New construction down in SLO County

September 3, 2016

Home construction

By Sierra 2 the Sea publisher John Lindt

New home construction and commercial building activity in San Luis Obispo County has slowed dramatically during the first eight month of 2016, according to Construction Monitor.

This year, builders received 295 permits for single family homes. A number that is less than half of the 695 new homes permits issued in the first eight months of 2015.

In 2015, Shea Homes, who build in the Nipomo area, and Coastal Community Builders were the leading home builders in 2015. Shea Homes received 75 new home permits and Coastal Community Builders received 73.

So far in 2016, Shea Homes has received permits for only 19 homes and Coastal Community Builders has received 27 permits.

Of the 295 new home permits issued in 2016, only 16 are in the City of San Luis Obispo. Builders are constructing most new residences in Templeton, Nipomo and Paso Robles.

On the commercial front, there is clear slowdown to date with construction valuations at only $103 million so far this year versus $301 million during the same period in 2015.

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Managing decline is the name of the game out here. In the rich cities of the world, people have said today’s economy makes it such that if you can’t grow then you decline.

CA is not the worst state to do business, NY is. But once the immigration faucet gets turned off and companies have to pay American workers again, many CA companies will be hurt because they rely on poor third world types who don’t know any better than to live cramped cities.

CA thinks it’s so smart and yet it’s went one party rule, like in Latin America. Other states are ahead of it living standards and influence and virtually no one wants to copy the single party rule.

There shouldn’t be any we don’t have water!

The housing market is cooling off. Much of the recession-caused pent up demand is spent. Prices are in bubbleland. Places are taking longer to sell than last year. One would guess the slowdown in building is just part of the usual up and down cycle.

It’s not just the local government fees. Governor Brown has an unsigned bill that would double developer school fees from $7.00 a square foot to $14. just a week and a half ago. Normally California pays half of new school construction but in an impacted (immigration) “hardship” town the State pays 80-90%. This week a Tulare County “hardship” school district which only has to pay 20-10% might lose $250k because a developer won’t pay the new $500k school fee to build some low cost homes. If you think illegal immigration isn’t costing California tax payers, you better think again.

Pretty easy to figure out. Most of the builders acquired their land thru foreclosures or bankruptcy sales at a much lower cost than the current value of properties. Because of the lower prices paid they were able to absorb the obnoxious fees that are charged for building permits and produce a profitable product.

The government thinks that they had found the Golden Goose with the amount of building that had gone on in the past and saw what they thought an opportunity to just keep raising fees and other costs for permits. Well now it has caught up to them and their income from fees will decrease significantly.

So, only as government can do, instead of laying employees off since there is a decrease in their workload they will increase fees to cover their loss.

Could this be a supporting move to confirm that California is the worst state to do business in. SLO County is on board to help the situation.