On March 17, 2017 our RE-41 classroom had the privilege to hear Mr. Don Scordino from Realty Concepts give a short lecture regarding his personal ideas on the current real estate market and its future possibilities. According to Mr. Scordino, the central valley, which includes the city of Fresno, is running out of space for future housing development due to the speedy uprising of our local population and the increase popularity of our lower housing cost compared to the inflatable prices of the bigger cities like Los Angeles, San Francisco, and San Diego, but we are now running out of space, which is added by the quality of our fine country living and aggressive growth of the vast luxurious acre-spaced ranches, where two story housing are being forced to take over single story residences to save time, space and money (especially in plumbing costs) because the generated expenses to build a regular home averages between $60,000-$70,000, and for the home builder to make a comfortable profit, they would have to charge the regular consumer at least over $200,000 to buy a suitable home. This is truly troublesome for the young first time home buyer, who is just starting off in their job where the normal yearly wage are roughly between $30,000-$40,000 a year, and let’s not forget the rising interest rates on home loans, which are speculated to be as high as 5% by the end of this year, plus, there is no certainty on the type of restrictions that the federal government will imposed on the general public, in regards to bank loans whenever they feel the need to tighten up their belt, which concludes the constant rising score of the consumer’s credit rating that makes them eligible or qualified for a business investment or personal home loan.
Now with the proposed extension of the California speed rail coming through the Fresno area, there is a good chance that many big city residents will move into the central valley especially since they have the option to sell their highly expensive cradle back home and purchased a few valley residences with cold hard cash,(which will also relieve them of that persistent monthly mortgage), thus, sharing the enjoyment of our fresh country air unlike the polluted smog smell endured in the larger cities, and why not since they can still continue to get to work on time in the big city due to the quickness of the high mighty speed rail, unfortunately, this sudden surge of big city migration will not only enhance the central valley’s population, but it could also mean more housing projects, which will eventually lessened our valley’s space. Now don’t get me wrong this is indeed fantastic news to every agent in the real estate market, but what happens when we run out of room? Do we start to suffer the same consequences that lie behind a bigger city like L.A or San Francisco, for instance, with its attached big city problems, like a higher crime rate, increased rent or more pollution? Will the hourly pay rate in our Fresno job match the city government’s demand for higher taxation on limited goods and fuel that is inherited along with the supposably better benefits of becoming a larger city? What about the increased job demand? Will there be enough work for everyone after everything is said and done! Are we doing such a good job with this exact problem now? Some people living in the valley really don’t think so...I guess only time will tell.
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