From the Editor
In southern California, where I reside, a recent report shows the average price of new homes detached, single-family houses has gone up $140,000 in the past two years. That increase is more than the average price of a new home in many states. The prices in San Diego County have increased 20 percent in a year.
A second scary figure is that the average mind you, average price of a new detached, single-family house in San Diego County was $532,000. In an area along the coast, represented by familiar names such as Del Mar, La Jolla and Encinitas, the price is an astounding $852,000.
The report also noted that the "affordable home," which in this area seems to be sub-$200,000, is no longer available new. The average price of new condominiums in the county is $337,000. There was no average price given for new doghouses, but I suspect they would be in the same range we tend to build large dog shelters around here.
Down the block from us, a new development is going in and it is screaming from large billboards that the new homes being built there will be "in the mid-$260,000s." The fine print discloses that this is for a 1,350 sq ft townhouse, four to the building. The billboard is easy to see as it, and the development, butts up to a major expressway with 65 mph traffic day and night.
And the buildings, as you would expect, are wood framed with plywood sheathing, eventually to be covered with stucco, I assume. Which means those "lucky" homeowners snuggled in their expensive nests won't hear all of the noise from the semis and other trucks that use these connectors between Interstate 5 and Interstate 15. Not all, but I know they will be hearing a lot of it.
You would think, with the soft economy most of the country is experiencing, these prices would be turning people away by the busload. Guess again. The first nine months of 2002 saw 9,606 houses and condos sold, surpassing the 9,417 sold in all of 2001. Russ Valone, president of MarketPoint Realty Advisors, the authors of this report, is quoted in the local newspaper saying, "For anything in the sub-$400,000 range, you've got people lined up to buy."
If you are wondering why masonry isn't in demand around here for residential building, I suggest you ask, "Why would the builder choose solid, noise-dampening masonry construction when they can 'throw up' frame and stucco buildings almost as fast as people seem to want to buy them?"
But of course, this is California. Mind you, it is not Silicon Valley, where the dot-com boom blew up and retail rentals are staying empty; not San Francisco, where the loft market is still hot but most everything else is not; not even L.A., of which market "the less said the better." This is an area where the military is probably the major employer, where hi-tech is hard to find, and where people are suffering from layoff and companies going under.
How are these builders finding buyers? Where will those buyers work? How will they pay those mortgages, even with the admittedly low rates being offered today?
My wife made the comment, "We are not sitting on a goldmine, we are living in our retirement." Now, when the "k" in 401(k) often stands for "kaput," the stock market is giving traders and small investors both motion sickness, and war is on the horizon, is the age-old need for a piece of land as a comfort zone coming back into vogue?
At any price?
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