Investors purchase undervalued abandoned housing subdivisions
March 22, 2012 9:09 AM
Tomoya Shimura, Staff Writer
A private investor who recently bought 233 abandoned housing lots in four Victor Valley subdivisions plans to sit on them until the housing market picks up, according to a broker involved in the deal.
The unfinished housing lots purchased by the Southern California investor were owned and developed by Hesperia’s Frontier Homes, said Randy Coe, senior marketing consultant of the Land Advisors Organization brokerage firm. Construction halted after the housing market collapsed and a bank foreclosed on the properties.
The bank sold parts of the following subdivisions in February’s multimillion-dollar transaction (Coe declined to disclose investor names, banks and exact dollar amounts):
• Barcelona Heights II near Maple and Topaz avenues in Hesperia;
• Copper Crest near Escondido Avenue and Sultana Street in Hesperia;
• Autumn Glen IV and V near Nisqualli Road and Third Avenue in Victorville;
• Adelanto-5 in Adelanto; and
• Falcon Point II (131 lots) in Lancaster.
In a separate recent transaction brokered by Coe, another Southern California private investor bought 142 lots at the Tuscany III subdivision near Mojave Drive and Onyx Road.
During the past four years, investors have come into the High Desert, slowly buying up housing subdivisions as prices plummeted. A Newport Beach investor, for example, has purchased nearly 1,000 lots in Hesperia, according to Russ Blewett, Hesperia mayor and a former housing developer.
In February 2006, an average home in the desert sold for $327,561, according to data compiled by Larry Trombley of Century 21 Rose Realty. This year during the same month, a home averaged $116,812.
Blewett said it’s good news that speculators are purchasing cheap housing lots from banks. The investors will maintain the lots and sell them to homebuilders for profit when the market starts recovering, he said.
“I wouldn’t let banks own anything,” Blewett said. “Frankly, they don’t know what to do with it.”
There are few opportunities left in the High Desert for investors to purchase undervalued vacant subdivisions, Coe said
Tomoya Shimura may be reached at (760) 955-5368 or TShimura@VVDailyPress.com. Follow Tomoya on Facebook at facebook.com/ShimuraTomoya.
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