Ontario Ranch top master-planned community in California, followed by Valencia

Master-planned communities have attracted buyers and homebuilders for almost five decades in California.

But the state that boasts some of the first, largest and most successful master-planned communities – think Irvine Ranch and Valencia in Southern California – continues to lose ground to Florida, where massive projects dominate a closely watched industry report.

California had six communities crack John Burns Real Estate Consulting’s Top 50 list of master-planned communities for 2022, but none were in the top 10 and only two were in the top 20.

According to the annual report, those six communities had a combined 2,844 homes sold in 2022, down 4.5% from 2021 – and off 44% from just three years ago.


Fast-rising mortgage rates, which almost doubled between the first months of the year and the end of 2022, coupled with a significant shortage of materials and supplies, are primarily to blame for the decline.

Ontario Ranch was the best-selling master-planned community in California, with 646 homes, a 36% decline from the 1,011 homes in 2011. Ontario Ranch finished No. 13 on the national list.

Valencia, arguably one of the most successful master-planned developments ever in the nation, had 594 homes sold in 2022, up 71% from a year ago. River Islands near Stockton was the third best-selling community in California, with 463 homes, a 36% drop from the 316 homes in 2021.

Nationwide, almost 21,100 homes were sold in master-planned communities in 2022, down 7% from 2021. Seven of the 10 best-selling master-planned communities were in Flora, including the top-ranked The Villages. The development sold more than 3,900 homes in 2022, or about 1,100 more than the six communities combined in California.

Top-selling master-planned communities in California

Rank in the U.S.CommunityHome sales in ’22Home sales in ’21% gain/loss
13Ontario Ranch6461,011-36%
28River Islands-Stockton463545-15%
343 Roots San Diego429316+36%
43Otay Ranch in Chula Vista368346+6%
49The Preserve at Chino344432-20%

Every day buyers stand alone as many investors bow from the housing market

If you need any more evidence that the housing market has entered a recession, just check how investors are fleeing the scene.

Investors bought 18% of the homes sold in fourth-quarter 2022, a 46% decline compared to a year ago – the largest-ever drop since 2000, according to industry tracker Redfin. Investor deals plummeted 45% in 2008, when the housing market was battling the subprime mortgage crisis.  

Higher mortgage rates, declining growth in rental rates and a possible drop in home prices are causing investors to look at other investments. 

While investors accounted for almost one of every three homes sold during the past three years, that rate has tumbled to less than one of every five in the final three months of 2022.


The bidding wars for homes from spring 2020 through spring 2022 have become a deep freeze and yearlong winter for homeowners looking to sell. The average home enters escrow in about three weeks, but many are taking a few months or more on the market, according to housing experts.

Las Vegas and Nevada have experienced the largest decline in investor deals, off 67% from a year ago. But Sacramento and Riverside had the eighth- and ninth-largest drop in investor purchases. (See chart how investor deals have declined by cities in California.)

Wanna-be buyers, many of who have been waiting for a cooler housing market for the past two years, will benefit from fewer folks looking at homes. But they still face the challenge of affordability, with fewer than one of every five households in California able to buy a median-priced home, according to the California Association of Realtors. 

“It’s possible that investors will start to wade back into the market this year given that mortgage rates have ticked down from their 2022 high, especially if home prices show signs of bottoming,” says Redfin senior economist Sheharyar Bokhari. “But it’s unlikely that investors will return with the same vigor they had in 2021. That’s good news for individual buyers, who are still grappling with high housing costs but no longer losing bidding war after bidding war to investors.”

Fewer investors are buying homes in California compared to a year ago

City% of sales to investors% gain/loss from a year ago
Los Angeles19.5%-43.1%
San Diego20.6%-47%
San Francisco20.9%-37%
San Jose14.4%-37%

Source: Redfin

FHA cuts mortgage insurance premiums

Uncle Sam is helping homebuyers, again.

The Department of Housing and Urban Development (HUD), through the Federal Housing Administration (FHA), has cut the annual mortgage insurance premiums by 30 basis points for homeowners with FHA-insured home loans.

The action will save the average U.S. homeowner with an FHA-insured mortgage about $800 per year – and more than $1,500 in California. The cost cut could help open the door to home ownership and improve generational wealth for families, especially Black and Latino households. 

For this country to truly succeed, all Americans must have access to opportunity. That means expanding access to wealth-building and home ownership,” says HUD Secretary Marcia L. Fudge.

“Today, we are building on the steps we’ve taken to make homeownership more affordable, and HUD is acting to ensure people feel comfortable purchasing a home as they build toward their future. As we reduce housing costs for people with FHA mortgages, we continue our work to address longstanding disparities in homeownership.”

FHA had increased the mortgage insurance premium following the housing collapse during the Great Recession in 2008, promoted by the subprime mortgage crisis.

The decline in mortgage premium insurance affects single-family houses, condominiums and manufactured homes.

The decision to “lower the annual mortgage insurance premium on FHA loans by 30-basis points will help increase homeownership opportunities throughout California, especially for first-time homebuyers and working Californians who rely on FHA financing,” says Jennifer Branchini, president of the California Association of Realtors (CAR). “HUD and FHA play a pivotal role in providing housing opportunities for families throughout California, and for years, CAR and (the National Association of Realtors) have asked the FHA to lower the mortgage insurance premium to ensure that homebuyers using FHA loans are not overpaying for their mortgages.”   

In January, Fannie Mae and Freddie Mac increased loan limits for borrowers, with some regions enjoying mortgages of more than $1 million.