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New home building pace triples
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The pace of residential building tripled during April in Manteca with developers starting 37 new single homes.

It is a significant jump from the past five months that have seen between 10 and 13 new homes started. The 37 new homes started in April eclipses the 35 started in January, February, and March combined. It brings the year’s total to 72.

Last year there were 239 single family homes built in Manteca.

New home builders are crediting three things for the uptick in new home sales:

•The $8,000 first-time buyers federal tax credit that is good for any home that goes into escrow by Dec. 1 of this year and as long as the buyer hasn’t owned a home in the previous three years.

•The $10,000 state tax credit for buying a brand new home.

•The lowest prices in more than a decade.

Builders also reported a significant increase in traffic as, more and more people qualified to buy homes up to $280,000 are getting frustrated with the resale market’s competiveness and lack of an inventory of homes in move-in condition to choose from. It also helps that virtually every builder has the most of their models starting under $300,000 which means they also qualify for FHA loans.

Even if newer homes may push them closer to their comfort limit, sale associates in new developments report buyers are realizing that a new home that may cost $$10,000or $15,000 will be in turn-key condition compared to many short sales and foreclosures that need extensive work such as new roofs in addition to cosmetic issues.

There was an eight-year period in Manteca when there wasn’t a builder offering a home affordable enough for someone using an FHA loan that has loan limits.

Helping drive more traffic to new homes in Manteca as well is the shrinking resale inventory.

There is only a large enough supply of homes Manteca to satisfy the current buying pace of 121 homes a month for the next six weeks.

As of last Monday the 188 homes available in Manteca included 44 foreclosures and 83 short sales. The rest of the homes for sale are not under duress. There are also 220 pending sales in the works.

The standing inventory of resale homes within Manteca’s city limits reached a historic high of 651 in September of 2007. By January of this year, it had dropped to 376. It has dropped almost in half just four months into 2009 thanks to the number of active buyers who are helping absorb many foreclosures faster than they hit the market.