Randolph Kinney
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San Diego Population Declining
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Housing Bubble Bursting?
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moh malekpour
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San Diego County set the pace in the run-up. The big question now is how low will it
http://www.latimes.com/business/la-fi-homes13jul13,1,4002228.story?coll=la-headlines-business
San Diego County kicked off California's housing boom six years ago with dramatic price rises and became one of the nation's hottest real estate markets.
Now it has attained a more dubious distinction: It's the first major California real estate market to see its median home price fall below year-earlier levels, according to data released Wednesday
http://www.latimes.com/business/la-fi-homes13jul13,1,4002228.story?coll=la-headlines-business
San Diego County kicked off California's housing boom six years ago with dramatic price rises and became one of the nation's hottest real estate markets.
Now it has attained a more dubious distinction: It's the first major California real estate market to see its median home price fall below year-earlier levels, according to data released Wednesday
Steve Owen
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george foster said:
I sincerely hope so. However, "or putting them into a loan they allege they couldn’t afford"? What happened to the borrower's responsibility to only borrow as much as they can afford to repay?
On the other hand, if the appraiser overvalued the property for the purpose of facilitating the loan, there should be some responsibility for that. If the loan company did things of an illegal nature, such as pressuring the appraiser, there should be some responsibility for that. But, "or putting them into a loan they allege they couldn’t afford...." I don't think so!
Big ole Boy
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I hear there some good real estate deals right now over on the Gaza Strip and a few properties left over in Lebanon ..... need a little refurbishment ....
They accept small arms and rockets as downpayments .....
They accept small arms and rockets as downpayments .....
Randolph Kinney
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San Diego Housing Decline 1st In Decade
By Lori Weisberg
and Emmet Pierce
UNION-TRIBUNE STAFF WRITERS
July 13, 2006
San Diego County's once blistering housing market moved into negative territory for the first time in 10 years as overall prices declined 1 percent last month from June 2005.
With home sales slowing for the 24th consecutive month, real estate analysts said the decline clearly indicates a softening market, but not one that is destined to crash.
“Across the region, prices are coming down, incentives are rampant, and sellers are adjusting to longer times on the market,” said Peter Dennehy of Sullivan Group Real Estate Advisors.
“People have come to regard their homes as a cash machine, and that's not how you should be looking at real estate,” he said.
DataQuick Information Systems reported yesterday that last month's median home price slid to $488,000, off 1 percent from a year earlier, and down 6 percent from last November's peak of $518,000.
Although resale prices for single-family homes showed a gain of nearly 2 percent from June 2005, the market's drop was brought by sagging prices for resale condos and new houses, DataQuick analyst John Karevoll said.
“To me, this is just part of a plateauing of prices,” he said. “Between now and the fall, I'd say half the months will be slightly positive and half slightly negative, but I really don't read the drama in these numbers that most people will.”
The numbers should come as little surprise to many home sellers who have watched their properties sit on the market for months, in some cases lowering their asking prices in hopes of getting an offer.
After having his vacant Escondido townhome languish for more than five months, Todd Fleischmann realized his price was too high for a market now driven by rising mortgage interest rates and slowing demand.
Late last month, after relocating to Portland, Ore., the 26-year-old computer network administrator and his wife, Elizabeth, changed real estate agents and dropped their asking price by nearly $24,000 to $338,000. Fleischmann had paid $324,000 for the property in mid-2004.
“It has been a disappointment but it is what it is,” Fleischmann said. “I am more concerned with selling my property than trying to get top dollar.”
Because the couple's finances have been stretched by the burden of paying rent in Portland, along with mortgage and homeowner fees on the Escondido property, they've decided to cut their losses.
“My wife and I are trying to get our lives started,” Fleischmann said. “It wasn't happening in San Diego. It is a pretty expensive area to live in.”
San Diego real estate agent Calvin Goad, who represents the Fleischmanns, says the region is experiencing a normal cycle of decline following a boom. “The prices are coming down right now, but it is a good time for the buyer to jump into the market,” he said. “San Diego historically does take a small drop in price, but then the market levels.”
Amid the overall price drop – the first since July 1996 – there were some positive signals in the market report for last month, including substantial price jumps for some communities from a year ago.
Single-family resale houses, more than half of the local housing market, showed a price gain of 1.8 percent over June of last year, DataQuick found. The median price last month in the category reached $565,000, a slight decline from May's record of $569,500. The median represents the midpoint of all sales, with half above and half below that figure.
Nevertheless, sales were down 24 percent from a year earlier, the 24th consecutive month of year-to-year sales declines.
“We are seeing an increase of inventories to normal levels, but it has dramatically changed the psychology of the market,” said Leslie Appleton-Young, chief economist for the California Association of Realtors. “Buyers have more properties to look at, more time to decide.
“There is excess steam in the market created by three to four years of very rapid price appreciation,” she said.
Still, long gone are the heady days of double-digit price gains. The last time San Diego County saw year-over-year increases in the double digits was April of last year, topping off a trend that had held steady for 64 consecutive months, Karevoll said.
Home prices for the first half of this year rose a mere 2.7 percent, compared with 11 percent during the same period last year, a clear indicator of a deflating market.
No one knows that better than Pat and Sandra Daugherty, who have been trying to sell their Fletcher Hills home since February with no luck, despite lowering the price by more than $50,000.
Currently out of work and eager to move to Colorado or Texas for a new job, Pat Daugherty fears he and his wife might lose money on the 2,000-square-foot home they bought two years ago for $540,000. They've put roughly $75,000 in improvements into the house and have an asking price ranging from $635,000 to $675,000.
“At this point, we're willing to take a loss,” said Daugherty, who has two sons, ages 20 and 22, who will be moving with their parents. “We really need to get this off our back so we can get on with it. I'm obviously frustrated because we worked so long and hard on this, but sooner or later the prices had to back down.”
Dyann Reilly, a retired schoolteacher, has been struggling to sell her two-story, 2,010-square-foot downtown condo for a year while she lives in a one-story downtown unit that is more comfortable for her. She originally listed the condo she bought four years ago for $630,000 at $1.2 million but has since lowered the asking price to $900,000.
“I think people who come downtown want a view, and I don't have one,” said Reilly, 65. “I also think there are too many condos available.”
Countywide, the number of homes for sale has been rising steadily, with active listings hovering at 19,803 last month, according to the San Diego Association of Realtors. That compares with about 10,900 a year ago and 6,600 in 2004.
San Diego home builders are also feeling the effects of a sluggish market and are responding by dropping prices and offering generous incentives, noted Dennehy of the Sullivan Group.
The segment of the housing market showing the biggest drop last month was new home sales, which saw prices decline 8 percent. That was influenced, in part, by a weakening demand for condo conversions.
“Sales have slowed, concessions have increased, and prices have dropped fairly significantly,” said Paul Kerr, president of Davlyn Investments, a local condo converter. “Buyers are sitting on the sidelines waiting for a theoretical price reduction of 30 percent, and I don't necessarily believe that's going to happen.”
Steve Doyle, Brookfield Homes' president for the San Diego region, said his company has been helping buyers with financing costs and offering upgrades.
Recent Brookfield incentives have ranged from about $3,000 for a $400,000 attached home to as much a $20,000 for homes that cost in excess of $1 million, he said.
Shares of publicly held Brookfield dipped recently when the company cut its full-year forecast for home sales, citing slowing markets in the San Diego and Riverside areas and Washington, D.C.
“Long-term, the housing market remains very strong,” Doyle emphasized. “When you look at economics, we still have positive job growth.”
While many neighborhoods throughout San Diego County continue to experience sizable upswings in home values, there were nearly three dozen ZIP codes where median prices fell in June, according to DataQuick. And of the more than 90 ZIP codes in the county, all but 10 had median prices last month that were lower than their peaks set in previous months, Karevoll said.
Some homeowners still have the luxury of waiting out the stalled market until price appreciation resumes.
By Lori Weisberg
and Emmet Pierce
UNION-TRIBUNE STAFF WRITERS
July 13, 2006
San Diego County's once blistering housing market moved into negative territory for the first time in 10 years as overall prices declined 1 percent last month from June 2005.
With home sales slowing for the 24th consecutive month, real estate analysts said the decline clearly indicates a softening market, but not one that is destined to crash.
“Across the region, prices are coming down, incentives are rampant, and sellers are adjusting to longer times on the market,” said Peter Dennehy of Sullivan Group Real Estate Advisors.
“People have come to regard their homes as a cash machine, and that's not how you should be looking at real estate,” he said.
DataQuick Information Systems reported yesterday that last month's median home price slid to $488,000, off 1 percent from a year earlier, and down 6 percent from last November's peak of $518,000.
Although resale prices for single-family homes showed a gain of nearly 2 percent from June 2005, the market's drop was brought by sagging prices for resale condos and new houses, DataQuick analyst John Karevoll said.
“To me, this is just part of a plateauing of prices,” he said. “Between now and the fall, I'd say half the months will be slightly positive and half slightly negative, but I really don't read the drama in these numbers that most people will.”
The numbers should come as little surprise to many home sellers who have watched their properties sit on the market for months, in some cases lowering their asking prices in hopes of getting an offer.
After having his vacant Escondido townhome languish for more than five months, Todd Fleischmann realized his price was too high for a market now driven by rising mortgage interest rates and slowing demand.
Late last month, after relocating to Portland, Ore., the 26-year-old computer network administrator and his wife, Elizabeth, changed real estate agents and dropped their asking price by nearly $24,000 to $338,000. Fleischmann had paid $324,000 for the property in mid-2004.
“It has been a disappointment but it is what it is,” Fleischmann said. “I am more concerned with selling my property than trying to get top dollar.”
Because the couple's finances have been stretched by the burden of paying rent in Portland, along with mortgage and homeowner fees on the Escondido property, they've decided to cut their losses.
“My wife and I are trying to get our lives started,” Fleischmann said. “It wasn't happening in San Diego. It is a pretty expensive area to live in.”
San Diego real estate agent Calvin Goad, who represents the Fleischmanns, says the region is experiencing a normal cycle of decline following a boom. “The prices are coming down right now, but it is a good time for the buyer to jump into the market,” he said. “San Diego historically does take a small drop in price, but then the market levels.”
Amid the overall price drop – the first since July 1996 – there were some positive signals in the market report for last month, including substantial price jumps for some communities from a year ago.
Single-family resale houses, more than half of the local housing market, showed a price gain of 1.8 percent over June of last year, DataQuick found. The median price last month in the category reached $565,000, a slight decline from May's record of $569,500. The median represents the midpoint of all sales, with half above and half below that figure.
Nevertheless, sales were down 24 percent from a year earlier, the 24th consecutive month of year-to-year sales declines.
“We are seeing an increase of inventories to normal levels, but it has dramatically changed the psychology of the market,” said Leslie Appleton-Young, chief economist for the California Association of Realtors. “Buyers have more properties to look at, more time to decide.
“There is excess steam in the market created by three to four years of very rapid price appreciation,” she said.
Still, long gone are the heady days of double-digit price gains. The last time San Diego County saw year-over-year increases in the double digits was April of last year, topping off a trend that had held steady for 64 consecutive months, Karevoll said.
Home prices for the first half of this year rose a mere 2.7 percent, compared with 11 percent during the same period last year, a clear indicator of a deflating market.
No one knows that better than Pat and Sandra Daugherty, who have been trying to sell their Fletcher Hills home since February with no luck, despite lowering the price by more than $50,000.
Currently out of work and eager to move to Colorado or Texas for a new job, Pat Daugherty fears he and his wife might lose money on the 2,000-square-foot home they bought two years ago for $540,000. They've put roughly $75,000 in improvements into the house and have an asking price ranging from $635,000 to $675,000.
“At this point, we're willing to take a loss,” said Daugherty, who has two sons, ages 20 and 22, who will be moving with their parents. “We really need to get this off our back so we can get on with it. I'm obviously frustrated because we worked so long and hard on this, but sooner or later the prices had to back down.”
Dyann Reilly, a retired schoolteacher, has been struggling to sell her two-story, 2,010-square-foot downtown condo for a year while she lives in a one-story downtown unit that is more comfortable for her. She originally listed the condo she bought four years ago for $630,000 at $1.2 million but has since lowered the asking price to $900,000.
“I think people who come downtown want a view, and I don't have one,” said Reilly, 65. “I also think there are too many condos available.”
Countywide, the number of homes for sale has been rising steadily, with active listings hovering at 19,803 last month, according to the San Diego Association of Realtors. That compares with about 10,900 a year ago and 6,600 in 2004.
San Diego home builders are also feeling the effects of a sluggish market and are responding by dropping prices and offering generous incentives, noted Dennehy of the Sullivan Group.
The segment of the housing market showing the biggest drop last month was new home sales, which saw prices decline 8 percent. That was influenced, in part, by a weakening demand for condo conversions.
“Sales have slowed, concessions have increased, and prices have dropped fairly significantly,” said Paul Kerr, president of Davlyn Investments, a local condo converter. “Buyers are sitting on the sidelines waiting for a theoretical price reduction of 30 percent, and I don't necessarily believe that's going to happen.”
Steve Doyle, Brookfield Homes' president for the San Diego region, said his company has been helping buyers with financing costs and offering upgrades.
Recent Brookfield incentives have ranged from about $3,000 for a $400,000 attached home to as much a $20,000 for homes that cost in excess of $1 million, he said.
Shares of publicly held Brookfield dipped recently when the company cut its full-year forecast for home sales, citing slowing markets in the San Diego and Riverside areas and Washington, D.C.
“Long-term, the housing market remains very strong,” Doyle emphasized. “When you look at economics, we still have positive job growth.”
While many neighborhoods throughout San Diego County continue to experience sizable upswings in home values, there were nearly three dozen ZIP codes where median prices fell in June, according to DataQuick. And of the more than 90 ZIP codes in the county, all but 10 had median prices last month that were lower than their peaks set in previous months, Karevoll said.
Some homeowners still have the luxury of waiting out the stalled market until price appreciation resumes.
Randolph Kinney
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Builder Gets Hammered As Sales Go Away
D.R. Horton Cuts Year Outlook As Home-building Market Slumps
07-14-06 11:33 AM EST
NEW YORK (Dow Jones) -- Home-building stocks were trading lower Friday after D.R. Horton Inc., the nation's largest builder, cut its full-year earnings forecast by almost a third due to tough conditions in the residential-real- estate market.
D.R. Horton (DHI) late Thursday reported third-quarter sales orders fell to $ 3.8 billion, or 14,316 homes, from $4.1 billion, or 14,980 homes, in the year- earlier period. The figures indicate drops of more than 7% in dollar value and more than 4% in units.
Donald Horton, chairman of the S&P 500 constituent based in Fort Worth, Texas, noted the "difficult selling conditions the homebuilding industry is experiencing.
"The current home-sales environment is characterized by an increase in both existing and new homes available for sale, higher-than-normal cancellation rates and an increase in the use of sales incentives in many of our markets," he added.
Builder shares have fallen heavily this year on the deeper-than-expected pullback in the U.S. housing market after a multiyear boom. The Dow Jones U.S. Home Construction Index (DJ_3728) was down 35% year to date through Thursday's close as investors also fretted over higher mortgage rates.
For the third quarter ended June 30, the company now expects per-share earnings of 93 cents, which reflects 11 cents a share for land-option write- offs. It also lowered its per-share view for the year to $3.65 or more on 50,000 homes closed. In 2005, the builder delivered 51,383 homes.
Analysts polled by Thomson First Call had expected D.R. Horton to post earnings of $1.30 a share for the quarter and $4.92 a share for the year.
In April, the company said it expected fiscal year per-share net income of $ 5.25 to $5.35.
The stock was down about 9% in early trading at $20.88.
More pain for builders
The company follows several other bellwethers in the builder group, such as KB Home (KBH) and Toll Brothers Inc. (TOL) which have lowered their 2006 profit outlooks on the housing downturn.
Some analysts following the industry were caught off guard by the magnitude of D.R. Horton's profit warning.
"To say our initial reaction was surprise" would "heavily underestimate the impact; we were shocked," wrote Susquehanna Financial Group analyst Stephen East in a research note.
"Cancellations have taken a mighty toll on D.R. Horton's ability to deliver on its forecast, which has reduced its revenue and pressured margins as incentives have jumped substantially," he said. The shares should "get hit hard" on Friday, he added.
"Even this housing bear is stunned," said A.G. Edwards analyst Gregory Gieber in a note Friday. "This is an industry epidemic, and we believe others could get hit worse."
D.R. Horton Cuts Year Outlook As Home-building Market Slumps
07-14-06 11:33 AM EST
NEW YORK (Dow Jones) -- Home-building stocks were trading lower Friday after D.R. Horton Inc., the nation's largest builder, cut its full-year earnings forecast by almost a third due to tough conditions in the residential-real- estate market.
D.R. Horton (DHI) late Thursday reported third-quarter sales orders fell to $ 3.8 billion, or 14,316 homes, from $4.1 billion, or 14,980 homes, in the year- earlier period. The figures indicate drops of more than 7% in dollar value and more than 4% in units.
Donald Horton, chairman of the S&P 500 constituent based in Fort Worth, Texas, noted the "difficult selling conditions the homebuilding industry is experiencing.
"The current home-sales environment is characterized by an increase in both existing and new homes available for sale, higher-than-normal cancellation rates and an increase in the use of sales incentives in many of our markets," he added.
Builder shares have fallen heavily this year on the deeper-than-expected pullback in the U.S. housing market after a multiyear boom. The Dow Jones U.S. Home Construction Index (DJ_3728) was down 35% year to date through Thursday's close as investors also fretted over higher mortgage rates.
For the third quarter ended June 30, the company now expects per-share earnings of 93 cents, which reflects 11 cents a share for land-option write- offs. It also lowered its per-share view for the year to $3.65 or more on 50,000 homes closed. In 2005, the builder delivered 51,383 homes.
Analysts polled by Thomson First Call had expected D.R. Horton to post earnings of $1.30 a share for the quarter and $4.92 a share for the year.
In April, the company said it expected fiscal year per-share net income of $ 5.25 to $5.35.
The stock was down about 9% in early trading at $20.88.
More pain for builders
The company follows several other bellwethers in the builder group, such as KB Home (KBH) and Toll Brothers Inc. (TOL) which have lowered their 2006 profit outlooks on the housing downturn.
Some analysts following the industry were caught off guard by the magnitude of D.R. Horton's profit warning.
"To say our initial reaction was surprise" would "heavily underestimate the impact; we were shocked," wrote Susquehanna Financial Group analyst Stephen East in a research note.
"Cancellations have taken a mighty toll on D.R. Horton's ability to deliver on its forecast, which has reduced its revenue and pressured margins as incentives have jumped substantially," he said. The shares should "get hit hard" on Friday, he added.
"Even this housing bear is stunned," said A.G. Edwards analyst Gregory Gieber in a note Friday. "This is an industry epidemic, and we believe others could get hit worse."
Pamela Crowley (Florida)
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- Florida
http://www.dfw.com/mld/dfw/business/15039191.htm
D.R. Horton shares fall after home builder cuts outlook
Associated Press
DALLAS - Shares of D.H. Horton Inc. tumbled more than 8 percent Friday after the home builder cut its profit expectations and announced that recent sales orders plunged more than 7 percent from a year ago, further evidence that the housing market is slowing.
Horton said late Thursday that orders in its fiscal third quarter, which ended June 30, fell to $3.8 billion from $4.1 billion.
The decline in number of houses was closer to 4 percent, slipping to 14,316 from 14,980 homes a year earlier. Horton cut its full-year forecast to 50,000 homes from an earlier prediction of 58,000.
The company said it expects to earn 93 cents per share in the June quarter, including a charge of 11 cents per share for forfeiting options and other land costs. It also cut its full-year outlook to $3.65 - down from an April forecast of $5.25 to $5.35 per share.
Analysts had expected the company to earn $1.30 per share in the last quarter and $4.92 per share for the year, according to a survey by Thomson Financial.
Horton is the latest builder to cut its profit outlook for this year since May, joining Toll Brothers Inc., Hovnanian Enterprises Inc., and KB Home.
Chairman Donald R. Horton said home builders are encountering "difficult selling conditions."
"The current home-sales environment is characterized by an increase in both existing and new homes available for sale, higher-than-normal cancellation rates and an increase in the use of sales incentives in many of our markets," he said in a statement issued by the Fort Worth-based company.
Horton shares fell $1.88, or 8.2 percent, to $20.98 in Friday morning trading on the New York Stock Exchange. During the morning session, they dipped below $20.29, setting a 52-week low.
Margaret Whelan, an analyst with UBS, said the steeper decline in dollar value than number of orders indicates that the company built too many homes on speculation - believing a buyer would come along - and now must slash prices to sell them.
The company is scheduled to report June-quarter earnings on July 20.
Horton claims to be the largest home builder in the United States, completing more than 51,000 houses in its last fiscal year, which ended Sept. 30. The company operates in 83 markets in 27 states mostly in the southern part of the country from the Mid-Atlantic to the West.
D.R. Horton shares fall after home builder cuts outlook
Associated Press
DALLAS - Shares of D.H. Horton Inc. tumbled more than 8 percent Friday after the home builder cut its profit expectations and announced that recent sales orders plunged more than 7 percent from a year ago, further evidence that the housing market is slowing.
Horton said late Thursday that orders in its fiscal third quarter, which ended June 30, fell to $3.8 billion from $4.1 billion.
The decline in number of houses was closer to 4 percent, slipping to 14,316 from 14,980 homes a year earlier. Horton cut its full-year forecast to 50,000 homes from an earlier prediction of 58,000.
The company said it expects to earn 93 cents per share in the June quarter, including a charge of 11 cents per share for forfeiting options and other land costs. It also cut its full-year outlook to $3.65 - down from an April forecast of $5.25 to $5.35 per share.
Analysts had expected the company to earn $1.30 per share in the last quarter and $4.92 per share for the year, according to a survey by Thomson Financial.
Horton is the latest builder to cut its profit outlook for this year since May, joining Toll Brothers Inc., Hovnanian Enterprises Inc., and KB Home.
Chairman Donald R. Horton said home builders are encountering "difficult selling conditions."
"The current home-sales environment is characterized by an increase in both existing and new homes available for sale, higher-than-normal cancellation rates and an increase in the use of sales incentives in many of our markets," he said in a statement issued by the Fort Worth-based company.
Horton shares fell $1.88, or 8.2 percent, to $20.98 in Friday morning trading on the New York Stock Exchange. During the morning session, they dipped below $20.29, setting a 52-week low.
Margaret Whelan, an analyst with UBS, said the steeper decline in dollar value than number of orders indicates that the company built too many homes on speculation - believing a buyer would come along - and now must slash prices to sell them.
The company is scheduled to report June-quarter earnings on July 20.
Horton claims to be the largest home builder in the United States, completing more than 51,000 houses in its last fiscal year, which ended Sept. 30. The company operates in 83 markets in 27 states mostly in the southern part of the country from the Mid-Atlantic to the West.
George Hatch
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- Jan 15, 2002
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- California
Different markets are dancing to different beats. Is anyone seeing news accounts touting the profits still being made in those still-warm markets? Or have all those articles gone into remission?
Austin
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- Jan 16, 2002
- Professional Status
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- Virginia
Some People Can't Win For Losing
As I have related many times, our local economy is depressed due to the massive loss of textile and tobacco manufacturing jobs. Highest unemployment in the state and 5th highest in the nation.
We just got a new cabinet industry that opened the doors about three months ago. Created 500 new jobs that the economy desperately needed. My niece's husband works there as he worked formerly for a large tobacco company that moved out of town. I talked with him July 4th and asked if they were making cabinets. He replied that yea, they were smoking. I asked what kind of cabinets they make and who they sell them to. His reply: "We make all of the cabinets for Toll Brothers." Some days it doesn't pay to get out of bed. If it wasn't for bad luck we would have no luck at all.
PS: I hate to mention this, but has anyone noticed that the pace of WWIII is picking up? That ought to help things. If we went in the body bag business they would declare peace.
As I have related many times, our local economy is depressed due to the massive loss of textile and tobacco manufacturing jobs. Highest unemployment in the state and 5th highest in the nation.
We just got a new cabinet industry that opened the doors about three months ago. Created 500 new jobs that the economy desperately needed. My niece's husband works there as he worked formerly for a large tobacco company that moved out of town. I talked with him July 4th and asked if they were making cabinets. He replied that yea, they were smoking. I asked what kind of cabinets they make and who they sell them to. His reply: "We make all of the cabinets for Toll Brothers." Some days it doesn't pay to get out of bed. If it wasn't for bad luck we would have no luck at all.
PS: I hate to mention this, but has anyone noticed that the pace of WWIII is picking up? That ought to help things. If we went in the body bag business they would declare peace.
Randolph Kinney
Elite Member
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- Apr 7, 2005
- Professional Status
- Retired Appraiser
- State
- North Carolina
Commuting costs brake California's Central Valley sales
Commuting costs brake California's Central Valley sales
More far-flung than other Bay Area suburbs, California's Central Valley is experiencing a housing market downturn more pronounced than in the Bay Area, the Mercury News says. During the residential real-estate boom, home buyers were buying properties farther from San Francisco in exchange for cheaper price tags, and Central Valley communities proliferated, the paper says. But now, with higher gasoline costs, rising mortgage rates and significantly appreciated real-estate prices, homes in the region are harder to sell and prices are falling. The article reports that in California's San Joaquin, Stanislaus and Merced counties, sales of new and resale homes dropped 29% in the first five months of this year from the same period last year, according to DataQuick Information Services. At the end of May, almost 4,000 houses were up for sale in San Joaquin County, a year-over-year rise of almost 250%, the Mercury News says. To get an idea of the commute between these communities and San Francisco, a calculation on Indo.com shows that the driving distance between the San Joaquin town of Tracy and San Francisco is 62 miles.
Commuting costs brake California's Central Valley sales
More far-flung than other Bay Area suburbs, California's Central Valley is experiencing a housing market downturn more pronounced than in the Bay Area, the Mercury News says. During the residential real-estate boom, home buyers were buying properties farther from San Francisco in exchange for cheaper price tags, and Central Valley communities proliferated, the paper says. But now, with higher gasoline costs, rising mortgage rates and significantly appreciated real-estate prices, homes in the region are harder to sell and prices are falling. The article reports that in California's San Joaquin, Stanislaus and Merced counties, sales of new and resale homes dropped 29% in the first five months of this year from the same period last year, according to DataQuick Information Services. At the end of May, almost 4,000 houses were up for sale in San Joaquin County, a year-over-year rise of almost 250%, the Mercury News says. To get an idea of the commute between these communities and San Francisco, a calculation on Indo.com shows that the driving distance between the San Joaquin town of Tracy and San Francisco is 62 miles.
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