South Shore Lake Tahoe

The dog days of summer are upon us as we ramp up for the real estate activity in the Tahoe South Shore which almost always grows progressively through the start of summer and until the end of October. The Tahoe Fall season has become a popular time for our tourist guests to visit us and I expect we’ll see this seasonal trend again this year. 

Although there’s certainly been no “usual” anything the past few years, what with the unprecedented run up of prices from 2001 to early 2006 only to be followed by an unprecedented down turn in the market (in well over the past 20 years).

But what a difference a year makes (or 2-3)
 
At this time in 2007 we were recovering from a horrific fire storm that had not only destroyed 250 homes but more damaging was the destruction to the lives of as many families. As small communities are want to do we pulled together and rallied around the fire survivors, opened our doors and hearts and started the healing.
Today many of the families are returning to their “new and improved” custom homes or have simply moved on with other housing options. There are still the scars that remain but the “Angora Hills” area, once a lunar scape is now a bustling sea of construction and positive energy focused on renewal.
Mind you this a site that must be seen for it is an anomaly, particularly given the current state of housing and the economy downturn on so many fronts, all of which has hit realestate hard and makes this scene a bit surreal.

What do the numbers look like since the down turn in the realestate market?

For most of us with our ear to the ground in this industry, we knew that the market couldn’t sustain the continued upwards climb in pricing; there wasn’t an interest rate low enough to offset the high prices and certainly our incomes weren’t growing at the pace of inflation let alone housing prices.

Although the market came to an abrupt halt in October of 2005 the statistics (see attached) show the median home price of “homes sold” climbing until May of 2006 to an all time high of $486,000 approx. However since then the prices have slowly and steadily declined at almost 1% per month to give us an overall decline in price since the peak in May 06 of 21% or $399,000.00 for the same, home sold at the time of this writing.

Unintended Consequences and Help is on the way?

No one wants to see their home prices dropping and the terrible consequences it can have on equity (what’s left of it for so many).
However it is a market place condition that must be observed. We have so little control as consumers; even the lawmakers with the billions of dollars they are pumping into the credit and financial markets seem to have had little immediate impact. But we are hopeful the government assistance with GSEs will shore up the shaky credit markets and provide options to the hundreds of thousands who are facing upside down pricing to mortgage scenarios.

Some Good News with a touch of reality!

That said, the bright news is that due to the new levels of affordability (pricing), buyers are coming back in to the market place, this not perceived but rather real. Here’s the new trends information that I have observed;
Since January of 2008 we have seen, on an average, the year over year pending sales numbers increasing and have continued to do so for over 7 months.  Certainly in our office we are up over 20% in pending and closed sales from this time last year.

While the number of sales that are picking up, comparatively to the past early 2000 years, is nothing to brag about per se, it is a very good indicator that buyers, who have waited out the market, are returning.
These people need and want a roof over their heads and in our market a resort home’s roof over their heads. They have waited for the right time to buy and are doing so with one very clear caveat; the value must be strong, pricing is subject to negotiations. Having a great negotiator on your side (either side is critical) but ultimately it takes a win – win to put a sale together and a knowledgeable team to close them (even more important these days).
What is attracting the buyers back in to the market is the lure of a great bargain; short sales, foreclosures and “killer deals”, and there are plenty to be had, even in our resort market.
Consequently the sale prices have declined to reflect the notes made above.
Currently Sales are up (slightly) Prices are down-
Forecast for the next year-
 
If the economy can remain relatively stable along with interest rates I believe we’ll see the housing market emerge as one of the growing markets again.
Resort realestate is an interesting barometer of the economy, we are viewed generally as a “luxury lifestyle” purchase but of recent years, with the aging population and demographics, our market has become a safe “investment” option for those that have money to shelter and invest. The returns are great not only in the “roi” approach but in the enjoyment department too. With the 1031 tax rules in place and the conversion rules of your investment property into your primary (which have recently undergone some changes, check with your accountant) many are converting heir vacation rentals into their retirement homes and/ or moving to Tahoe and telecommuting. 

While I do see prices continuing to settle, certainly until the foreclosures and distressed sellers are out of the inventory, I believe we are near or at the bottom of the market in terms of bargain pricing.

Supply (down) and demand (up) and no doubt the next few months will tell the story, and we’ll keep you posted of course.
For more information go on our web site www.realtordeb.com or email us at deb@realtordeb.com
Or call us toll free 1-866-542-2912

It is our pleasure to earn and retain your business!
We wish you and yours a fabulous fall season and hope your summer was all you wanted it to be, with plenty of Tahoe time!

Best Wishes

Deb Howard
Broker/Owner
NV/CA
3599 Lake Tahoe Blvd. Ste.A
South Lake Tahoe, CA 96150
deb@realtordeb.com

Here is the latest foreclosure list for South Lake Tahoe. There are 11 foreclosures on the market. They are all single-family residences (no condos or multiplexes).

Since the last foreclosure list, there have been a few interesting developments in the foreclosure market. A few properties were just listed. The only one I’m really excited about, though, is 2604 Knox Ave. It is located on a rare 1/4 acre lot in Sierra Tract. I think there could be a ton of value in that purchase. I’ll drive by it tomorrow and post a comment with my thoughts on it.

The only other foreclosure steal that is new to my list is 2508 Cold Creek Trl. It fell out of escrow recently. It’s located in Montgomery Estates, which is one of the most prestigious neighborhoods in town.

There were some significant price reductions on the foreclosure list. In the last two weeks 2587 Kubel Ave. went into escrow, fell out, and then saw a 10% price reduction down to $224,900. Wow! 3705 Montreal Rd. also experienced a huge reduction. It went from $339,900 to $309,000. Both these properties could be sold before my next list comes out in two weeks. (Montreal may remain because it needs a ton of work.) 1612 Choctaw was reduced $24,500 to $474,500.

I have more information on properties that will become foreclosures. However, I don’t feel at liberty to publish this information on the internet. If you are interested in those properties or the ones on this list, call me at (530) 545-1831.

Address	Bed/Bath/ Gar	Square Feet	Days on Market	Price
2587 Kubel Ave.	2/1.75/0	1003	57	$224,900
2734 Knox Ave.	2/1/0	1042	51	$250,000
1414 N. Upper Truckee Rd.	3/1/0	1040	8	$300,000
3705 Montreal Rd.	4/2/0	2035	58	$309,000
733 Zuni St.	4/2/0	1886	111	$340,000
2604 Knox Ave.	4/2/1	2210	6	$379,900
864 San Francisco Ave.	3/1.75/0	1848	256	$390,000
2508 Cold Creek Trl.	3/2/2	1960	97	$429,900
2638 Lipan St.	3/2.5/2	2286	153	$467,500
1612 Choctaw St.	6/4/0	2489	10	$474,500
967 Colusa St.	3/2.5/2	2286	9	$525,000

South Lake Tahoe Real Estate
The South Tahoe Realty Blog

Always trying to improve the real estate statistics I present to you, I’ve decided to mine for a new stat – median sale price for the last 90 days. I will present this statistic along with the median sale price for the last month. See the table below for the actual numbers. And for more articles on real estate statistics and South Lake Tahoe Real Estate, see The South Tahoe Realty Blog at www.SouthTahoeHouses.com.

What are the benefits of looking at the median sale price for the last 90 days? First, it helps minimize some of the incredible variance that occurs in a small market like South Lake Tahoe. A few high priced sales can throw off the median sale price for a single month here in South Lake. This isn’t so true when looking at sales over a 90-day span. Second, the 90-day statistic centers on a date 45 days in the past. The commonly accepted monthly median sale price centers on a date 15 days in the past. Thus, we get three times more homes, which minimizes variance, and only lose a month when it comes to keeping our stats current. If you are yet to be convinced, look at the table below. For any given month, the median price for the last 90 days, more often than not, produces a better reflection of market conditions than the median price for the month.

For those of you who’ve been following my statistical reports, you’ll notice that I’m no longer calculating median sale price over the last year (a.k.a. 12-month moving median). The statistic just doesn’t make sense to me. It’s good for looking at real estate history; and this is only true if the reader knows the data centers on a date 6 months in the past. Presenting it as current information on a month-to-month basis, however, just doesn’t make any sense.

As for now, we’re still seeing a lot of homes in escrow. We’ve had 60-70 homes in escrow at any given time in the last 2-3 months (the numbers I took from STAoR for the months previous to this one are low somehow.) And we’re finally seeing an increase in homes sold, but it still should be higher. Look at the numbers in 2005 when the market was at its peak. About 65% of escrows closed at that time. Right now we’re seeing about half close. I know a knowledgeable real estate professional who suggested that perhaps we have a bunch of really long escrows sitting out there. This would keep many of our escrows from closing. This isn’t the case, however. When I looked through South Lake Tahoe’s escrows a week ago, only 14 out of the 70 had been in escrow for more than 60 days. I think it’s just that a larger percentage of homes are falling out of escrow than we’ve seen in the past. With a tight lending industry, most buyers probably aren’t qualifying for loans. So if you’re a seller here in South Lake Tahoe, don’t be too upset about your home falling out of escrow. It’s happening to everybody.

I’ll do my best to bring you more statistics in the next week. I was only able to go back to the beginning of 2007 with the 90-day median sale price. I’d also like to give you some foreclosure, condo, and lot numbers. It’s just a very, very busy time for real estate here in South Lake Tahoe.

Month & Year	Listings at Month's End	Escrows at Month's End	Homes Sold	Median $ Over Last 90 Days	Median Sale $
July 2008	494	64	36	$396,000	$391,500
June 2008	465	57	30	$392,000	$365,000
May 2008	414	47	31	$396,000	$415,000
Apr 2008	372	44	21	$387,000	$379,000
Mar 2008	361	40	34	$402,500	$387,500
Feb 2008	374	52	16	$445,750	$412,500
Jan 2008	366	33	16	$466,500	$428,000
Dec 2007	382	28	34	$460,000	$502,000
Nov 2007	403	42	27	$415,000	$460,000
Oct 2007	353	15	39	$415,000	$425,000
Sept 2007	442	30	30	$415,000	$398,250
Aug 2007	538	45	38	$437,500	$421,500
July 2007	557	40	25	$440,000	$435,000
June 2007	552	33	35	$435,000	$440,000
May 2007	522	47	32	$465,500	$460,000
Apr 2007	423	32	28	$474,000	$392,500
Mar 2007	359	37	30	$482,500	$507,000
Feb 2007	327	25	25	$485,000	$492,500
Jan 2007	331	37	21	$475,750	$395,750
Dec 2006	339	29	40		$497,500
Nov 2006	362	50	44		$483,500
Oct 2006	411	55	53		$450,000
Sept 2006	463	63	31		$442,000
Aug 2006	548	46	36		$427,500
July 2006	571	49	37		$475,000
June 2006	532	51	37		$480,000
May 2006	424	50	35		$465,000
Apr 2006	302	50	32		$504,000
Mar 2006	264	39	38		$485,140
Feb 2006	262	51	21		$489,000
Jan 2006	256	32	20		$508,750
Dec 2005	198	n/a	31		$450,000
Nov 2005	282	42	53		$455,000
Oct 2005	300	69	55		$485,000
Sept 2005	313	93	63		$495,000
Aug 2005	270	96	79		$510,000
July 2005	209	110	74		$484,500
June 2005	188	113	65		$456,000
May 2005	172	96	57		$495,000
Apr 2005	116	91	72		$488,500
Mar 2005	88	83	50		$440,000
Feb 2005	72	86	34		$449,500
Jan 2005	85	63	47		$405,000

Price Range	Active Listings	Absorption Rate in sales/mo. (% of inventory)	Months Supply of Inventory
$0 - $300,000	33	4.92 (14.91%)	6.7
$300,001-$500,000	195	13.75 (7.05%)	14.2
$500,001 - $750,000	131	6.08 (4.64%)	21.5
$750,001 - $1,000,000	63	2.50 (3.97%)	25.2
$1,000,001 - $2,000,000	56	1.83 (3.27%)	30.6
$2,000,001 and up	16	0.08 (0.52%)	192

South Lake Tahoe Real Estate
The South Tahoe Realty Blog

H.R. 3221, the “Housing and Economic Recovery Act of 2008,” passed the House on July 23, 2008, by a vote of 272-152. On Saturday, July 26, 2008, the Senate passed the bill by a vote of 72-13. The President signed the bill on July 30, 2008. The bill includes the following provisions:

• GSE Reform – including a strong independent regulator, and permanent conforming loan limits up to the greater of $417,000 or 115% local area median home price, capped at $625,500. The effective date for reforms is immediate upon enactment, but the loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008).
  View 2009 FHA and GSE loan limit estimates (PDF)

• FHA Reform – including permanent FHA loan limits at the greater of $271,050 or 115% of local area median home price, capped at $625,500; streamlined processing for FHA condos; reforms to the HECM program, and reforms to the FHA manufactured housing program. The downpayment requirement on FHA loans will go up to 3.5% (from 3%). The effective date for reforms is immediate upon enactment, but the loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008).
  View 2009 FHA and GSE loan limit estimates (PDF)
  FHA Reform Chart (PDF)

• Homebuyer Tax Credit - a $7500 tax credit that would be would be available for any qualified purchase between April 9, 2008 and June 30, 2009. The credit is repayable over 15 years (making it, in effect, an interest free loan).
  First-time homebuyer tax credit chart
  Frequently asked questions about the first-time homebuyer tax credit

• FHA foreclosure rescue – development of a refinance program for homebuyers with problematic subprime loans. Lenders would write down qualified mortgages to 85% of the current appraised value and qualified borrowers would get a new FHA 30-year fixed mortgage at 90% of appraised value. Borrowers would have to share 50% of all future appreciation with FHA. The loan limit for this program is $550,440 nationwide. Program is effective on October 1, 2008.
  FHA Foreclosure Rescue Chart

• Seller-funded downpayment assistance programs – codifies existing FHA proposal to prohibit the use of downpayment assistance programs funded by those who have a financial interest in the sale; does not prohibit other assistance programs provided by nonprofits funded by other sources, churches, employers, or family members. This prohibition does not go into effect until October 1, 2008.
  More about the seller-funded downpayment assistance provision
  Tips to finding downpayment assistance programs (PDF)

• VA loan limits – temporarily increases the VA home loan guarantee loan limits to the same level as the Economic Stimulus limits through December 31, 2008.

• Risk-based pricing – puts a moratorium on FHA using risk-based pricing for one year. This provision is effective from October 1, 2008 through September 30, 2009.

• GSE Stabilization – includes language proposed by the Treasury Department to authorize Treasury to make loans to and buy stock from the GSEs to make sure that Freddie Mac and Fannie Mae could not fail.

• Mortgage Revenue Bond Authority – authorizes $10 billion in mortgage revenue bonds for refinancing subprime mortgages.

• National Affordable Housing Trust Fund – Develops a Trust Fund funded by a percentage of profits from the GSEs. In its first years, the Trust Fund would cover costs of any defaulted loans in FHA foreclosure program. In out years, the Trust Fund would be used for the development of affordable housing.

• CDBG Funding – Provides $4 billion in neighborhood revitalization funds for communities to purchase foreclosed homes.
  More about the CDBG funding provision

• LIHTC – Modernizes the Low Income Housing Tax Credit program to make it more efficient.

• Loan Originator Requirements – Strengthens the existing state-run nationwide mortgage originator licensing and registration system (and requires a parallel HUD system for states that fail to participate). Federal bank regulators will establish a parallel registration system for FDIC-insured banks. The purpose is to prevent fraud and require minimum licensing and education requirements. The bill exempts those who only perform real estate brokerage activities and are licensed or registered by a state, unless they are compensated by a lender, mortgage broker, or other loan originator.

 

So I woke up this morning to cumulus clouds billowing overhead!! Its been in the mid eighties with some gusty winds all weekend but now we get to see some thunderstorm action. August seems to be the best month to see the thunderstorms develop over the sierras. Come join us in a cool down before the temperatures climb back up into the eighties this weekend.

If your in the Tahoe basin and want sometimg funa nd educational to do with your family, come celebrate the vibrant cultural traditions of Tibet at Valhalla in the beautiful Tallac Historic Site just 10 minutes south of Emerald Bay at Lake Tahoe on Aug. 25-29 and Aug. 31. Experience a wide range of events giving insight into the culture of Tibet. Immerse yourself in rich Tibetan tradition with friends and family. Ven Losang Samten, renowned Tibetan Scholar, spiritual teacher and artist, will return to Valhalla to teach and create a Medicine Buddha Sand Mandala, the centerpiece of the festival. Losang’s ability to incorporate the qualities of practicing loving kindness, patience, and understanding with those he meets has touched the hearts of many. The purpose of this festival is to share and preserve the unique arts and culture of Tibet and to raise awareness of the situation in Tibet. For more information go to http://www.tahoedailytribune.com/article/20080801/NEWS/23779007/1061&parentprofile=1061. See you all there

Tip for Improving Gas Mileage

RISMEDIA, July 19, 2008-

The summer vacation season is getting in full swing and fuel prices are rising faster than the temperature. But drivers can stretch each tank of gas by roughly 10% with simple driving tips and smart car care solutions from 3M Car Care. “Over the life of a car, poor fuel efficiency and excessive fuel use can lead to hundreds, if not thousands of dollars in added expense,” said John Marmar, U.S. business manager, 3M Car Care products. “Properly maintaining the vehicle and watching your driving style are two of the best ways to maximize fuel efficiency and reduce long term expenses.” 3M Car Care offers six tips to maximize your car’s fuel performance.

1. Check tire pressure - Improperly inflated tires can greatly reduce fuel economy, so make sure tires are inflated to the manufacturer’s recommended pressure listed on the inside of the driver’s side door. The correct tire pressure will also provide a safer ride and help reduce tire wear.

2. Let your engine breathe - Replacing a dirty, clogged air filter will go a long way in improving fuel efficiency. According to the federal government, a car’s gas mileage could improve by as much as 10% with a clean air filter. In addition to the fuel savings, the new filter will help protect the engine.

3. Keep the fuel system clean - Carbon and resin buildup in a car’s fuel system reduces fuel efficiency. You can clean the entire fuel system with the new 3M DIY Fuel System Tune Up Kit. With just one tool and 45 minutes, it cleans the engine, fuel injectors, intake manifold, intake valves, combustion chambers and throttle plate with the same trusted 3M products used by automotive professionals. Keeping the fuel system clean helps maximize the engine’s performance, extend the life of the engine and improve mileage.

4. Keep it cool inside - Summer heat requires air conditioning, but AC can account for up to 5% of a car’s fuel consumption. Using 3M Crystalline Automotive Window Film can keep the sun and heat at bay - making the vehicle cooler and reducing the demand on a vehicle’s air conditioning system. Even better, 3M Crystalline Automotive Window Films offer many of the benefits of darker window tints, with the option of being virtually clear in color.

5. Take it easy and slow down - Driving a car at a high speed, “jackrabbit starts” and aggressive driving in traffic can greatly reduce fuel efficiency. The U.S. Department of Energy says “As a rule of thumb, you can assume that each 5 mph you drive over 60 mph is like paying an additional $0.20 per gallon for gas.” And every time you “hit the gas” you get closer to the next refill. 6. Put your car on a diet - Remove any unnecessary, heavy objects in the vehicle. An extra 100 pounds can reduce fuel efficiency by as much as 2%. Even removing golf clubs can help lighten the load.

For more information, visit www.3Mcarcare.com.

The Lake Tahoe market has shown signs of of improvements in terms of units pending and sold over the past 6 months year over year.

That's good news and I'm suggesting this is a trend as apposed to an anomily. However the dark lining on this bit of trend news is that the price point has been declining.. at about 1% per month over the past 18 months (see South Tahoe Association of Realtors stats).

While we're seeing the increase in activity, the market trends are showing the attraction (from buyers) to be driven by and to the "best deals" which, in our most recent market, looks like foreclosures, short sales and distressed.

Time to buy!

 

I saw on the local news last night, that single family home sales in nearby Reno were up some 24% over last Year.  After a 13% price correction, I can understand why.  Home sales are up in many locations across the country after an 18 month decline.  With interest rates still low it just makes sense to buy at these prices.  Experts that I've seen on the financial tv networks say that in past housing price declines the bottom is vee shaped and prices tend to rebound quite dramatically.  Let's hope so. 

We're alive and well dispite the smoke which only slightly put a damper on the Elvin Bishop charity concert at Horizon Casino on Tuesday june 24th.

More to follow.