Home prices jump

July 23, 2003 12:00 am
Dee Dee Kinney, left, shows a Gainard Street home to Necole Allen and Mark Holmes. The two, from Colorado, are interested in buying the home. (Kent Gray/ The Daily Triplicate).
Dee Dee Kinney, left, shows a Gainard Street home to Necole Allen and Mark Holmes. The two, from Colorado, are interested in buying the home. (Kent Gray/ The Daily Triplicate).

By Kent Gray

Triplicate staff writer

A migration from urban areas to small towns, caused by recession and terrorist fears, is causing home prices to skyrocket in many rural areas – including Del Norte County.

Depending on the home, prices have risen in the county between 30 percent to 50 percent in the past two years, according to real estate professionals.

"Except for the time when the prison went in, which wasn't as much, this is probably our first seller's market — the first time ever for this area," said real estate agent Jimmy Csutoras.

Yesterday, less than five minutes separated two potential buyers as they toured a home on Gainard Street. The four-bedroom home, being offered at $115,000, has only been on the market since Sunday. Agent Dee Dee Kinney predicted the home will be sold for more than the asking price.

Speculation among professionals is the buyers' glut is fallout from a weakened stock market and the terrorist attacks of Sept. 11, 2001.

Agents said most buyers are coming to Del Norte from the Los Angeles and San Francisco areas. One thing they are seeking is a good investment in a sluggish economy.

"When the stock market problems started a couple years ago, we saw it starting to pick up," said broker Mimi Stephens. "Real estate is the one investment that always seems secure."

Agent Sonny Syrstad said he has no shortage of buyers who are interested in investing.

"I had one buyer who bought a property, closed escrow, and never set foot on the property. That was interesting," Syrstad said. Several buyers from the San Diego area, looking specifically for rental properties, recently contacted Syrstad.

"I had a duplex fall out of escrow recently, but I had two backups who were offering full price for it ... everything's selling," Syrstad said. "Times are good — the best I've seen it since I've been here, over the past 15 years."

Another buyer profile is people seeking refuge from the insecurities of the big city. Stephens and Csutoras agreed that it was after the 9/11 terrorist attacks that the market really began to sail.

"Some are coming here to get out of the urban areas — looking for a safer place to raise their families," said Stephens.

"I'd say it was the fear factor after 9/11 that started the phones ringing off the hook," Csutoras said.

Robert Gambee, author of the 1999 book "Wall Street: Financial Capital," predicted shortly after 9/11 that there would be no major exodus from New York City or other large cities.

Two years later, that's not what buyers have been telling Stephens.

"With the way computers are today, it has changed the way we work. People are able to conduct their jobs from a distance through that," Stephens said.

In a report commissioned by the San Francisco Board of Supervisors, Michael Reich, professor of economics, and Amy Laitinen, master's candidate in public policy — both of University of California Berkeley — said both economics and terrorist fears are affecting Bay-Area businesses.

"Moreover, in 2000, the boom peaked and the ongoing current national recession began, putting many San Franciscans out of work," the report said. "The subsequent bursting of the technology bubble and the post 9/11 declines in tourism affected San Francisco more than most other cities. After three years of recession, the business cost structures in the city, especially the elements involving commercial rents and transportation, have adjusted downwards from their peaks."

Shlomo Breznitz, a psychologist at the University of Haifa in Israel and an authority on living amid violent conflict, told the Los Angeles Times last year that most people will readily relocate to avoid danger. But, with 9/11, the verdict isn't in yet.

"Trauma, whatever its intensity, has a major impact on one's life only if there are reminders of it. And for this, it's too soon to tell," Breznitz said.

Csutoras said he might be happier if the buying binge in Del Norte County leveled out.

"It certainly keeps you busy, with everything across the board selling," he said. "I'm not sure if I'm lucky. I think I'd like to see it slower."