New home sales are not being sidelined by the pandemic.
Builders at River Islands at Lathrop sold 13 homes this past week with all of the sales contract documentation being done online.
Raymus Homes in Manteca have sold five homes in the past two weeks since the pandemic was declared.
A spot check of new home builders elsewhere in Manteca shows a similar trend.
All of the buyers had previously toured models and made the decision this past week to go ahead and enter a purchase contract. At the same time there has yet to be buyers that have sought to break existing contracts for homes already under construction.
Sales of existing homes have taken a hit — for now — as agents report a number of buyers wanting to further assess how the economic implications unfold.
The difference between new homes and existing homes as far as how they are being impacted appears to have everything to do with the jobs the buyers have as well as social distancing rules. Even though it is arguably the sudden and deepest shuttering of a large segment of the economy, it is not initially unfolding as a repeat of the Great Recession. Unlike the last downturn that hit in 2008, the fallout is not universal and is targeted at specific job categories. Today’s mortgage rate is 3.25 percent compared to 6.17 percent in 2008 making loans significantly cheaper.
Those placing deposits on new homes at River Islands and in South Manteca — both are ground zero for new housing growth in the Northern San Joaquin Valley — include a large number of tech workers and those employed in health care fields. Neither segment of the economy is taking a hit in the pandemic to the point their jobs are in jeopardy.
Working in favor of the new home sector are carves out in Gov. Gavin Newsom’s shelter in place order. Construction including that of housing has been deemed an essential service. While model homes have been ordered closed, builders have switched to tours by appointment only.
Before potential buyers arrive all standard touching points are sanitized and doors are left open with social distancing practiced between sales representatives and those touring models. Feedback indicates potential buyers are happy about what they consider a more one-on-one interaction.
Second generation home builder Toni Raymus as well as River Islands project manager Susan Dell’Osso repeatedly expressed concern for those impacted with job losses or reduced income during the pandemic.
Both also pointed out new homes sales means paychecks are still flowing to a lot of workers with the vast majority being Northern San Joaquin Valley residents. Raymus Homes — considered a small home builder that closes escrow on an average of three to four homes a week — has 200 trades workers engaged in building homes at any one point in time whether it is on site or off site fashioning things such as cabinets.
Every two weeks the economic activity due to Raymus homes being built and closing escrow is right around $1 million with the majority of that money going into the pockets of workers in various trades that are building homes. Trades, even though they are good paying jobs are struggling to find workers to meet the demand.
Raymus noted social distancing on the job sites is being followed.
‘We are very appreciative of how responsive the City of Manteca has been,” Raymus said.
When the city hall operations closed due to the pandemic it disrupted building inspections. The city quickly responded to get building inspectors in the field. If not it would have idled Raymus’ 200 workers.
Dell’Osso said River Islands home building partners are in the process of website virtual tours of models more muscular. There have been 1,600 homes sold far in the planned community of 11,000 with 1,200 homes already occupied.
Dell’Osso, who has 33 years working with Cambay Group, first with the 10,000-plus home Dougherty Valley development in the East Bay and River Islands since its inception, doesn’t anticipate much of a new home sales slowdown.
She noted a number of River Islands residents had already been working from home two or so days a week and commuting to tech firm jobs in the Bay Area. Dell’Osso believes the situation of many workers being forced to work from home that are employed with Bay Area firms will increase the appeal of having a home built for 21st century needs including a viable home office designed specifically for that purpose along with a lifestyle and much more affordable price points that older housing in the congested Bay Area.
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