LAKE COUNTY — After the real estate bubble popped, big and rapid declines in property values in the Bay Area saw homeowners and developers gobbling up real estate. But the real estate story is a little different in Lake County. Real Estate agents say the buyer profile hasn”t changed much throughout the real-estate rollercoaster ride.
During the past seven years, a high rate of home sales at high prices was followed by a leveling out in sales that then dramatically slowed along with a drop in prices.
The county has long been known as the last near-to-the-Bay-Area location with affordable housing. “We”re still seeing everything as we used to. We”re looking at the first-time home buyers, people in transition into smaller or larger homes and vacation lakefront?but those homes going into escrow are just a battle to get closed,” City Center Realty owner and broker Byron Whipple said.
With no more jumbo loans, requirements to get a loan have tightened up: good credit and a down payment are necessary in order to get a good interest rate. As part of an economic stimulus plan released this month, the Federal Housing Association (FHA) bumped loan limits in Lake County up to $401,250 from the previous limit of $321,000.
“But the conventional, non-government loan stayed at $417,000,” Fountain Grove Mortgage Branch Manager Susan Kind said. Neighboring Sonoma County”s loan limit rose to just over $650,000, and San Francisco”s is up to almost $730,000.
Spurred by the bleak housing market, the overall economy is in recession, with unemployment in the county at 9.6 percent last month, up from 9.4 percent a year ago. That ranks the county 36 among the state”s 58 counties, 1 being the best and 58 the worst.
Area real estate agents and lenders say that many working and middle-class families, the back-bone of the county”s working economy ? are moving out and less are moving in to the area. But there has been a slight increase in people purchasing land to stow away for future building. And there seems to be a group of people with enough money who remain “sheltered” by the dire economic situation who continue to purchase the most high-end lakefront properties in the county, Whipple said.
Robert Dunk of Coldwell Banker Town and County said he”s optimistic for the future, although many agents are supplementing income by taking on other jobs or quitting until the market recovers.
“I”m optimistic because this is still a huge retirement area. People who are getting ready to retire are probably going to come to Lake County. Some want to work a little longer and some want to get out of the congested areas, so this area is always going to be attractive to them,” Dunk said.
The median home price for the last month according to data from the Lake County Association of Realtors was just over $200,000. “It”s still more affordable to buy property here than almost any other county in the state,” Dunk said.
Rick White, a realtor with Konocti Realty said most properties are less than $300,000, with many closer to $100,000 and less. White, along with Dunk and Whipple agree that sales have been sluggish since things slowed down from 2005-2006.
“The funny thing is prices continued to rise, then in 2007 things leveled out. Now things have dramatically slowed and prices are dramatically dropping and the numbers of transactions are dropping,” Whipple said.
“Overall the economy is affecting everyone. The excess income isn”t there right now. That vacation home the buyer could have afforded a few years ago they can”t afford now,” Whipple said.
Former real estate and lending agent Monna Hull got out of the business after eight years. Because of sub-prime loans that let buyers finance 100 percent of the home, about 28 sub-prime lenders declared bankruptcy or merged. Because of high debt and low appraisals, it was “just horrible for me to have to say no to people I”d had a business relationship with for so long,” Hull said of trying to help her former clients re-finance homes.
“I was just struggling and couldn”t make it, so I quit,” Hull said. “I”m working at the Culinary Institute of America in St. Helena?it was just financially the best thing for me to do. It”s a lot less stress,” she added.
Contact Elizabeth Wilson at ewilson@record-bee.com.
