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Salton City: A land of dreams and dead fish

New homes and old optimism continue to sprout in a desert community that hasn't really jelled in 50 years.

July 01, 2007|David Streitfeld | Times Staff Writer

SALTON CITY, CALIF. — This lakeside hamlet is about as remote as you can get in Southern California and still have plumbing and pavement.

Nestled on the western shore of the Salton Sea, the town doesn't have a supermarket or movie theater or drugstore. But it has as many as 250 homes for sale, most of them newly built -- a huge supply for a place with just 1,440 people.

When real estate values began soaring a few years ago, builders flocked here. Summer temperatures might hit 115 or even 120 degrees and the sea may be too sickly for swimming or sailing, but land was cheap. Builders figured that people priced out of Los Angeles and San Diego would discover Salton City and the other towns in Imperial County.

Now, with home values sliding, mortgage rates edging up and gasoline prices on an upward trend, that assumption appears premature at best. Imperial County, at least for the moment, seems a subdivision too far.

"Builders are like lemmings. They saw a few of their peers going to Imperial County and they all joined in," housing consultant Patrick Duffy said. "They didn't do market studies. They just crossed their fingers."

Developers counter that history is on their side. The quest for three-bedroom detached homes has turned one rural area after another into a thriving new suburb over the last 60 years, from the San Fernando Valley to Rancho Cucamonga to La Quinta.

As one place gets too crowded and expensive, new buyers push on to the next, stretching their commute in exchange for a backyard barbecue and easy monthly payments.

Mitchell El-Mahdy moved to Salton City last year. First he bought a house as an investment, then he decided to live in it.

"I like the stark beauty and the way the light plays against the mountains," said the retiree from Studio City. "I haven't felt such tranquillity in years."

El-Mahdy thinks his new hometown has a splendid future, one he hopes to help bring about as president of the local Chamber of Commerce. Doubling down on his investment, he recently bought the house next door.

The builders are hoping for more retirees like El-Mahdy as well as families from Mexico who want to take advantage of U.S. schools. Another market: the growing number of Border Patrol agents and prison guards in the area. And then there's anyone who doesn't mind a little commute. San Diego is two hours across the desert on Interstate 8, Riverside about the same along I-10.

Suburbia would be quite a transformation for a county traditionally known for being poor, agricultural, broiling and on the way to nowhere. The El Centro metropolitan area -- Imperial County's urban center, such as it is -- had an unemployment rate in April of 16.3%, by far the highest of the 369 U.S. metro areas.

The county's working-class present and middle-class hopes for the future are displayed in the city of Brawley, population 22,000. In the first category are the Villa Serena apartments, whose two-bedroom "luxury" units are available for $630 a month, about the going rate for the area.

Not far away is the Ranch, a 273-house project by Stockton-based Matthews Homes that is just getting underway. A steady stream of potential buyers has come to check out the models, which cost up to $355,000 for a four-bedroom, 2,600-square-foot home. Sales agent Teresa Castillo said she had sold three. However, two of the deals are "shaky. The buyers are having credit issues," Castillo said.

Matthews Homes, which is also planning projects in El Centro and Calexico, declined to comment on its Imperial County developments.

In a tightened lending environment, it's common for deals to fall through or for buyers to simply change their minds. New-home sales in Imperial County in the first four months of 2007 totaled 259, according to DataQuick Information Services, down sharply from 677 in the same period a year ago.

Although homes are cheaper in Imperial County than on the coast, wages are lower as well. The 2005 median household income was $35,533, according to the Census Bureau, about one-third less than the statewide median. Salton City is considerably poorer than the county as a whole.

Nevertheless, deals are getting done. Credit the rock-bottom prices. Some brand-new homes sell for less than $200,000 and, thanks to the oversupply, are getting even cheaper.

Real estate agent Aimee Sisco, working with a colleague, has represented four buyers since March. Next month Sisco herself is moving to Salton City from a Palm Springs suburb.

"This place is a little nutty, a little out there," Sisco said. "But you can't get any cheaper. It's actually a place that people can afford to live."

One of her clients was a retired Latino couple from Los Angeles who wanted to be midway between their families in Mexicali, Mexico, and L.A. Another was a younger couple who bought as an investment; the husband, who is in the military, spends several days a week in San Diego. A day laborer and his wife sold their San Bernardino house to move here.

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