Why home-building is stalled in Stockton

This is a re-post of a blog item originally posted June 2.

Holding back home-building? A homicide scene on West Acacia Street in April.

Former Mayor Anthony Silva, prodded by developers, persuaded the Council to reduce Stockton’s building fees. The idea was to spur home-building, which around here is flatter than syrup on a pancake.

It didn’t work.

Surrounding cities, meanwhile, are seeing brisk home-building.


I asked John Beckman, head of the Building Industry association of the Greater Valley. Beckman’s reply:

“Over the last 12 months (as of late May) here are the number of used homes that were sold in each local area along with the average sales price for those homes.  New homes on average command about a 50% premium over the average price of used homes.  The cost of labor, materials and infrastructure in every jurisdiction is about the same.  The three most important variables that developers look at are:  1) What can I sell the end product for, 2) What are the fees, and 3) How much does the land cost.”

City # Sales Avg. Price
Mountain House
























“What you can sell your product for in Stockton is significantly lower than anywhere else.  The fees in Stockton are temporarily reasonable but that will change soon so you can only count on that for another year.  Unless you get the land a lot cheaper than you can buy it anywhere else, Stockton isn’t worth the risk.

“Some say, if you build it, they will come.  It doesn’t work the same way with entitlements.  You can entitle 20,000 units but unless there’s a market for those units they will never be built.  The risk reward factor for Stockton is still very risky compared to the surrounding communities.”

Beckman’s convincing answer raises a follow-up question: Why are home values so low in Stockton?

“What’s depressing home values in Stockton?” Beckman responded.

“1)    Lack of good paying jobs

“2)    Higher crime rate than surrounding area

“3)    Lower education levels than surrounding area.”

So according to Beckman, the torpor of Stockton’s housing sector is not due to regulations or fees. It’s due to depressive effect on home values of the city’s weak economy and social problems. Which, in turn, suggests where policy makers should put there efforts.

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    Michael Fitzgerald

    Mike Fitzgerald is The Record’s award-winning metro columnist. His column runs in the paper three times a week. Born in San Francisco, he was raised in Stockton. His column covers diverse beats including, sometimes, the offbeat. Read Full
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