It is a common lament: Why is Manteca allowing new home construction when there are so many foreclosures?
The belief is that by more than 340 new homes selling in the past 12 months that it is helping depress the price that foreclosures are fetching. There were 1,211 existing homes that sold in Manteca in 2009.
The short answer is simple: They legally can’t. As long as builders meet all requirements needed to obtain a building permit they can legally build.
You need to ask yourself, though if you really want a government agency dictating exactly what can be built and how many units of any commodity can be produced for sale whether it is housing, cars, or cell phones. Limiting actual production of a commodity is not the same, by the way, as regulating what is sold via health and safety issues, dairy price supports or even demanding a fleet average be met for fuel economy for vehicles sold in the United States.
Yes, the government tries to manipulate the market through fiscal policies but that’s just it - tries. If you want examples of 100 percent market control by a government agency, all you have to do is brush up on history of the old Soviet Union and rediscover how ineffective Central Planning Committees really are. Personally, I prefer being able to go to a grocery store and being able to select from more than a handful of items.
And if you still think it is a good idea for government to directly manipulate housing you’ve got to be willing to accept the opposite which is the government intervening to drive down housing prices when they start pricing people out of the market. Of course, that wouldn’t be fair because the government would be taking away “gains” made through equity.
Then there are the actual market dynamics as they now stand. There has continually been between 160 and 230 resale homes for sale in Manteca during the past two years-plus. At the same time, over 2,910 existing homes have been sold in the past 30 months through the Multiple Listing Service alone.
During the same time period there were close to 550 new homes sold in Manteca. Almost all were bought by people who probably wouldn’t seriously consider a foreclosure. At least 30 percent were buyers of Del Webb at Woodbridge homes. There is no product in the foreclosure market that approaches what you can buy into at Del Webb if you’re 55 years or older.
On a practical basis, the new homes represent new residents which in turn represent additional consumer dollars which in turn keeps people working and stores open. People buying new homes haven’t just moved out of foreclosures.
There are also people employed in the construction trades. With Manteca unemployment at 14.1 percent and the San Joaquin County jobless rate at 16.2 percent killing off any jobs in the private sector as a means of trying to artificially support housing price is a bit self-defeating. The less people who are working, the smaller the pool of potential buyers, which in turn means lower prices when there is what now passes for as a glut of homes in Manteca. Keep in mind, of course, that the “glut” today stands at 226 existing homes for sale compared to September 2007 when there were 651 existing homes for sale within Manteca’s city limits.
Since commercial vacancies have increased putting a downward pressure on rents and leases, then shouldn’t you apply the same logic to Manteca’s allowing retail to continue building?
There are restaurants that have gone out of business as well as plenty of other places where restaurants could open that are available. So why did Manteca allow Red Robin to open and why are they allowing four more dining places to open up in newly constructed space at The Promenade Shops at Orchard Valley?
After all there was plenty of vacant space elsewhere in the city.
Of course, what was available didn’t meet the needs of the businesses that are renting and leasing just like foreclosure homes don’t meet the needs of the people who have bought new homes in Manteca.
A restaurant such as Red Robin would not open in an existing building that didn’t meet their specifications in terms of design and location.
It would effectively restrict the choices of consumers all in the name of trying to prop up the market price of commercial property.
The belief is that by more than 340 new homes selling in the past 12 months that it is helping depress the price that foreclosures are fetching. There were 1,211 existing homes that sold in Manteca in 2009.
The short answer is simple: They legally can’t. As long as builders meet all requirements needed to obtain a building permit they can legally build.
You need to ask yourself, though if you really want a government agency dictating exactly what can be built and how many units of any commodity can be produced for sale whether it is housing, cars, or cell phones. Limiting actual production of a commodity is not the same, by the way, as regulating what is sold via health and safety issues, dairy price supports or even demanding a fleet average be met for fuel economy for vehicles sold in the United States.
Yes, the government tries to manipulate the market through fiscal policies but that’s just it - tries. If you want examples of 100 percent market control by a government agency, all you have to do is brush up on history of the old Soviet Union and rediscover how ineffective Central Planning Committees really are. Personally, I prefer being able to go to a grocery store and being able to select from more than a handful of items.
And if you still think it is a good idea for government to directly manipulate housing you’ve got to be willing to accept the opposite which is the government intervening to drive down housing prices when they start pricing people out of the market. Of course, that wouldn’t be fair because the government would be taking away “gains” made through equity.
Then there are the actual market dynamics as they now stand. There has continually been between 160 and 230 resale homes for sale in Manteca during the past two years-plus. At the same time, over 2,910 existing homes have been sold in the past 30 months through the Multiple Listing Service alone.
During the same time period there were close to 550 new homes sold in Manteca. Almost all were bought by people who probably wouldn’t seriously consider a foreclosure. At least 30 percent were buyers of Del Webb at Woodbridge homes. There is no product in the foreclosure market that approaches what you can buy into at Del Webb if you’re 55 years or older.
On a practical basis, the new homes represent new residents which in turn represent additional consumer dollars which in turn keeps people working and stores open. People buying new homes haven’t just moved out of foreclosures.
There are also people employed in the construction trades. With Manteca unemployment at 14.1 percent and the San Joaquin County jobless rate at 16.2 percent killing off any jobs in the private sector as a means of trying to artificially support housing price is a bit self-defeating. The less people who are working, the smaller the pool of potential buyers, which in turn means lower prices when there is what now passes for as a glut of homes in Manteca. Keep in mind, of course, that the “glut” today stands at 226 existing homes for sale compared to September 2007 when there were 651 existing homes for sale within Manteca’s city limits.
Since commercial vacancies have increased putting a downward pressure on rents and leases, then shouldn’t you apply the same logic to Manteca’s allowing retail to continue building?
There are restaurants that have gone out of business as well as plenty of other places where restaurants could open that are available. So why did Manteca allow Red Robin to open and why are they allowing four more dining places to open up in newly constructed space at The Promenade Shops at Orchard Valley?
After all there was plenty of vacant space elsewhere in the city.
Of course, what was available didn’t meet the needs of the businesses that are renting and leasing just like foreclosure homes don’t meet the needs of the people who have bought new homes in Manteca.
A restaurant such as Red Robin would not open in an existing building that didn’t meet their specifications in terms of design and location.
It would effectively restrict the choices of consumers all in the name of trying to prop up the market price of commercial property.
