California housing boomlet frustrating home buyers

MERCED, Calif. _ Last month, Daniel and Laura Eckman were hours from signing a contract to buy their first home for $235,000.

It was triumphant moment for the husband and wife, who are both 31-year-old high school teachers. They'd spent the past six months trying to find a house where they'd eventually start a family.

Their goal was simple. They wanted a home priced about $250,000 in an older neighborhood where houses were built with backyards. They didn't want to live in a recently built subdivision where the homes are crammed together.

The first offer they made, back in January, was on a short sale _ a deal when the current owner owes more than the home's worth, and the bank is willing to take the loss. It took Bank of America three months to deny their offer.

The Eckmans were poised to sign the contract on their latest offer and begin escrow. Then their agent called. Out-of-town investors had swooped in with an offer of $240,000 that the bank had accepted.

"You go out and you have a romanticized version of buying a house," Daniel Eckman said Friday. "Then you get out there and everything's killed."

All told, they've looked at about 25 houses and made four offers. Still, no home.

Once again, local buyers are getting squeezed out of the Merced market because of a short supply of houses and a spike in investors loaded with cash. Despite low asking prices, many homes being bid up because of the high demand.

Call it a recession-era feeding frenzy.

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