The ante has been upped in the Northern San Joaquin Valley housing market.
River Islands at Lathrop starts selling homes today.
Make no doubt about it. Cambray Group will build 10,800 homes in the next 25 years. The 11,000-acre planned community represents an investment of 25 years so far and well over $200 million. And this is not Somerston Holdings’ — the parent company of Cambray Group — first rodeo with a mega planned community in California. They spent nearly two decades getting an 11,000-home project from conception to completion in the Doughtery Valley south of Concord.
It was clear a long time ago that Somerston Holdings was in this for the long haul investment. And now that they are selling homes finally it will trigger a seismic shift in the housing market.
That doesn’t mean other builders and communities will suffer by having the equivalent of a 900-pound gorilla in the Northern San Joaquin Valley.
The one thing Somertson Holdings doesn’t want to do is devalue its investment. That is why they refrained from moving forward when everything was in place just as the recession hit. It is why they sat for five years on over $200 million of completed infrastructure and other investments.
River Islands at Lathrop will serve as a gigantic magnet to draw even more people over the Altamont Pass in search of affordable housing as well as a lifestyle.
And it’s not just because of the incredible investment in amenities such as manmade lakes, cutting edge schools, or the commitment to universal river access, developing an employment center and the creation of a unique town square on the river’s edge.
River Islands at Lathrop represents the biggest development in a position to build now and to serve those getting squeezed in the Bay Area housing market as the tech rebound continues to gain strength.
It takes five years for a typical California subdivision to go through the permit process, environmental studies and get infrastructure in place. River Islands doesn’t have to worry about that any longer.
The projection is for 90 homes to be built this year, 250 in 2015 and then 500 a year after that.
The fact River Islands is a 900-pound gorilla will result in a spillover effect. One of the reasons why Atherton Homes and Woodside Homes did so well selling homes in Union Ranch at the depth of the Great Recession was the fact they were next door to Del Webb at Woodbridge.
Del Webb has a huge pull on well-situated buyers. And those that didn’t quite like the Del Webb concept but fell in love with the area more often than not bought right next door in Union Ranch. Many adult children of Del Webb residents did the same.
River Islands will get more people thinking about heading over the Altamont Pass. They will have a coattail or ripple effect on the rest of the housing market.
That would be good for builders but what about existing homeowners.
If Dougherty Valley is any indication, healthy home appreciation will be returning as often times those looking for a new home will check out the local resale market and find gems that catch their heart and their mortgage dollars.