Top story of 2002: SLO County home prices soar through the roof

Editor's note: Here is the story Tribune staff chose as the biggest story of the year in 2002. The article, originally published on Jan. 1, 2003, is reprinted below.

Housing prices soared in San Luis Obispo County in 2002, creating instant nest eggs for many homeowners, but at the same time derailing the dreams of families priced out of the market.

In January, the county's median-priced home hit $310,000 — then a record — and by August, it had climbed to $350,000.

"It's like, oh my gosh, they're closing the door in our faces," said aspiring homeowner Estella Vazquez of Grover Beach.

She and her husband, Martin, saved for years for a down payment on a $200,000 home, only to be locked out of the market by escalating prices.

The Vazquez family, first profiled in The Tribune's June housing series, has one more lead to pursue.

If that doesn't work out, the couple and their three children will leave the county for somewhere more affordable, possibly the San Joaquin Valley.

The Vazquezes are by no means alone.

Fewer than one in four families in the county earned enough money to be able afford a house. That statistic earned the county the dubious distinction of being the fourth least affordable housing market in the nation, according to the Home Builders Association.

The market shows no sign of weakening. The UCSB Economic Outlook projects the county's median home price will reach $500,000 by 2007.

The escalation of housing prices had some far-ranging effects.

It contributed to a nearly 10 percent rise in the assessed value of property within the county. Annual increases are generally more modest, in the 4 percent to 6 percent range, according to the county Assessor's Office.

The assessed value of all secured properties — which includes residential, commercial and industrial categories — rose by nearly $2 billion, to $23 billion.

On the downside, the county lost one of its most respected employers, guitar maker Ernie Ball, due in part to high housing costs.

In some communities, school enrollments dipped or began to level off. Administrators put much of the blame on a housing market that was especially tough on young families struggling to buy a first home.

"I'm of the opinion — I'm of the fear, I guess — we're turning into another Santa Barbara," said Mike Sears, assistant superintendent of the South County's Lucia Mar school district.

The resignation of David Horsey, the popular principal of San Luis Obispo High School, fueled worries of an exodus of professionals.

"I was very satisfied with the district and the job. It was more about housing costs," Horsey said back in May, when he announced he was leaving for a job in the Northern California community of Auburn, where the average home was selling for $257,000.

But for all the negative news on the housing front, 2002 may also be remembered as the year that galvanized community leaders to act.

The San Luis Obispo Chamber of Commerce named high housing costs as the top problem facing the community and formed a task force that recently issued a position paper with 20 recommendations — from rezoning more land for residential use to combating the not-in-my-backyard syndrome.

A nonprofit group working to set up a housing trust fund scored a victory at year's end when the county Board of Supervisors pledged $225,000 in seed money. The funds will be used to set up an office and hire an executive director, in the hope of raising millions of dollars in financing to build reasonably priced homes.

Yet that may not be soon enough for families like the Vazquezes.

They are renting a two-bedroom apartment, which means their three girls, 16, 11 and 5, have to share a single room, and aren't allowed to have a coveted family dog.

"The middle one asks everyday, 'When are we going to have a house?'" said Estella Vazquez.

Though the family would love to stay on the Central Coast, even the girls are resigned to moving at this point.

"I think they would," she said, "just because they're so desperate."