A little window on the Sac metro housing market

About a year ago, my husband and I found ourselves in Lincoln (Northeast suburb/exurb of Sacramento) with a little time to spare. We wandered into one of the new home communities in Rocklin, one of those sprawling multi-builder, multi-village developments.

Although tract-home living doesn't appeal to us, one floorplan in particular did. Indeed, all four models available in that community had appealing features, though most were simply enormous. What possible justification could we have for a 5,000 square foot home than the overtly selfish, planet-hating "we want it"?

Well, the floorplan we liked was sufficiently appealing that we revisited the development this past weekend (mostly out of curiousity). We picked up a flyer announcing their new low prices, and our desired floorplan was listed at $667k, down from $771k. I seem to recall that prices started in the $800s in that development when we first toured. Today, I checked their website, and that same home has been repriced at $515k.

Even if I am mistaken, and their peak price was in the 700s, that would represent a price drop of 35%. Worse, the earliest residents have been living with construction hassles and an open-gate policy on their gated community (allowing potential buyers in to see the models) for two years. Worse yet, the Mello Roos are supposed to drop in half when the larger community is fully built-out, but current market circumstances suggest that the final build-out will only happen in the next housing boom. Early buyers pay double the Mello Roo payment they expected; while they watch neighboring homes sell for 1/3rd less than their own purchase price. Under Prop 13, property taxes are capped based on a home's purchase price - original buyers may see their taxes adjust down in the short-term, but, long-term, new buyers will save $3,000 a year over early buyers in property taxes alone.

Mama mia.