the visible hand

it is the theory which decides what can be observed – einstein

Local experts debate the state of Humboldt’s housing market

Posted by ecoshift on December 9, 2007

Kudos to Eric Eschker for putting out the data that allows us to see the similarities between Humboldt’s real estate trends and the national housing market bubble/crash making recent headline news.

The Humboldt Economic Index provides much needed data and analysis that can help raise the level of debate on Humboldt County land-use and housing issues. Too much of what we read and hear is agenda driven hyperbole.

I don’t know who’s funding Eric, but his budget should be increased to allow for a more thorough analysis and the presentation of the underlying data. Median sales prices, as pointed out in the article below, are difficult to interpret without a better understanding of where sales came from across market price segments. If sales volumes for homes under 250k fall by 50% and sales volumes for homes over a 1,000k fall by 10% the median price could rise even if both high and low end prices have fallen by 10 to 15%. Breaking sales figures into quintiles would help us all to understand what is actually happening. It would also be helpful to have better information on sales of larger rural parcels, both developed and undeveloped.

The debate encouraged by Eric’s data and analysis provides an important first step to moving beyond sectoral and individual agendas and towards our ability to think strategically about shared goals for the future of Humboldt County. If changes in TPZ residential use do impact parcel values it will be critical to effective County planning that we distinguish clearly between the impacts of local zoning regulations and the impacts of national housing and economic trends on local real estate values.

Both sides of the argument below have some basis in fact. Humboldt is special beyond doubt. And, the gentrification and development moving up the coastal counties from Marin, to Sonoma to Mendocino decade by decade constitute a long term trend that increases the value of residential properties in Humboldt County. But, the recent double digit increases in home values on the north coast represent more than this long-term trend. It is likely a mistake to bet heavily on Humboldt real estate being immune to national housing market trends.

Thank you Eric for helping to move the conversation beyond emotion, self-interest and ad hominem comments.

Times-Standard Online – Local experts debate the state of Humboldt’s housing market
Ryan Burns/The Times-Standard
Article Launched: 12/09/2007 01:42:25 AM PST

Home sales in California are down — way down. The number of homes sold in October decreased 40.2 percent, and the median price of existing homes fell 9.9 percent, compared to the same period a year ago, according to a recent California Association of Realtors report. But local experts disagree on how these numbers relate to Humboldt County’s housing market.

In October, HSU Economics Chairman Erick Eschker predicted that home values in the county could fall by as much as 40 percent, an assertion that was widely and vehemently challenged by local developers and real estate brokers.

Larry Doss, president of the Humboldt Association of Realtors, took out a full-page ad in this newspaper disputing Eschker’s claims. Included in the ad was a grid showing the average price of homes sold in the county from January 2000 through September of this year. Sure enough, according to these numbers, the average price has not dropped drastically since it peaked at $377,159 in March 2006. But it is declining.

The September figure was $358,354. October was down to roughly $347,000, said Doss last week. November’s numbers were still coming in, but “they’re low,” he said. “They’ll probably be in the $335,000 to $340,000 range.”


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