The pandemic isn’t likely to slow growth much in Manteca and Lathrop.
And even if a recession hits as expected due to decisions to place much of the economy on ice in a bid to flatten the impact of the coronavirus, developers that have dealt with the greater Bay Area market for 30 years expect any retraction in the housing sector to be significantly less painful than the aftermath of the 2008 mortgage crisis.
Manteca’s housing starts are running almost 29 percent above 2019 levels when 533 single family homes were built in the city. That is based on city permit data that includes a week when the city shut down completely and the last three working days of March that the city was back to accepting building permits.
During those three days the city accepted application for permits to build 10 new homes entered into contract after the pandemic stay at home orders were issued. That included five permit applications submitted on the last day of the month.
In Lathrop, the pandemic didn’t stop three families that had never stepped foot on River Islands let alone inside the model homes offered by seven builders from entering into purchase contracts complete with deposits over the weekend.
That came on the heels of 13 homes behind sold last week. In those instances the buyers had all toured the homes previously before closing deals online.
“It is amazing,” noted River Islands at Lathrop Project Manager Susan Dell’Osso of the sale of three homes sight unseen that was conducted 100 percent over the Internet using virtual tours connected with Facetime to sales representatives to walk through models and the using online communications to seal deals.
Construction and new home sales both fall under Gov. Gavin Newsom’s essential services. Social distancing still comes into play. That means open houses, model home or resale housing tours, and in-person transactions are banned.
Manteca was the fifth fastest growing city among those over 30,000 residents and the 14th fastest growing overall in 2019 according to state Department of Finance data. That translated into a 3.4 percent growth rate to add 2,759 residents. The numeric increase in residents was the 9th biggest in the state.
Lathrop was the 7th fastest growing overall in California. The city grew by 5.17 percent by adding 1,258 residents.
Dell’Osso, who has been working on housing developments for Cambay Group for over three decades in the Bay Area through the 10,000-plus home Dougherty Valley project in the East Bay and now the 11,000 plus home endeavor at River Islands, noted Lathrop-Manteca offers new single traditional family homes that are under $600,000. Both new single family homes as well as new homes under $1 million are a growing rarity in the Inner Bay Area.
More government data from FHA loans to those involving megaregions now classify all — or at least a large chunk — of San Joaquin County as being part of the Bay Area. The South County communities of Manteca, Lathrop, Tracy, and Mountain House are part of that “large chunk.”
Among the reasons why the demand for housing — specifically traditional new single family homes and apartments — is not expected to cool much due to the pandemic and pending recession in the South County market centered around Manteca-Lathrop:
*Job growth is still expected to outstrip housing growth in the tech heavy Bay Area.
*There are essentially only a few pockets for new single family home subdivisions in the East Bay. And where they are, homes under $1 million are non-existent.
*The South County, on average, is 40 percent more affordable for housing across the board than in counties west of Altamont Pass.
*New homes are preferred by many upwardly mobile families plugged into telecommunicating as most models have dedicated home office space for that purpose.
*Manteca is well positioned with wastewater and water capacity with Lathrop not far behind.
*A growing trend to for tech employees to work several days at home is expected to accelerate in the aftermath of the pandemic making the commute less burdensome.
*Altamont Corridor Express trains will be expanding service thanks to the deal that allowed the increase in gas tax.
To contact Dennis Wyatt, email firstname.lastname@example.org