The immigrants did not consider adobe structures as suitable for permanent housing, resulting in the early establishment of sawmills in the Coast Ranges. Producing the needed lumber for frame houses and brick making became profitable enterprises. Recognizing that the growing demand for frame housing far out-paced the supply, several entrepreneurs imported pre-fabricated houses from New England, by ship around the Horn, which arrived ready to be put together using only an axe and hammer. Commodore Stockton imported several, to place on the land he owned (El Potrero de Santa Clara or the Stockton Rancho), and in 1850 Pegleg Rush imported twenty-three houses from Boston and set them up in town.

Along with construction-related enterprises, agricultural development along American lines quickly began. Impressed by the productivity of the mission's orchards, soon after arrival some farmers started planting small orchards and vineyards; some experimenting with these on the land they intended for wheat farms. After the Mexican-American War was over Joseph Aram had stayed at Santa Clara and established an orchard/nursery, instead of joining those going to the mines. From 350 trees-mostly apples purchased from Aram's nursery at $1.25/tree-E. W. Case planted the first American orchards in Santa Clara in 1850, located on property fronting Alviso Road.

Meanwhile, in Washington, endless debate over the admission of California had been occurring in Congress during these months. Although by a vote of her citizens, California declared for statehood, ratified a constitution and elected a governor, there would be no official recognition until a Statehood Bill was approved by the United States Congress and signed by the President. The subject of California's admission to the Union was brought before Congress when President Zachary Taylor recommended the admission of California in his annual message at the beginning of January 1850. Immediately the controversial issues of admission as a free state or slave state, state boundaries and statehood vs. territory status were raised.

In February, President Taylor sent a formal message to Congress that California had organized a State Government and elected senators and representatives, and through them was applying for admission into the Union. The debate in Congress continued from March through August, with such eminent politicians as Henry Clay, Sam Houston, Daniel Webster and Steven Douglas speaking for and against California's admission. On August 13, 1850 the Senate passed the California Bill on a vote of 34 to 18 and finally on September 7th, it passed in the House - ayes, 150; noes, 56; all the Southern congressmen voting against it. The bill then went to the President, and on September 9th Millard Fillmore, who, by the death of Zachary Taylor, had succeeded to the presidency, signed it, and California was admitted as the thirty-first State.

When the mail steamer Oregon entered into San Francisco Bay on October 18,1850, she brought the news to the eagerly awaiting populace that the Congress of the United States had admitted California to the union as a free state. For several days, from Portsmouth Square in San Francisco to the Statehouse in San Jose, there were celebrations for the new State.

However, while some people "danced and made merry, till daylight, in the pride and joy of their hearts that California was truly now the thirty-first State of the Union," as Frank Soulé wrote in his 1854 Annals of San Francisco and History of California, there were others who would mourn what had occurred. General Mariano Vallejo, when reflecting on the loss of California to the Americans, wrote the following:

"The language now spoken in our country, the laws which govern us, the faces which we encounter daily, are those of the masters of the land, and of course antagonistic to our interests and rights, but what does that matter to the conqueror? He wishes his own well-being and not ours! -a thing that I consider only natural in individuals, but which I condemn in a government which has promised to respect and make respected our rights, and to treat us as its own sons. But what does it avail us to complain? The thing has happened and there is no remedy."