Businesses are expanding and need more space, and that’s helping pump up California’s real estate industry. The real estate and rental leasing industries accounted for nearly a quarter of California’s economic growth in the second quarter, according to a report released Monday by downtown’s City National Bank and consulting firm Beacon Economics.

The real estate and the leasing rental industries were the biggest drivers of economic growth in the quarter. The residential and commercial real estate sectors both showed improvements over the previous quarter. Existing home sales rose almost 7 percent as prices continued to grow.

Other sectors with sizable gains include construction, which grew at a 12.6 percent annual rate, as well as manufacturing, mining and retail trade.

Overall, the state’s economy grew at a 4 percent annual rate in the second quarter, according to the report. That’s up from a 2.5 percent decline in the first quarter and puts California more in line with the U.S. economy’s 4.2 percent growth.

The report found that California employment accelerated, with company payrolls almost 3 percent larger than they were the previous quarter. The professional and business services sector was the largest contributor to the expansion.

Second-quarter estimates from Beacon Economics put total real gross state product at $2.1 trillion, meaning California accounts for more than 13 percent of the United States’ economy.