Home prices still on the rise
If you are looking to buy a house in Truckee this year expect to dole out a half-million dollars or more.
The median price of a home in the area climbed by more than $100,000 from 2003 to 2004, setting the median home price at $539,900 in a region that includes Truckee, Squaw Valley and Alpine Meadows, according to a year-end market report by Chase International.
The 24 percent jump in a one-year period outpaced increases around the entire Lake Tahoe area, except for Tahoe City, which grew at the exact same 24 percent rate, according to the report. The median home price in town stood at $435,000 at the end of 2003.
For those who already own a home in the area, the news of their investment’s appreciation is welcome. To those who live in the area and still hope to buy into the market, housing prices seem to skyrocket farther and farther from reach.
Ron Hemig, a real estate broker with Hemig and Erle Real Estate in Truckee, said one effect of rising home prices is a spillover influence on neighboring areas like Sierra County. As out-of-area buyers drive up prices in Truckee, Hemig said he sees more and more local owners cashing in and moving to Loyalton, Sierraville and Graeagle. And those locals that have not bought a house in town are often tempted by the lower mortgages in the Sierra Valley.
“The buyer for the valley is generally from Truckee,” said Hemig, whose company lists properties up and down the Sierra Valley. “There is no let-up in demand from the Truckee full-time buyer who wants to get out.”
This phenomenon, in turn, ratchets up the prices of Sierra Valley properties, he said. A three-bedroom, two-bathroom home on one acre in Loyalton is going for an average of $350,000, said Hemig, similar to prices in Truckee a couple of years ago.
Truckee, where sales of over $1 million properties grew by 63 percent last year, is now attracting more of a resort and luxury market buyer.
“Tahoe Donner and other neighborhoods are evolving into the luxury market,” said Hemig.
Much of this can be attributed to a Baby Boomer generation that is looking ahead to retirement and willing to spend big to buy a piece of land outside of the city, said Trinkie Watson, the owner and broker at the Tahoe City office of Chase International.
In some cases Watson said she sees people that rent in the Bay Area, buying their only home here in Truckee in anticipation of retirement
But low interest rates, the demand for second or third homes in the mountains, and Truckee’s new home growth have all contributed to the local housing boom, she said.
“Anything new is very desirable,” said Watson. “We are going to see more and more of the over-a-million-dollar properties.”
Watson said she does not see much of a slow down in real estate escalation in 2005.
“It looks like it is going to be another strong year,” she said.