Building back in the area – Ceres Courier

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Home building has been dormant for years in Ceres, but the industry is expected to restart in small increments as existing home prices continue to rise.

Home inventory is extremely low in Ceres, which means the highest prices ever. As an example, a four-bedroom, three-bathroom home in the Eastgate neighborhood of Ceres sold for $200,000 in 2010, or $65 per square foot. It resold in October 2017 for $399,500. Today, the same house could fetch between $675,000 and $692,000.

Things have been so slow at Ceres that the Planning Commission has canceled five of its eight meetings scheduled for this year; and canceled 12 of its 24 meetings in 2021. Across the country, housing starts have not kept pace with population increases with COVID-19 and government restrictions having a lot to do with it.

The Wall Street Journal recently reported that supply chain backlogs are causing massive delays in new home construction across the country and driving prices to record highs. Garage doors became so rare in Sacramento late last year that city officials began allowing builders to close homes with temporary covers.

Housing market research firm Zonda surveyed homebuilders in November and 90 per cent said the supply disruption was affecting them, causing a ripple effect of rescheduling crews already decimated by a shortage of qualified workers.

Building material costs have also skyrocketed. In 2021, lumber prices soared to over $1,600 per thousand board feet. When COVID hit, sawmills closed or slowed due to worker illness and government shutdowns. The industry also cut production, thinking demand would slow like other sectors, but construction of new homes has not slowed.

Demand for construction and insufficient supply have led to price spikes. This time last year, the National Association of Homebuilders found that it cost more than $36,000 more for a new single-family home.

Prices eventually fell last year, but since November lumber prices have started to rise again, almost back to where they were a year ago.

Things can only get worse. A Feb. 8-28 poll of 33 real estate analysts suggested U.S. home prices would rise 10.3% this year. This was an improvement from 8% in the December survey, suggesting that underlying housing demand is still strong and housing supply is still tight. Prices are expected to rise 5% in 2023 and 4.1% in 2024.

“The recent pace of house price increases is clearly unsustainable,” said Brad Hunter, head of independent consultancy Hunter Housing Economics, who expects just under 8% house price inflation. this year, followed by 4.1% in 2023.

Rising interest rates should dampen demand for home purchases.

“While buyers remain interested and eager to buy homes, mortgage rates are already heading towards 5% and starting to limit their ability to qualify for a loan,” said George Ratiu, senior economist and head of research. economical at Realtor.com.

Ceres has not seen substantial housing starts for several years. Only 17 permits for new houses were granted last year in the city of Ceres. Only five of them passed the final inspection.

But home construction will begin to resume this year in the specific plan for the 94-acre Whitmore Ranch south of Whitmore Avenue near Cesar Chavez Jr. High School. No homes have yet been built since its annexation in 2019, however, two subdivision plans have been approved. The first, approved in May 2021, subdivides 19.3 acres into 107 residential lots. The second was approved on March 21. The applicant proposes to subdivide 8.4 acres into 46 residential lots just east of Moore Road and 650 feet south of Whitmore Avenue.

Grading, sewer and water lines and road infrastructure for Whitmore Ranch’s first 107-lot subdivision is scheduled to begin in June. However, the developer has yet to submit the development plan which will be reviewed by the Ceres Planning Commission which will review the architectural designs and location of the houses.

Additionally, homes are expected to be built in the 38-home phase two at Cambridge Estates, an 8.26-acre site at 1200 and 1206 Hackett Road. The project site is surrounded by residential uses to the west, south and east, with Strawberry Fields Park and Sinclear Elementary School to the north.

Olive Villas, an 18-home development on Hatch Road adjacent to Olive Wood Business Park, is also approved and ready for construction.

No construction projects have been proposed for the West Ceres annexation area in southwestern Ceres, nor has any activity been carried out in the lots approved years ago for Copper Trails and Maple Glen.

Construction also goes to Keyes. Bright Homes is preparing to build 64 homes on the 13.2-acre Keyes 19 North Subdivision located at 4713, 4805 and 4707 Norma Way between Lucinda Avenue and Norma Way. The subdivision was approved by the Stanislaus County Board of Supervisors in 2016 and extended twice.

Keyes 19 South, located on 6.7 acres west of Washington Road between Norma Way and Nunes Road, will result in 27 single family homes.

Interest in building houses in Modesto is also showing. Recently, the Modesto City Council decided to move forward with two annexation proposals for more housing in Southwest Modesto, with Councilwoman Rosa Escutia-Braaton saying housing “is the biggest problem that is most often brought to our attention”.

Council has agreed to proceed with the Modesto Urban Area General Plan Amendment to designate approximately 23 acres of Fairview Village in South Modesto as a Residential Village from its current business.

Additionally, the City of Modesto wishes to annex 177.75 acres of land east of Carpenter Road and north of Whitmore Avenue. The property is part of Fairview’s Specific Plan first adopted in 1995.

Mike O’Hara, director of forward planning at Tim Lewis Communities, approached the city to develop approximately 38 acres into a single-family home development with 217 lots. He hopes that construction can start at the end of 2023.

Like hidden taxes affecting the cost of gas at the pump, fees charged to developers make homes less affordable in California.

According to Christopher Hoem, director of community development for the town of Ceres, the permit fee to build a home in Ceres — including all city, county and school district fees — adds $54,000 to the cost of a home. home.

The state requirement to install solar power on every new home built in California adds about $10,000 to the cost of a home. The California Energy Commission (CEC) estimates that adding solar energy increases the average monthly mortgage payment by $40, but notes that new homeowners will save an average of $80 per month on their heating, cooling and utility bills. lighting.


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