During the heady days of the housing market boom, no region of the Bay Area gained more -- in homes and people -- than East Contra Costa County, with builders and buyers flocking to swaths of land considered cheap by Bay Area standards.

But when the collapse came, no region was hit harder, with foreclosures and vacancies engulfing cities and drying up demand for new construction.

Brentwood, which for several years ranked among the fastest-growing cities by population in the state, handed out almost 1,400 new home permits in 2003. Five years later, with the housing collapse fueling the greatest economic meltdown since the Great Depression, that number dwindled to 36.

Now, with the housing market on the mend and the recession in the rearview mirror, there are growing signs that East Contra Costa's still-plentiful land is again luring homebuilders. But no one is expecting them to start partying like it's 2003 -- at least not anytime soon.

"The market could not have been any more different in 2003," said Paul Eldredge, Brentwood's city manager. "The developers could not build homes fast enough to keep up with demand, and obviously that didn't work out very well for lots of folks in the housing bubble. ... I would be surprised if we ever saw market conditions like that again. (Today's) lending requirements are totally different. (Before) you just needed an ID and a heartbeat."


Advertisement

The fallout from the bursting of the housing bubble reached far into East Contra Costa. New subdivisions went dormant overnight, leaving some homeowners on a residential island surrounded by acres of vacant tracts. Foreclosures and the resulting flurry of abandoned homes led to widespread squatting and blight.

Housing is sprouting again in Brentwood, Calif.,  as work takes place on this two-story home on Tuesday, Oct. 29, 2013. Many homes are being built near the
Housing is sprouting again in Brentwood, Calif., as work takes place on this two-story home on Tuesday, Oct. 29, 2013. Many homes are being built near the intersection of Lone Tree Way and O'Hara Avenue. Building permits being pulled by developers have increased over the past three years, while city administrators say interest from homebuilders is on the rise. (Susan Tripp Pollard/Bay Area News Group) ( SUSAN TRIPP POLLARD )

Antioch's property value plunge -- from a median home value of $540,000 in December 2005 to $171,000 in May 2009 -- helped push the region's largest city to the cusp of bankruptcy. Meanwhile, Oakley, Contra Costa's newest city, saw its grand plans to grow a population base that would draw big-name retailers, and sorely needed tax revenues, grind to a halt.

Optimism, however guarded, has returned to the region's new home market. Building permits pulled by developers have increased over the past three years, and city administrators say interest from homebuilders is on the rise.

Brentwood, considered by many the most attractive city in which to build in the region, handed out 356 permits to builders through the first 10 months of the year. In Oakley, where spurring home construction is a key city priority, the total was 163.

"We really are seeing things pick up and talking to builders on almost a daily basis," Oakley City Manager Bryan Montgomery said. "That wasn't happening during those tough years."

East Contra Costa provides space for builders, unlike other parts of the Bay Area that have been built out when it comes to single-family homes, said Chris Thornberg, a principal with Beacon Economics.

"Forget Marin, forget San Mateo (County), forget San Francisco. They're done," he said.

However, any expectation of a full-scale return to the boom years has subsided in recent months, as home prices that skyrocketed over the past year tapered off.

The most recent report from the East Contra Costa Real Estate Group, which is chartered to study area trends, attributes the dip to rising interest rates pricing potential buyers out of the market.

A similar decline in property sales happened in 2006 before the bubble burst, but the circumstances are different now.

At that time, homebuilders were overwhelmed with inventory that they could not sell, said group member John Case of Intero Real Estate Services. Builders are busy but largely delaying construction until they have a sales contract, the report says.

While prices are going to all-time highs in areas such as the 680 corridor, Tri-Valley and San Francisco, that is not the case in East Contra Costa. Case says homes that sold at their peak in Brentwood for more than $1 million are under $700,000 today.

Housing is sprouting again in Brentwood, Calif.,  as construction work takes place on a two-story home on Tuesday, Oct. 29, 2013. Many homes are being
Housing is sprouting again in Brentwood, Calif., as construction work takes place on a two-story home on Tuesday, Oct. 29, 2013. Many homes are being built near the intersection of Lone Tree Way and O'Hara Avenue. Building permits being pulled by developers have increased over the past three years, while city administrators say interest from homebuilders is on the rise. (Susan Tripp Pollard/Bay Area News Group) ( SUSAN TRIPP POLLARD )

Bob Glover, executive director of the Building Industry Association of the Bay Area, says homebuilders are looking to build where it makes the most economic sense. In East Contra Costa, that hasn't happened for the most part.

"Projects are getting close, but we're nowhere near out of the woods," Glover said.

Builders are paying 2013 prices for materials but seeing homes sell for 2001 prices, he said.

Thornberg says the tough credit market that resulted from the collapse of the housing market will temper new home growth in the area.

Still, he believes developers will continue to build new homes in East Contra Costa, albeit at a slower pace from a decade ago.

"It's cheap and easy to build (there)," Thornberg said.

With growth returning, the question facing each community is how to move forward. While the youngest city is most eager to see new housing, the more established ones are taking a slower approach.

When home building went dormant in Oakley, city staff worked to streamline building codes and processes.

"We were gearing up to be ready for when things turned around," Montgomery said. "We want to try and kick-start growth."

Oakley cut developer fees to try to stimulate building. All told, the combined discount, which the city has extended to June 30, 2015, amounts to about $14,400 per house.

Still, homebuilders remain cautious, and with prices bouncing back more slowly in East County than the rest of the Bay Area, construction is lagging. "Core areas come back first -- San Jose, Silicon Valley, the Dublin corridor, places like that," said Dean Wherli, vice president at Irvine-based John Burns Real Estate Consulting.

Van Daele Homes, a Southern California-based builder, plans to build 150 single-family homes in Brentwood in two subdivisions at the intersection of Lone Tree Way and O'Hara Avenue. Construction started a few months ago on the first set of homes.

The good schools, new stores in the Streets of Brentwood and plans for an eBART station drove the decision to build in the city, said Bill Pisetsky, Van Daele's vice president of sales and marketing.

"So with the combination of those three, you are building in a very viable area," he said.

Antioch City Manager Jim Jakel thinks some developers are "holding back" in East County until the Highway 4 widening and BART extension are completed by 2015 and 2017, respectively.

"The improved transportation will make living here more attractive to commuters," he said.

Antioch's anticipated growth changed recently when 656 acres in the hills on the city's southeast border known as Roddy Ranch was purchased by the East Bay Regional Park District. Previously, plans called for that land to be developed into 574 estate homes akin to those found in Blackhawk.

Pittsburg and Antioch have similar growth plans -- both anticipate a fairly steady number of homes being built over time, along with the construction of higher-density housing around planned eBART stations. At the same time, the cities are focused on creating a healthy balance between jobs and housing.

"We're trying to work with developers to ensure the growth rate is manageable, and at the same time we're working with industry and having industry trying to develop in Pittsburg ... It's a balancing act," Pittsburg City Manager Joe Sbranti said.

Contact Paul Burgarino at 925-779-7164 and Eve Mitchell at 925-779-7189. Follow them at Twitter.com/paulburgarino and Twitter.com/EastCounty_Girl.

Permits by YEAR

Oakley Antioch Brentwood Pittsburg
1999 -- 686 1144 303
2000 -- 1157 954 261
2001 190 1005 1254 415
2002 223 663 1682 294
2003 265 233 1361 389
2004 209 124 1296 214
2005 524 350 1403 286
2006 608 172 474 135
2007 277 154 355 559
2008 163 116 36 45
2009 210 119 87 232
2010 167 93 145 132
2011 77 131 104 230
2012 150 263 245 214
2013 163 176 356 205
* Through October

PERMITS PER MONTH IN 2013

Oakley Antioch Brentwood Pittsburg
January 10 7 42 8
February 12 20 18 32
March 27 36 23 11
April 26 0 36 28
May 16 12 33 19
June 8 18 66 35
July 21 27 25 32
August 24 38 45 8
Sept. 13 20 32 1
Oct. 6 10 15 33