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Sonoma County is one of the debt bubble ground zeros. From up north in Healdsburg down through Santa Rosa, Roehnart Park and Petaluma there are unfinished developments, mass foreclosures and houses that would have had mortgage payments of $3500-$4500 renting for $2000-$2500.
Front page of the Santa Rosa Press Democrat today: 'A Death Valley downturn'
Steve Cochrane really nailed that one down for Moody's.
Front page of the Santa Rosa Press Democrat today: 'A Death Valley downturn'
Housing starts fell to a 40-year low in Sonoma County last year as builders halted construction projects -- and shed hundreds of workers -- in the face of the industry's worst year on record.
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Builders put up 576 houses and apartments last year, the lowest total since at least 1967, when the Construction Industry Research Board began tracking housing starts.
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Even fewer homes are expected to be built this year as developers struggle to stay afloat during a stubborn housing downturn.
The housing market now is dominated by foreclosures, which accounted for more than half of all sales in November and December.
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After selling only four homes last year at its Countryside development in southwest Santa Rosa, Ryder Homes pulled the plug on construction there for the coming year, leaving 15 vacant lots, said Dave Hunter, the builder's Sonoma County project manager. The developer, which employed 14 people in Sonoma County two years ago, now has only one person in the county.
"Right now we have no plans to build there in 2009," Hunter said. "We can't build a home for what we would sell it for now. Until all the foreclosures are done, no one knows what the market will support."
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Banks and sellers trying to avoid foreclosure are unloading houses, often at prices at less than $350,000 -- a staggering 43 percent below the peak of the last housing boom.
Only the least expensive new homes can compete, and builders are reluctant to go lower after already cutting prices 30 percent to 40 percent over the past three years.
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"There's very little incentive for home builders to go out and build," said Steve Cochrane, a Moody's Economy.com regional economist who tracks Sonoma County. "A year ago, I wouldn't have thought it would be this weak. These numbers have stopped surprising me now."
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Several builders have auctioned off homes in Sonoma County, the first since the last housing slowdown in the mid-1990s. Some have rented homes either because they didn't sell or to generate income to pay off construction costs.
Developers with homes on the market have cut prices and dangled incentives, such as paying closing costs, to draw buyers in a declining market.
Rivendale Homes, for example, is selling homes at its Woodbridge project in northwest Santa Rosa for $299,000 -- homes that once sold for $425,000, the least expensive it offers. Across town, Rivendale's most expensive homes sell for $424,000, compared with $600,000 before the housing slump took hold, said Chris Peterson, co-owner of the company.
[..]
Builders put up 576 houses and apartments last year, the lowest total since at least 1967, when the Construction Industry Research Board began tracking housing starts.
[..]
Even fewer homes are expected to be built this year as developers struggle to stay afloat during a stubborn housing downturn.
The housing market now is dominated by foreclosures, which accounted for more than half of all sales in November and December.
[..]
After selling only four homes last year at its Countryside development in southwest Santa Rosa, Ryder Homes pulled the plug on construction there for the coming year, leaving 15 vacant lots, said Dave Hunter, the builder's Sonoma County project manager. The developer, which employed 14 people in Sonoma County two years ago, now has only one person in the county.
"Right now we have no plans to build there in 2009," Hunter said. "We can't build a home for what we would sell it for now. Until all the foreclosures are done, no one knows what the market will support."
[..]
Banks and sellers trying to avoid foreclosure are unloading houses, often at prices at less than $350,000 -- a staggering 43 percent below the peak of the last housing boom.
Only the least expensive new homes can compete, and builders are reluctant to go lower after already cutting prices 30 percent to 40 percent over the past three years.
[..]
"There's very little incentive for home builders to go out and build," said Steve Cochrane, a Moody's Economy.com regional economist who tracks Sonoma County. "A year ago, I wouldn't have thought it would be this weak. These numbers have stopped surprising me now."
[..]
Several builders have auctioned off homes in Sonoma County, the first since the last housing slowdown in the mid-1990s. Some have rented homes either because they didn't sell or to generate income to pay off construction costs.
Developers with homes on the market have cut prices and dangled incentives, such as paying closing costs, to draw buyers in a declining market.
Rivendale Homes, for example, is selling homes at its Woodbridge project in northwest Santa Rosa for $299,000 -- homes that once sold for $425,000, the least expensive it offers. Across town, Rivendale's most expensive homes sell for $424,000, compared with $600,000 before the housing slump took hold, said Chris Peterson, co-owner of the company.
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