New homes are being built in the Merced County area

MERCED COUNTY, Calif. (KFSN) -- 23 new homes are coming to the gated community of Jacob's Ranch in Atwater, and five of them are nearly finished. It's just one of the many projects developer and farmer Greg Hostettler has underway.

Hostettler said, "About 6 months ago we were planting trees and a neighbor said Greg it's time for you to stop planting trees and go build homes again. We want new homes, we haven't had new homes in 7 years."

Hostettler agreed the timing was right, but he started cautiously with just a few houses. Now he's also building dozens of others in Merced and Los Banos, including a neighborhood off Mercy Springs Road.

"We think we're doing our part with the creation of new jobs now, cement mixers are turning, hammers are banging, at a good healthy rate," said Hostettler.

Sales Representative Paula Angel says she decided to retire during the housing crash, but now she's also back to work.

Hostettler added, "It was just time to come back, and it's an exciting time."

Real estate agents say the improving economy, low interest rates, and profit potential for builders have all helped bring the market back to life.

Realtor Andy Krotik said, "The real estate industry is definitely on the uptick. In our office we've had two months this year that have been the highest in home sales in over 5 years, so it's very optimistic for home sales."

Krotik says prices have gone up 33 percent in the past two years, and he expects that trend to continue.

"It's nice to be able to talk positively about the real estate market after talking negatively over the last decade, so it's welcome, welcome back," said Krotik.

Krotik said one other trend he's seeing right now is a huge surge in renters. His company manages about 800 rental homes, and only has five available.