Sid Dunmore, of Dunmore Homes, a family run business with head quarters in Granite Bay who has built homes in the Sacramento area since 1954 is now the first casualty of this Real Estate market.
Although the market in Sacramento is worse than in Phoenix, it seems likely homebuilders will go out of business here too.
It’s a bad deal for the homebuilder and his employees, for sure.
They’re not the only ones hurt. It’s also a real tough deal for the homebuilder’s former clients.
Now, in the meantime there are new homeowners at the Monterey Village in Elk Grove who have liens slapped on their new home from contractors that were owed money by Dunmore Homes. The subdivision is not finished but has homes that are in the process of being built and others that simply have pads, gates that haven’t been installed and streets not yet paved in some areas.
That is indeed a tough deal for the homeowners.
Forewarned is forearmed.
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Tom Puma 09.29.07 at 8:52 am
I think the builders have over run the valley by storm. And that the cities are giving out permits like they are going out of style. This is why the resale market is so bad. And why so many people are losing their homes. Once the builders fall by the wayside, it will give the resale market a chnce to get back up on their feet again. If all these so called people are visting the valley and moving here from other states, then where are they buying?
But thats just My! opinion.
John L. Wake - Realtor 09.29.07 at 9:07 am
I don’t blame the cities for granting the building permits. Their goal isn’t to control supply, just to make sure the homes meet other city criteria.
The builders have been horrible about controlling their own supply.
KG 09.29.07 at 9:51 am
John–How much do cities charge a builder per home? Isn’t this called an impact fee? If the cities control the supply, they loose money! No money for parks, libraries and fire stations.
So of course the cities are to blame. It’s all about $$.
KG 09.29.07 at 9:52 am
As far as homebuilders go…I wouldn’t buy stock in Standard Pacific or Khovonian
Cbass 09.29.07 at 12:40 pm
When ever the media reports on the “Housing Bubble” Vegas Nevada, Miami Florida, and ours truly Phoenix Arizona are always mentioned. When did Sacremento boot us from the top three?
John L. Wake - Realtor 09.29.07 at 1:37 pm
I don’t have a reference but I’ve read that Sacramento is doing terrible, perhaps the worst market in California which is saying something.
The point is, however, that homebuilders are starting to go out of business, not ranking the the U.S. real estate markets.
Ken44 09.29.07 at 5:14 pm
The market psychology to buy is completely dead. At this point it doesn`t matter what the builders do. Nobody is buying.
However, help appears on the way thanks to the US government. My guess is the Feds will continue to lower rates and the proposed housing bailout will keep a lot of people in their homes that otherwise would have been tossed out.
Ps. You`re right about the Sacramento market being the worst in California. It makes the Phx metro seem almost healthy by comparison.
KG 09.29.07 at 8:32 pm
The central valley of California was one of the hottest housing markets. Last I read it counted for every 1 in 25 new homes being built nationwide.
Now it has slowed down and my guess is it probably has the highest number of spec homes nationwide.
Ask a homebuilder why they keep building and if they will talk, they will tell you it is just about the only way to liquidate land these days. Just another reason why cities need to control permits.
It may be good for some of these builders to go under. The strongest survive and there may be too many home builders out there right now.
KG 10.04.07 at 7:18 pm
A few weeks ago I mentioned to stay away from Standard Pacific stocks. Here is another reason to run far far away.
http://biz.yahoo.com/bizj/071004/1531266.html?.v=2
Minimum Wage 01.19.08 at 10:02 pm
There’s something I’d like to ask a homebuilder:
The homeownership rate of employees where I work is zero. I see a huge untapped market of people who would love to buy a tiny home, a cottage, anything. (How about SRO condos?) Why isn’t anyone building homes for people like us?