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Is the 44.6% gain in value of Manteca homes for real?
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The median price of existing homes closing escrow in year-to-year comparisons is up a whopping 44.6 percent in Manteca.

Trulia and RealtyTrac put the median selling price at $289,250.

At first glance it looks like the Manteca housing market as well as the rest of the Northern San Joaquin Valley is so hot its going nuclear.

As much as you can bank on the $89,250 increase over the median of just a year ago as being solid, it doesn’t really reflect reality for a large segment of the nation’s housing market.

That’s because a lot of the hot spots today are in areas that were part of the bubble that burst the biggest. It is reflected in the fact 17 of 20 of the hottest markets today are west of the Rockies including 12 in California.

And nowhere else did values plummet as far as they did in the Northern San Joaquin Valley where prices plunged 59 percent off the historic high of $429,000 reached in 2006.

To better put it in perspective, prices are up $113,750 over the low point reached in 2010 when the median dipped to $175,000. Even with a 44.6 percent gain in the last year to $289,250 we still have roughly $139,000 to go before all losses in value are restored.

It doesn’t take someone with a PhD in economics to understand what is happening in Manteca, Turlock, Modesto, Stockton, Ripon, Lathrop, Mountain House, and Tracy.

The region will have the biggest gains because we had the biggest losses. That will happen thanks to the pressure the tight housing in market the job-rich Bay Area economy is exerting on the Northern San Joaquin Valley.

If the percentage gain of the last year was cut in half, all lost value would be recouped within three years.

Whether it happens that quickly has a bit to do with the economy.

One thing is for sure. There are still price gains on the horizon. That’s due to the fact bulk of the existing housing inventory hasn’t quite recovered replacement costs.

In other words, you cannot duplicate a home’s square footage, basic amenities, the cost of the land and infrastructure for $289,250 in Manteca and probably not in most Northern San Joaquin Valley cites.

Short of a severe economic retraction, prices will come back up to the replacement cost level at the very least.

That means the odds of a buyer waiting on the sidelines to see if prices will start retracting isn’t a wise strategy.