Merced County home sales prices dipped in January, as they did throughout California, but Merced homes still sold for 9 percent more last month than they did a year earlier.
Merced’s median-priced homes sold for $149,330 in January, which was about $11,000 less than during December but about $12,000 more than January 2013, according to numbers from the California Association of Realtors.
The number of homes on the market remains low in Merced but real estate professionals are predicting that building will pick up in spring and summer.
“We’re seeing more interest in the real estate market in general,” said Terry Ruscoe, owner of Merced Yosemite Realty in Merced. “Things are picking up, albeit slowly.”
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The cost per square foot to build a home has not reached the point to spur much development, Ruscoe said. Developers are likely gun-shy after the housing market crash. “Not only did they get bit hard, they stayed bit longer,” he said.
Many are predicting a slow, steady improvement in housing prices, which mirrors what analysts say about expected improvements in the region’s economy and unemployment rate.
“I do see a definite increase for a nice, steady recovery,” said David Gonzalves, director of development services for the city of Merced.
Gonzalves said he’s been meeting with developers and he expects 2014 to produce 35 new homes in Merced. Those will be built on existing lots.
Gonzalves said he does not expect to see the “overwhelming” numbers that the city saw before the Great Recession took hold in 2007. A “typical growth” year for Merced would produce between 200 and 300 new houses, he said.
Across the state, home prices dipped an average $28,000 last month. The state’s median sales price was $410,990 in January, 22 percent more than a year ago.
Merced’s trends of high demand and low inventory are similar to statewide trends, according to Kevin Brown, president of the California Association of Realtors.
Others are optimistic about the potential for growth in Merced.
Realtor Andy Krotik of Coldwell Banker Gonella Realty in Atwater said with houses selling faster and worth more than they were last year and 2012 , development in the area could triple.
Houses in Merced County stay on the market an average of 20 days less than at this time last year, and nearly 30 days less than 2012, according to numbers from Krotik.
That means the demand in Merced for new homes is high. “I think you’re going to see a robust summer of building,” he said.