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Home building at 14-year low

Manteca developers start 223 homes in 2008

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Home building at 14-year low

Manteca developers started 223 new homes in Manteca during 2008.

Bulletin file photo/

POSTED January 6, 2009 12:45 a.m.
Developers ended 2008 starting 223 homes and selling about as many thanks to carry-over housing starts from 2007.
Some may call it disappointing.
Builder Mike Atherton calls it making lemonade from lemons.
It was just 14 months ago when everything was dead in the water from new home sales to existing home sales that some were predicting the total collapse of new housing construction in Manteca. There was just a new home a week being sold. Closed escrows for resale weren’t much better coming in at three a week.
Some who believed the onslaught of foreclosures would completely annihilate new homebuilders. Bargain basement prices triggered by the foreclosure meltdown sent the average price of an existing home in Manteca plunging $116,000 in 2008. Prices by September had dropped so low on resales that once the land and connection fees are taken out of the equation, there was no way a developer could build a home to compete as bank foreclosures in many cases were literally selling for less than the cost of replacing the home.
“We closed one escrow a week in 2008,” Atherton said Monday, “That was pretty darn good.”
Altogether, Atherton Homes sold 55 homes in 2008 in their Manteca neighborhoods. That was second only to Pulte Homes with their Del Webb at Woodbridge community where more than 60 homes closed escrow.
Atherton Homes’ sales were definitely not up to the peak years of 1999 through 2003 where it was norm for the builder to sell between 140 and 180 homes a year. A surprising number of Atherton Homes built in 2008, though, were 2,600 square feet or larger.
That contrasts with Florsheim Homes that deliberately targeted the less than 2,000 square foot market in a bid to keep houses selling. Florsheim Homes closed escrow on 30 homes in their two southwest Manteca neighborhoods and started 28 homes during the year. The difference in closed versus starts is homes that were started in 2007 but not completed until last year.
Final resale figures for existing homes within the city limits of Manteca for 2008 will be out today. The expectation is that a record number of sales — just fewer than 1,200 – were completed last year.
That means there were at least 1,400 homes sold overall that puts 2008 among the top five home sales years of overall transactions in Manteca during the past 24 years.
While single family home starts are at a 14-year low, there actually were more housing units built in Manteca than in any of the last four years.
That’s due to three senior housing projects being completed— the 114-unit Prestige Senior Living off East Louise Avenue, the 98-unit Commons at Union Ranch on Union Road and an additional 40 subsidized senior housing units as part of the Almond Terrace projected on North Union Road. Altogether, 471 housing units were started in Manteca last year with 223 being single family homes.
There are signs that the new home market in Manteca is slowly recovering as the square footage of new homes are getting bigger.
There were seven permits issued for single-family homes in Manteca during December. They averaged 2,894 square feet apiece. The average cost for labor and materials — the evaluation of the permit issued — was $181,805.
That’s a far cry from February when the average size of the 10 new homes started in Manteca was 1,577 square feet with a permit cost averaging $123,571.
It is also up from October when 17 permits were issued that averaged 2,696 square feet with an average construction cost of $169,539. There were 14 new homes started in Manteca during November with the average home at 2,412 square feet and an average construction cost — for materials and the cost of labor — at $141,121.
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