A growing number of two-bedroom, one-bathroom apartments in the more popular complexes in Manteca that were renting for under $750 just a year ago have now topped $800 a month.
At the same time some two-bedroom apartments are heading past the $900 mark although they have a way to go to reach the upper echelon of Manteca apartments - Paseo Villas on Atherton Drive along the 120 Bypass - that just has hit the $1,185 a month mark for a two-bedroom apartment. That’s significantly more than the house payments of a number of folks who weren’t afraid to buy existing homes in Manteca during the past three years.
Surprised? Don’t be.
Even with the housing boom followed by the housing bust, California - especially growth areas such as the South County - still has a housing shortage. It has been hidden somewhat by economic trepidation that has also created a situation where more than one generation of families live under one roof.
And if you don’t think the Manteca housing market is showing early signs of heating up consider this: Paseo Villas since it opened in 2005 has never increased the rent for a one-bedroom, one-bathroom apartment. It has been a constant $995. Those apartments are now renting for between $1,010 and $1,135 a month. That’s right, $1,135 for a 735-square-foot one bedroom and one bathroom apartment. And while it is indeed an upscale unit that is just $45 less a month than I’m paying for an all inclusive mortgage including escrow impounds for a 995-square-foot home I bought four years ago when the housing market was going downhill. Take away insurance coverage for loss (there is no renter’s insurance tacked on to the monthly cost quote for Paseo) while keeping the mortgage insurance and property taxes in the equation, I’m actually paying $1.23 less per month than I would for a one bedroom at Paseo.
People who were told they were nuts to buy over the past four years don’t look so crazy, do they?
But more important, increasing rents is a clear early warning signs that the market is stabilizing. It means there will be upward pressure on home prices soon. While you shouldn’t expect huge jumps in value, it will be enough of a trickle to start whittling down the window of opportunity that many have to be able to afford to become homeowners.
The $1,135 question: Should you buy?
While there is more attached to the answer than just monthly housing costs, if you harbor any thoughts of home ownership but have been “waiting” you’d best stop waiting unless you want to be at the mercy of rent hikes on a living space you don’t own.