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Mountain House: Nothing more than a big subdivision in middle of nowhere
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Developers bragged Mountain House was “The Town of Tomorrow” when they broke ground at the dawn of the 21st century on the new community on the edge of the rolling Altamont Hills in western San Joaquin County.

It did turn out to be the “Town of Tomorrow” but not as developers envisioned.

Eighty-nine percent of the mortgages in Mountain House is ”underwater”. That means the homes are worth less in terms of market value than their outstanding loan balances. That makes it the undisputed national champ when it comes to ravages of the subprime mortgage mess. By comparison, 35 percent of the homes in California are underwater compared to 24 percent nationwide.

Its defenders will say that the high underwater mortgage is a reflection of it being an entirely new community with everyone having a mortgage, but that does not wash.

Mountain House backers won a competition in the 1990s where the Board of Supervisors basically said they were willing to create a new community out of the countryside in a bid to address affordable housing needs and to meet housing demand. Of all of the proposals - including New Jerusalem in the middle of farmland southwest of Tracy and one on the San Joaquin side of the Stanislaus River directly across from Riverbank - Mountain House was the least intrusive on agriculture and closest to the employment centers in the Bay Area.

Planners believed they could create a perfect city from scratch with employment centers, retail, and community facilities clustered near housing. They also believed it would bring affordable housing in the $200,000 to $300,000 range to the western edge of San Joaquin County.

The first homes sold new for almost $400,000 and quickly soared past the $500,000 mark and were pushing $825,000 before the housing market collapse.  There is no retail save for one convenience market and the employment center is nothing more than a pipe dream.

Yes, the mortgage meltdown has played a big role in Mountain House’s precarious situation just like it has elsewhere in California. There is, however, one big difference. Mountain House was purely market driven despite all of the chest puffing by former county leaders and developers that somehow it would be different.

Mountain House, in short, is a monument to unsustainable urbanization.

Its profitability - and therefore its business plan - was based on the standard conversion of raw land into five homes per acre with traditional housing. Instead of appealing across the board of housing types, they concentrated on what was driving the market - people eager to buy McMansions either the super-sized or smaller versions.

There really was no effort to put affordable housing in place. It was one huge push to cash in on the housing frenzy.

There were promises made with Mountain House that were ringing empty long before the mortgage meltdown.

It is painfully clear that the county should not be in the business of encouraging residential developments of any consequence outside of city limits. If you doubt that, just look at East Modesto, East Sacramento and the countless other instances in California where urban development in county jurisdictions outside cities have essentially led to the creation of unbridled sprawl minus the urban amenities one would expect with fairly dense housing.

It will be a long time, if ever, before Mountain House can start living up to its promises.
It would have made more sense to work with Tracy to develop a similar-size project on its flank.

But given the original “create-a-city” derby including seven sites throughout the county that developers had tied up through options, it was less about wise planning than it was about creating opportunity for developers.

San Joaquin County leaders backed off on several sites - including one near Lockeford, when the state made it clear they would not help widen freeways between new cities that could rival Tracy or Manteca in size and the job-rich Bay Area. In fact, as then State Sen. Pat Johnston astutely pointed out, such locations defeated the entire purpose of creating a sustainable new city.

An argument can be made that places like Mountain House should go in terrain where it is located as it is generally inhospitable toward high production farming. There must, however, be planning and a location that is capable of attracting a variety of uses necessary for a vibrant economy and community.

River Islands at Lathrop is a prime example of smart planning.

You do not build a new community in the middle of nowhere away from major transportation, major employment, and without amenities in the belief “it will come.”

Settlers in the valley learned 150 years ago that without one of the three, a new community would soon stagnant or perish.

You can’t ignore the forces of the long-term market and thrive nor can you let development be driven by the short-term market.

The long-term market is based on sustainability. The short-term market is based on quick profits.

Mountain House’s backers said they were dreaming long range but when push came to shove all they did was build as many houses as they could as quickly as possible to cash in on profit before the bubble burst.