From Engineering on January 12, 2009 in General
Modesto, California, is ground zero in the real estate slump. Of the total homes for sale, almost all of them are short sales or foreclosures. However, theres a great demand for these bargain homes and currently there are more buyers than inventory. The market down-turn affected everyone, whether positively or negatively. Heres how my town is bouncing back and adapting:
The lucky ones who bought before the balloon burst
People who bought five or six years ago and secured an A paper loan are ahead of the game. Many of these homeowners are staying put and planning remodeling projects. Every day I drive around town and see second story additions being built or rooms being enlarged. Rather than buying bigger, theyre building out.
Investor groups buying future rentals
Another large area of remodeling activity is coming from investors or investor groups. Theyre buying real estate by the pound as future rentals. Many of these homes are in shabby condition. Once the homes are remodeled, theyre rented out at top dollar. Remodeling work on these projects include the updating of failing structures and reviving, or restructuring, small spaces into usable space.
I also see a trend with homeowners whove owned their homes for 10 or 20 years who have considered relocating or downsizing but have decided to ride out the storm rather than sell during a turbulent market. Theyre taking advantage of the situation by updating the façade of their homes, changing or enhancing their rooflines, updating their kitchens, or remodeling their bathrooms. Not only do they benefit from improved living conditions and overall aesthetics of their environment, their investment will pay off when they decide to sell because their house will be more desirable.
First-time home buyers
Theres a huge influx of 2 bedroom, 1 bath homes for sale. Many of these homes were built in the 1930s and 40s and are sitting on huge lots. Most of them are fixer-uppers and previous rentals; yet theyre a true opportunity for first-time home buyers. This group of homeowners might not have the funds to start remodeling this year but, rest assured, the reason they bought that little house on the huge lot is because they saw the potential to expand. Most likely theyll add a 2nd bathroom within the year of purchase.
Certified Remodeling Contractors in Modesto, CA: