Sacramento building officials say they are seeing signs that the city’s housing development industry is finally turning around.
Developers are on pace to construct three times as many new homes during the current fiscal year as were built in Sacramento just two years ago, when the new home market bottomed out, city figures show. Since July, 187 homes have been built, with several more soon to be constructed at infill projects around the city.
The numbers are still well below the city’s peak from 2003 – when an average of 10 new homes were built every day – but are an indication that activity is picking up, officials said.
The news is not as positive for commercial building.
This fiscal year, the city’s development department has reported 26 new commercial projects. If that pace holds steady through the next three months, the city will see its lowest number of new commercial developments in a fiscal year since at least 1999.
Ryan DeVore, the city’s chief building official, said the trend in commercial building could change quickly. Six projects valued at more than $1 million were approved during the last three months of 2013 alone.
For now, recent activity in the home building industry has given city officials optimism.
Earlier this month, a home builder announced it would begin construction next month on 86 new homes in the Curtis Park Village project on the site of a former railyard near Sacramento City College – only 93 homes were built citywide during the entire 2011-12 fiscal year. The $22 million project is part of a larger development that eventually will include nearly 300 single family homes, apartments and retail space on the 72-acre site.
“It’s those kinds of things that weren’t happening the last few years that are happening now,” DeVore said. “There weren’t any Curtis Park Villages or McKinley Villages. People weren’t willing to take those risks.”
The new home construction will have an impact on the city’s budget, DeVore said. Property and sales taxes paid by the new homeowners will support core city services such as police and fire protection, and fees paid by developers will go into a fund to pay for new parks.
The total value of new homes being built is also on the rise. DeVore said $28 million worth of new housing was constructed during the last six months of 2013. During the entire 2011-12 fiscal year, the total value was $16.9 million.
Call The Bee’s Ryan Lillis, (916) 321-1085. Read his City Beat blog at www.sacbee.com/citybeat.