REAL ESTATE: 103-home Menifee project sells out in 9 months

June 25, 2011, 9:21 pm

The New House by RSI, a new Southern California homebuilder with corporate headquarters in Newport Beach, reports triumphantly that its inaugural 103-home project in Menifee sold out in nine months and it is launching another in Beaumont.

According to a news release, the Menifee project was the fastest selling in the Inland Empire, based on 78 closings in March, which gave it an average of 13 sales a month going back to October when it opened.

Steve Johnson, Riverside director of MetroStudy, a national consultant, said all those sales probably occurred at once because of the unique way that New House builds homes.

The company assembles important structural components in a manufacturing plant and then ships them to the site where it puts the homes together with specially trained construction teams.

This kind of construction with pre-manufactured parts produces good quality houses with straighter walls and truer dimensions than houses built completely outdoors where exposure to weather can warp the lumber, Johnson said.

Also he said the efficiencies gained with offsite manufacturing assistance probably had a lot to do with the affordability of the homes, which sold for between $143,500 and $210,500.

What made The New House project in Menifee sell so well in this dismal market? Without a second of hesitation Johnson answered, “It is price.”

The American Institute of Architects reports a steep drop in demand for design services in April and May, as measured in the amount of billings received. The index that the association uses to measure inquiries about new projects in May slid to its lowest level in nearly a year and a half.

The association’s chief economist, Kermit Baker, blames in large part an ongoing credit freeze from lending institutions for building and construction projects and noted the reversal of a positive trend seen in the first quarter of the year.

A “shadow inventory” of homes that are seriously delinquent or already in some stage of foreclosure or bank-owned — but that do not appear in multiple listings as available for sale — shrank by 200,000 from April 2010 to April 2011, according to a report released today.

The total number of homes in this rather invisible category has declined to 1.7 million units from 1.9 million units nationwide, said the report from CoreLogic, a Santa Ana-based provider of information, analytics and business services.

“The decline was due to fewer new delinquencies and the high level of distressed sales, which helped reduce the number of outstanding distressed loans,” CoreLogic said in a statement.

Still, because home sales have slowed, the company estimates it will take five months to sell off the current shadow inventory of distressed homes — the same time it took to clear away the larger shadow inventory of a year ago.

CoreLogic said it does not track the shadow inventory in specific parts of the United States like Riverside and San Bernardino counties.

Property Management