Residential Real EstateWild, Wild West: Housing Mother Lode Drained In Golden State
It"s a lot like dusty prospectors packing up and leaving a mother lode of gold that"s been tapped out.
The massive home building shortfall in California has sparked an exodus of homebuilders leaving regions that were once housing boom towns.
California home builders have long held that the state needs 250,000 new homes every year to keep homes affordable.
This year, however, they plan to produce a paltry 79,000 new homes -- fewer starts than in any year since 1954, according to the California Building Industry Association.
But California housing has become more affordable anyway.
That"s because housing woes have left California as one of the nation"s hardest hit states when it comes to foreclosures, tight credit, home sales declines and subsequent dips in home values.
New single-family home starts are down from 55 percent from a year earlier, the association reported. Actual production for the first quarter was off more than 48 percent.
And at least one builder president and CEO, Don Tomnitz with D.R. Horton, recently told the Associated Press conditions for the new home market are not likely to improve until 2010.
Some of the woes are being exacerbated by the fear of buying in a market where home prices could decline further.
However, as the value of California"s once golden new home market diminishes, brave buyers are finding a silver lining.
The California Association of Realtors (CAR) recently reported 44 percent of the state"s households could afford to buy an entry-level home during the first quarter this year.
That"s almost double what it was a year ago, at 26 percent.