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3rd highest year for home sales

Median closing price drops below 1999 levels

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3rd highest year for home sales

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POSTED January 28, 2012 12:53 a.m.

There were 1,173 existing homes sold within Manteca’s city limits during 2011.

It was the third highest year on record for sales volume. Prices, though, dropped to pre-1999 levels with the median closing escrow coming in at $179,950. That was $5,950 less per home compared to 2010 when eight more homes closed escrow but $1,950 more than in 2009 when a record 1,211 homes sold.

The median sales price in 1999 in Manteca was $180,450 when 633 existing homes sold. Resale home prices are off 43.6 percent from the historic peak in 2006 when 427 existing homes were sold.

During the last four years 4,730 existing homes sold in Manteca or just over one in every five homes.

That, however, only tells one side of the foreclosure story of people being forced to sell or losing their homes. Realtors note a slight majority  of the buyers of the 4,730 homes are people who work and reside in the valley and could only afford to rent in the once red-hot housing market. At the same time, the amount of homes bought by investors has soared.

The silver lining of the foreclosure mess that triggered the housing market collapse is affordability. Economists contend housing is affordable when it doesn’t exceed more than 2.5 times an area’s median household income. In Manteca, the median price of a home in 2006 was 7.5 times the median household income. Median household income in Manteca in 2009 based on state Department of Finance figures was $61,315. Median housing prices in 2009 were at $178,000 or $1,950 less than they were in 2011. That translates into housing prices being 2.9 times more than annual income.

Individual affordability is determined the same way. If a household has a $40,000 annual income and  bought a house for $90,000 it reflects the price being 2.25 times income . That puts it below the theoretical break-even point for affordability.

The least expensive existing home to sell in Manteca in 2011 went for $33,000. The most expensive sold for $460,000. Only eight homes out of 1,173 that closed escrow last year sold for more than the 2006 Manteca median price of $413,000.

The housing segment that suffered the biggest collapse in Manteca over the past six years is the McMansions.

The bellwether in Manteca for McMansions is the huge rectangular boxes Seeno Homes built with three-car garages and 4,336 square feet of living space in the Heritage Ranch neighborhood south and east of Joshua Cowell School. Six years ago, the 4,336-square-foot Seeno homes hit a record high $750,000 for a tract home. In 2009, escrow closed on one of the McMansions on Vasconcellos Avenue for $230,000. That is a 69 percent plunge in value.

Such bargain basement prices don’t even reflect the replacement cost of the house, land and improvements such as water and sewer infrastructure

 While Manteca  has been selling just about 1,200 existing homes annually for the past four years, new home sales have averaged 280 a year since 2008. That is significantly higher than in Stockton and Modesto.

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