As reported in Financial Times (FT.com) California and Florida are either entering or about to enter a period of recession. California is the country's largest economy while Florida is the fourth largest. Around the country, many of the largest economies are hitting recession marks.
Other states such as Ohio and Michigan are believed to already be headed into recession due to poor housing markets there, coupled with poor economy. Both states have seen large numbers in terms of job loss.
Other states, which traditionally have been considered good property investment states, such as Nevada and Arizona are also likely to feel the impact of recession. Their property markets are on the likely road out of the property boom that has been lingering for several years.
California's economy is very largest, the 10th largest in the world, if California was an independent country. While states do not usually call a lagging economy a recession, as only nations actually are attributed to this term, regional recessions are often labelled as such.
Perhaps the likely reason behind this, according to reports by the Financial Times is that home sales have fallen drastically here. Sales fell by 30 to 35 per cent in these economies, which is coupled by the fact that home prices fell over 10 per cent in both California and Florida through November of 2007.
Florida existing home sales are down 20 per cent, which Florida existing condo sales are down 29 per cent. Florida has a huge number of unused condos on the market. Consumer confidence here stands at 74 per cent.