Foreclosures have significantly changed the face of Manteca neighborhoods.
The mortgage crisis has resulted in one out of every four existing homes in Manteca - 5,822 - being sold since 2008. All of those homes sold for significantly less than the market peak in 2006 when the median closed escrow price for existing homes reached a record $413,000.
That, however, only tells one side of the foreclosure story of people being forced to sell or losing their homes. Realtors note a slight majority of the buyers of the 5,822 homes are people who work and reside in the valley and could only afford to rent in the once red-hot housing market. At the same time, the amount of homes bought by investors has soared.
It is a complete flip of eight years ago when almost all home buyers were coming from the Bay Area in search of affordable housing. There were also few investors buying homes in 2004.
The silver lining of the foreclosure mess that triggered the housing market collapse is affordability. Economists contend housing is affordable when it doesn’t exceed more than 2.5 times an area’s median household income. In Manteca, the median price of a home in 2006 was 7.5 times the median household income. Median household income in Manteca in 2009 based on state Department of Finance figures was $61,315. Median housing prices in 2012 were at $190,000. That translates into housing prices being 3.1 times more than annual income.
Last year, in retrospect, may have been the turning point in the housing recovery.
There were 1,092 existing home sales within Manteca’s city limits in 2012. That marked the fifth consecutive year of 1,090 plus homes being sold.
And while prices were generally flat during the first half of 2012 with a median of $176,000, the market started taking off in July with the last six months of the year showing sales with a median value of $203,000. The $27,000 jump reflects a 15.3 percent increase in value. The overall median value of homes sold in Manteca during 2012 was $190,000.
Sales to date in 2013 reflect a continued upward pressure on prices. And while that is a good sign, prices basically are at the same level they were in 2000.
The least expensive existing home to sell in the Manteca area in 2012 went for $23,000. The most expensive sold for $765,000. It was country property with a home north of Manteca. Even so, it is a significant jump over 2011 when the most expensive property to sell in the Manteca area was $460,000. Only 15 homes out of 1,092 that closed escrow last year sold for more than the 2006 Manteca median price of $413,000.
The housing segment that suffered the biggest collapse in Manteca over the past six years is the McMansions.
The bellwether in Manteca for McMansions is the huge rectangular boxes Seeno Homes built with three-car garages and 4,336 square feet of living space in the Heritage Ranch neighborhood south and east of Joshua Cowell School. Seven years ago, the 4,336-square-foot Seeno homes hit a record high $750,000 for a tract home. In 2009, escrow closed on one of the McMansions on Vasconcellos Avenue for $230,000. That reflects a 69 percent plunge in value.
Such bargain basement prices don’t even reflect the replacement cost of the house, land and improvements such as water and sewer infrastructure
While Manteca has been selling an average of 1,174 existing homes annually for the past five years, new home sales have averaged 280 a year since 2008. That is significantly higher than in Stockton and Modesto.