CSU Fresno -- August 22, 2003

House Price Tags Under $150,000 Going the Way of the Edsel

2nd Quarter Housing Reports new home Increase of 14 percent over last year

The latest Quarterly Housing Report released this week by the Real Estate and Land Use Institute at California State University, Fresno confirms what most area home buyers have been encountering: new homes priced under $150,000 may no longer be available in the Fresno/Clovis area.

The Quarterly Housing Report is an ongoing research project of the institute that records information regarding new production housing for the Fresno/Clovis area.

The report also shows that the number of new home sales continues to rise in the Fresno/Clovis area, with an annual sales increase of 14 percent over the prior 12-month period; and that homes priced at $300,000 or more are on the rise.

Dr. Garo Kalfayan, market analyst of the Institute in the Craig School of Business, said that in the second quarter, no new production homes were sold for less than $150,000.

"By contrast, over 25% of new production housing sales in the Fresno/Clovis area were priced under $150,000 for the same quarter last year," he noted.

The report indicates that the number of homes with price tags of $300,000 or greater has increased dramatically. "The number of new home sales in excess of $300,000 for this quarter has tripled when compared to the same quarter last year," Kalfayan said.

The average price of a new production home sold this quarter was $255,500 with an average size of 2,300 square feet. The average price was $196,400 with an average size of 2,200 square feet for the same quarter last year.

"The existing inventory of unsold lots is near a record low," said Kalfayan. "The report indicates that if the current quarterly sales rates continue, the existing inventory of unsold lots in the Fresno/Clovis area would be completely sold out in nine months."

Also significant is the annual sales increase of 14 percent over the prior 12-month period in the number of new home sales in the Fresno/Clovis area.

The data from the Fresno/Clovis Quarterly Housing Report indicates that 645 units were sold in the second quarter of 2003 with 54% sold in Clovis and the remaining 46% sold in Fresno. "With new developments in the north and south areas of Clovis, Clovis has outpaced Fresno in quarterly new home sales since the first quarter of 2002," said Kalfayan.

John Mahoney, director of the Institute, indicated that The Quarterly Housing Report 2003 is the latest in a series of targeted research projects produced by the Real Estate and Land Use Institute. The Institute also compiles market data on multi-family rental housing in its Fresno/Clovis Annual Housing Report released at the beginning of each year.

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