El Dorado County Market
Posted by John Lockwood on November 28th, 2006
Based on Dataquick data, The Mountain Democrat recently reported a 2.7% rise in median prices for El Dorado County in October compared to a year ago. Painting a somewhat rosey picture, the article begins:
El Dorado County continues to defy the regional trend of declining home prices. In their October report, DataQuick Information Systems found year-over-year median price declines in existing single-family homes for Nevada, Placer, Sacramento, Sutter, Yolo and Yuba Counties. The drop in home values ranged from five percent in Sacramento to 11 percent in Placer County. El Dorado County, however, posted a slight 2.7 percent increase, finishing the month with a $445,000 median price, the second highest in the eight county region.
I myself have noted the same thing about El Dorado County in my own work. Seemingly defying gravity, El Dorado County’s prices continue to post modest gains even as every other county in the area shows a loss. I’ve been at something of a loss to explain this, especially in light of the huge losses in Placer County, a market that one might expect to perform somewhat similarly to El Dorado County.
As I read further in the article, one possible explanation came to mind, the dampening effect on the supply side that’s been created by El Dorado County’s traffic mitigation fees. I have to wonder to what extent calling this slowdown in land sales “the desired effect” is meant to be tongue in cheek or how much it’s meant to be provocative:
The new Traffic Impact Mitigation Fees are having their desired effect. Vacant land sales have nearly stopped. With over 700 vacant land parcels listed for sale in the county, only 13 monthly sales were reported. It was the slowest month for land sales in recent history. Building and impact fees now easily total $80,000 for an average size house in some parts of the county, forcing many to look for lots and acreage elsewhere.
Well, I’m sure some of us already here who are thinking along solid Republican principles of “I got mine” may have desired that effect, but builders don’t, buyers don’t — certainly no one with land to sell thinks it’s a very good idea. Thirteen monthly sales and 700 units in inventory works out to be some four and a half years of land inventory. Ouch.