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Local housing inventory remains low

• Construction activity very slow in Ceres

POSTED September 6, 2017 10:12 a.m.
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Those wanting to buy a home in the Ceres area may be looking for quite a while and then competing with many other potential buyers as the local housing market remains limited. A lack of inventory, and qualified buyers, is a trend not only locally but also statewide.

Long-time homeowners are not moving as often as they have in the past, according to Geoff McIntosh, president of the California Association of Realtors. McIntosh credits this lack of real estate mobility primarily due to low rates on their current mortgages, low property taxes and no place to go.

He recently addressed the Central Valley Association of Realtors during its annual member luncheon to inform area real estate agents on local market trends and update them on statewide legislation.

According to McIntosh, the Housing Affordability Index of Traditional Buyers put out by CAR shows that only 31 percent of California households can afford to purchase a median-priced home, compared to 58 percent nationwide.

"Homeowners are not moving as often, staying in their homes for 10 years or longer, because right now there isn't somewhere affordable for them to go," McIntosh said, referring to the low new-home construction market.

Although Bay Area cities have seen an increase in new home construction, new build activity is spotted up and down the Central Valley.

"Families looking to move up or downsize to a newer home have limited options," said CVAR President Kris Klair. "Despite a healthy economy we're just not seeing as much new-build construction as we'd like."

Median-priced, resale homes fly off the shelves as soon as they hit the active market, Klair added.

According to Tom Westbrook, Community Development Director for the city of Ceres, most of the single-family development in Ceres is being constructed on infill lots, like xxxxxx subdivisions.

"A lot of what we have going on in Ceres for the past few years is the completion of the remaining lots from previously approved single-family subdivisions from 2004-2006," said Westbrook. "There are 40 finished lots in Tuscany Village which is located on Whitmore Avenue and another 80 finished lot at Westpointe 4 which is at the corner of Malik Drive and Whitmore Avenue. There are been some interest recently in both subdivisions, however, no one has submitted construction documents to build any homes on those lots."

Despite these upcoming developments, home construction is way down in Ceres.

So far in 2017, the city of Ceres has issued 11 permits for single-family homes, based upon the latest report by the Building and Safety Division. Last year, the city issued three building permits for single-family homes.

By contrast, in 2004 there were 633 building permits for new single-family homes. Most of that construction occurred in Westpointe, and in Brown and Eastgate master plan areas. Permit numbers fell off to 121 in 2005. Single-family permits dropped from 123 in 2007 to 45 in 2008 and 10 in 2009. Housing production fell rapidly during the years following the recession. From 2010 to 2012, only two permits were issued in Ceres.


California, like much of the country, saw a drop in closings in June because interested buyers are being tripped up by a challenging supply of homes and price growth that's straining their budgets, National Association of Realtors Chief Economist Lawrence Yun reported last month.

McIntosh also shared that software developers ($123,900), registered nurses ($101,260), computer programmers ($92,170) and law enforcement personnel ($93,550) are among the highest paid wage earners that are able to afford a home in California. According to Bureau of Labor statistics, the minimum income required to buy a home in California is $96,790.

Jeff Benziger contributed to this report.

 

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