MODESTO -- The Stanislaus County housing market is showing consistent improvement in three key measures of strength, according to the National Association of Home Builders.
The county's increasing home prices, expanding building permits and growing employment earned Stanislaus the designation as one of the nation's "improving" housing markets.
Only 125 of the nation's more than 365 metropolitan statistical areas are on that improving markets list this month.
After more than seven years in a devastatingly bad housing market, that's good news for Stanislaus.
"The recent upturn looks convincing," said Robert Denk, senior economist for the National Association of Home Builders. The Stanislaus housing market "has moved up in a credible, consistent and sustainable way."
Just four other California communities — Sacramento, San Diego, Santa Cruz and Visalia — are on the improving markets list.
To get that designation, Denk said a metropolitan area must show six consecutive months of growth in home prices, building permits and employment. By tracking those three sets of statistics, "we think we're capturing what's going on in the current market."
The improving markets index compares each community against itself, not against other communities. It measures prices, permits and employment from the worst point of the recession — whenever that was for each community — then watches for sustained month-over-month improvement.
According to the index, Stanislaus home prices hit bottom in December, employment was the worst in July 2011 and building permits were lowest in November 2010. All those categories have been consistently rising the past six months.
Alex Zachariou has seen the improvement firsthand as the sales agent for the Liberty new home development in Oakdale.
"During the last 11 days, we've sold four homes," Zachariou said. Builder Raymus Homes began marketing Liberty's 49 houses in the Bridle Ridge community this March, and 14 have sold.
This month's sales surge makes Zachariou optimistic. He said people who have shopped for bargain-priced foreclosed houses know very few of them are on the market.
"There are bidding wars for homes going on ... and they have to compete with all-cash buyers," Zachariou said. But his development has fixed prices, starting at $209,990 for a 1,553-square-foot house, and its new homes have full warranties.
Liberty is one of just a couple of active new home subdivisions in Stanislaus. Raymus Homes purchased those ready-to-build-on lots last year at a bargain price after the previous developer went belly up.
Builders throughout the county were decimated by the housing market crash.
During the 2005 peak of the building boom, 4,525 housing units worth more than $787.3 million were built in Stanislaus.
But last year, only 164 building permits were issued and that housing was worth just $28.3 million, according to U.S. Census Bureau data.
During the first nine months of 2012, Stanislaus has issued 181 building permits. That includes 101 single-family homes and 80 multifamily housing units, with a total value of $26.1 million.
Stanislaus home values also are up, according to the Freddie Mac House Price Index, which uses data from home loans purchased by Freddie Mac and Fannie Mae.
That index shows price fluctuations for a Stanislaus house that theoretically was worth $100,000 in December 2000.
By March 2006, that Stanislaus house had grown in value to $232,060. But its value plummeted to $84,760 by December 2011. As of this September, its value had increased to $93,220.
"We're making progress, but there's still plenty of room to go," Denk said. Nationally, he said home prices started turning around in the past six to nine months.
Bee staff writer J.N. Sbranti can be reached at jnsbranti@modbee.com or (209) 578-2196.
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