What drives this market

It may be a familiar story, but it’s one that still is hot. The

housing market in Newport-Mesa continues to burn brightly, fueled by

a combination of low interest rates and the simple, irrefutable fact

that people desperately want to live here. The beach and harbor are

nearby. The schools are excellent. The social life can be a dream,

with gourmet restaurants and private clubs to get the party started

and keep it rolling.

In this environment, it’s difficult to blame anyone for wanting a

Newport-Mesa address.

In June, that desperation resulted in soaring home prices.

According to the California Assn. of Realtors, the median home price

in Newport Beach was up 29.9% compared to a year earlier, rising from

$663,750 to $862,750. In Costa Mesa, the median home price was

$440,000, up 17.3% from $375,00 the year before.

For those interested in how Newport-Mesa fares compared to the

county, both cities are above the median county price of $405,000,

which was a 15.7% increase from 2002.

The signs of this market are hard to miss. Drive down Coast

Highway near Crystal Cove and look inland. There is a whole hill of

new homes. Turn off Victoria Street on the Westside of Costa Mesa and

there are plenty of “For sale” signs. Jog along the Balboa Peninsula

and eye-popping price tags hang from beachfront homes.

All this makes it a terrific time to be either a homeowner or a

Realtor, all of whom are reaping tangible rewards. And, by extension,

it sets the stage for a strong local economy, where people have money

to spend and have moved to a place where they can spend it.

Does it seem like it has been this way forever? Does it seem like

it will stay this way forever?

This month, finally, there are signs of possible slowing. Interest

rates, which have helped propel home purchases and pricing, are

ticking up ever so slightly. The stock market remains flat. The

economy is still waiting for its “Go” button to be pushed.

But even in a less robust market, that simple, irrefutable fact

will remain: People are going to want to live here. And they will pay

for the privilege.