Homes for sale are down in Bakersfield, home building goes up

Homes for sale are down in Bakersfield, home building goes up »Play Video
BAKERSFIELD, Calif. (KBAK/KBFX) — With so few houses for sale in Bakersfield right now, home-builders are finally seeing their business going up. Local real estate appraiser Gary Crabtree says the current supply of existing homes is at an historic low, and he sees both local and national construction companies gearing up to build houses.

"Everybody's busy," Towery Homes owner Matt Towery told Eyewitness News Friday. "Due to the lack of inventory of existing homes, there is now a need to build homes again." He's got a batch of homes going up in northwest Bakersfield near Olive Drive and Calloway.

Towery says that was a subdivision that "collapsed" during the real estate bust of 2006-2007. "So we were able to pick up the rest of this subdivision and start building again. A lot of the foreclosed lots, we were able to buy," he explained.

While the foreclosed lots are being snapped up by builders, Crabtree says the existing foreclosed homes are also gone.

"The foreclosure market, for all intents and purposes, is dried up," Crabtree said Friday. It's one of several reasons for the low supply of existing homes. He said interest rates are also low, and investors are now scooping up homes, often cash in hand.

Crabtree says it's added up to the extreme shortage of Bakersfield homes for sale. "We're at 432 active listings on the market today," he said. "That's the lowest we've been in the recorded history." Crabtree's been tracking local real estate since January, 1993.

His latest numbers show of the active listings, only 42 are from foreclosures and 21 are "short sales." He says it all breaks down to about one house per neighborhood that's now on the market.

And, legitimate home-buyers are now looking. They're getting stiff competition from investors who want to buy and rent -- or buy, renovate and re-sell. Crabtree says the non-investors are "quality" home-buyers.

Asked about who's buying his homes, Towery said it's people who've grown up in the area and they're now ready to buy, and there are also people who can get back into home-ownership three years after doing a "short sale." It's adding up to more customers and more workers.

Towery said they've added a lot of jobs, and that has ripple effects. "It's good for the economy at large," he said. "People are buying trucks again, they're buying tools."

And while it's a relief to hear hammers and saws again, things aren't back yet to where they were before. "It's still not quite what a town our size should be," Towery said. "But, we're getting there."

He estimated there were some 2,200 homes a year built in Bakersfield before the housing bubble, and predicts the area will see 1,200 to 1,400 this year.

Crabtree is also looking at before and after the bubble. While the inventory of existing homes is now record low, he says prices are climbing up.

"As a result of the lack of supply, the median price increased another 3 percent last month, to $175,000 or 32 percent higher than the same period last year," he writes in a memo. He adds the last time Bakersfield saw that median price was May 2004, before the last bubble.

And what's next? "Prices are increasing, we're in a full-blown recovery," Crabtree said. "And where we're going from here, no one really knows."