including everything from moving companies to furniture sales to loan processing.
 The total housing output figures in this chart take into account both the direct and indirect effects of the housing industry on California's economy.
 The chart also shows the number of California jobs linked directly and indirectly to the housing industry each year, based on that year's total housing output figure.
 Estimated Total Housing Number of jobs
 Output (including linked directly and
 Year ripple effect) indirectly to housing
 1980 $28.2 billion 315,800 jobs
 1981 $22.8 billion 242,600 jobs
 1982 $17.3 billion 184,400 jobs
 1983 $27.4 billion 269,600 jobs
 1984 $31.1 billion 336,800 jobs
 1985 $34.0 billion 367,100 jobs
 1986 $43.5 billion 467,600 jobs
 1987 $51.4 billion 552,200 jobs
 1988 $62.3 billion 664,900 jobs
 1989 $72.2 billion 772,500 jobs
 1990 $52.8 billion 557,600 jobs
 1991 $42.6 billion 441,900 jobs
 1992 (a) $49.7 billion 519,200 jobs
 (a) Projection
 Source: California Association of Realtors
 -0- 4/8/92
 /CONTACT: Jeff Hershberger or Lotus Lou of the California Association of Realtors, 213-739-8304/ CO: California Association of Realtors ST: California IN: FIN SU:


AL-JL -- LA013 -- 6183 04/08/92 11:07 EDT
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