La Cañada feeds builders’ appetite for construction

Local Realtor Sid Karsh loves what he sees happening all around his Berkshire Avenue home — big, new houses going up here and there with story poles revealing the potential shapes of other new residences in the making.

“I look around and think, what’s going on? It’s amazing; it’s like a new subdivision,” he said. “I’ve had two flat tires recently because of all the construction, people leaving things out on the road.”

All indicators seem to point to the fact that the business of building is a booming one in and beyond the Flintridge area, which typically means a steady stream of work for architects, contractors and Realtors like Karsh.

But it’s also good news for the city itself, which benefits directly when applicants pay for permits and plan checks on building projects but also more generally as rebuilds and renovations increase property values, according to Community Development Director Robert Stanley.

Strong and steady property values have kept La Cañada’s housing market opportunity rich, even through lean recession years, when the number of short-term property investors receded and were replaced by those with bigger budgets and a longer range of vision, Stanley explained.

These days, property values have continued to climb as more people rebuild and renovate their homes. Citywide assessed value was estimated at $6.82 billion in 2015, with gains made every year since 2010.

“We have housing stock in this town that dates back to the 1920s,” Stanley said. “I think it’s always good to have a constant improvement of those older homes. That keeps up the home values.”

Stanley reported the number of people seeking permits and approvals for construction projects has grown and is now on pace with pre-recession figures. In 2007, the city processed 344 planning permit applications. But by 2009, that number fell to just 215, a decrease of nearly 63%.

“[The year] 2009 is when we really felt it,” Stanley said. “I think people were kind of holding back to see what would happen.”

Kurt Knechtel, partner and vice president of La Cañada’s Behr Construction, recalled how several clients began to scale back on the size and scope of home renovation projects when the housing market started to decline. But it wasn’t too long before the work began to pick up.

“The market kind of hit bottom, then everything started to grow again,” Knechtel said of local projects. “Now we’re seeing people build bigger additions, or tearing down a home and building a new home.”

In the past three years, La Cañada has seen a renewed appetite for new construction, processing 301 applications for building permits last year. Revenues coming into the city from permits and plan check fees — which are based on the assessed valuation the construction will add to a property — have also increased.

For example, the city received about $1.87 million from such fees in Fiscal Year 2014-15, compared to $1.43 million in 2012-13. Stanley said that value-based figure is a strong indicator of growth, one that points to continued stability.

And Karsh agrees.

“This is a real solid growth that’s not stoked by the zero-dollar down payment,” he said of the market. “Here we are in 2015 and we’re higher than we were at the top of the market. I love it. I see what’s going on around here and it makes me feel really good.”