Rebuilding after fires a boon to San Diego region

By Jim Christie - Analysis

SAN FRANCISCO (Reuters) - The San Diego region is poised for an economic boost next year as homeowners who lost houses in last week's dramatic wildfires there set about rebuilding, analysts said on Tuesday.

While fires whipped by violent Santa Ana winds threatened communities across Southern California, they were especially intense in San Diego County, blackening more than 368,000 acres and destroying more than 1,500 homes.

Initial estimates of insured losses in the county fall in a range of $1 billion to $2 billion as many homeowners return to properties to find only slabs, fireplaces and charred remains of their possessions.

The fires will disrupt the county economy in the near term, but their thorough destruction points to a local building boom over the next year as burned-out residents rebuild homes with payments from insurers -- a process the region knows well after wildfires there in 2003 ago consumed 2,600 homes and the local economy rebounded in the following year.

Alan Nevin, a San Diego economist who advises home builders, sees reconstruction starting as early as spring.

"Assuming everybody gets their acts together immediately, it would take about six months," he said. "It's nothing starting tomorrow morning, but when it hits it will be significant."

Only 4,000 new single-family homes will be built this year in San Diego County -- compared with a peak in new single-family home permits of 9,749 in 2002 -- so an additional 1,500 or more home projects would mark a big boost for local building, Nevin said.

Alan Gin, an urban economist with the University of San Diego's Burnham-Moores Center for Real Estate, noted only 138 permits for new single-family homes were authorized in September for the entire county, California's third most populous county.