by Pops » Tue 23 May 2006, 10:18:55
$this->bbcode_second_pass_quote('On July 5, 2004 I', ' ')Today small acreages many miles from large urban centers have great upward price pressure as commuters want more land at lower prices and are willing to drive daily to get it.
… As the cost of fuel escalates and the value of bedroom community real estate tanks…
Man, my crystal ball was on the right channel in this instance, but then again I was living in what had become one of those bedroom communities just down the road from Stockton.
The deal about the central valley wasn't that people just wanted to own a house – they wanted ever-bigger houses. I did work for a fairly large developer out there (they built some homes in developement mentioned in the article) and one of their best sources of new buyers were people who had bought new homes from the company only 2 years before and wanted to trade a longer commute for a bigger house!
I personally met people who first moved to Livermore (20 mi commute 1-way) then as it appreciated, sold and moved to a larger house over the hill in Tracy (40mi C1-W) repeat to an even bigger house in Stockton or Modesto (80 mi C1-W ).
We sold our 1-acre and 1700sf house outside Modesto in September of ’04 after it had appreciated over 250% in about 5 years and got out of that mess.
I am amazed the run lasted this long; talk about converging storms:
The typical 15-year (+/-) real estate cycle (not surprisingly, related closely to the age of the average 30-something-and-can’t-remember-the-last-bust-home-buyer),
The .com boom and bust that drove RE prices crazy in the Bay,
The super low gas prices during the '90s,
The large percentage of people commuting from the valley,
And, of course 9/11 scared some into moving to what they felt was the relative safety of smaller towns
This was inevitable even without the run up in gas prices.
We still have family and friends out there, a few that are invested in rentals, and one or 2 that are thinking about moving out here - they are seeing their big windfall evaporating in front of their eyes.
One of those cases where 'I told you so' isn’t much fun.
The legitimate object of government, is to do for a community of people, whatever they need to have done, but can not do, at all, or can not, so well do, for themselves -- in their separate, and individual capacities.
-- Abraham Lincoln, Fragment on Government (July 1, 1854)