While the current situation in Elk Grove seems dire, the long range forecast is quite bright and one assumes the community is resilient enough to survive the former and work towards the latter.
Bubble bursts in Elk Grove
City may become yardstick for measuring region's recession
By Dale Kasler and Jon Ortiz - dkasler@sacbee.com
Published 12:00 am PST Sunday, February 3, 2008
Elk Grove, already mired in an economic slump, may be at the forefront of what's coming to the entire Sacramento region.
Already home foreclosures there are up fivefold. Unemployment has climbed. Vacancies at small strip malls are three times the regionwide average, and Laguna Ridge – a big new master-planned development – is largely a ghost town of unsold homes and vacant lots.
Shards of similar economic news have started to appear elsewhere in the Sacramento region: Vacancies are increasing in South Placer's office parks; the city of Sacramento has instituted its first-ever layoffs; and the state, facing a $14.5 billion deficit, has canceled a huge office project near the Capitol.
Whether Elk Grove's economic downturn signals a recession is hard to determine, as is what it may foreshadow elsewhere. But its 136,000 residents have felt the shift, particularly in real estate.
And with the region's unemployment rate rising, homeowners aren't the only people struggling.
"We're doing our best to stay open," said Chris Correa, co-owner of a long-standing brewpub called Elk Grove Brewery Restaurant.
"There used to be a housing boom, a lot of new people, a lot of new money moving in here. Now people's houses are losing equity. … People are incurring debt and they're just not coming out to restaurants."
Elk Grove may not be typical. Some real estate experts say it's taking a worse beating than other communities in the area. And no one argues that its long-term future is anything but bright. But its experience with an economy that became overly dependent on real estate is instructive nevertheless.
