Housing Watch: Merced home prices hit all-time high

MERCED, Calif. (KFSN) -- Just 92 homes were available to buyers in Merced. Normally, you would see 350-400 houses for sale, according to realtors.

Growing demand has helped push the average price of a home in Merced to an all-time high.

It has become a familiar story around the Valley -- extremely high interest in new and existing homes but low inventory.

Berkshire-Hathaway Drysdale Properties Sales Manager Scott Oliver believed people may be surprised to hear the median price of homes now up for sale in Merced.

Oliver said, "We're sitting at about $409,000."

That could make the home search difficult for many families.

Oliver explained, "To get a 1,800 square foot home here, you're probably looking at north Merced. You're looking at probably over 400, 425, somewhere in that range unless it's in a preferred neighborhood."

Oliver said the continued growth of UC Merced and the expansion of Dignity Health has helped make the city a more desirable place to live.

Merced, though, used to provide a much cheaper Valley housing option.

Oliver said, "There was a 25% gap in the bigger towns like Visalia, Fresno, even Modesto and Turlock as opposed to Merced. Well, Merced has now closed that gap."

Terry Ruscoe of Merced-Yosemite Realty noted investors from outside of the Valley were helping to drive up home prices.

Ruscoe said, "A tremendous amount of out-of-town buyers. Our primary client comes from the LA area or the Bay Area. We see a lot of them coming in and buying properties, even coming in now when the prices are moving up quickly because they know they can rent those."

Oliver said the Merced market has cooled just a little bit. He no longer was seeing people bid $20,000-$50,000 over the asking price anymore.

Oliver continued, "We are still seeing usually two-five offers, multiple offers, but the asking price versus the offer price is $5,000-$10,000 within the listing price."