Is Truckee getting a dose of real estate reality?
A flip through one of Truckee’s latest real estate guides tells the story. Among the hundreds of homes up for sale, more than a handful are labeled with a “just reduced” or “new price” banner.
Just two months ago, it was difficult to find one real estate listing that had dropped in price.
Truckee’s real estate market, which has seen explosive growth over the last four to five years, is beginning to simmer down, local Realtors say.
“Things are definitely changing with our market,” said Carol Fromson, a Realtor with Prudential California who has sold property in the area for the last 17 years. “It is not the feeding frenzy it was.”
The reductions in asking prices are modest. And it is still difficult to find a home for less than $500,000 anywhere in Truckee. But in a town that has seen housing prices consistently rise by 25 to 30 percent over the last couple of years, a moderation of real estate values is big news.
“I don’t think the bubble is bursting, but it is leveling off right now,” Fromson said.
Truckee real estate trends are following state numbers that have cooled slightly as the summer comes to an end. In the latest data available from the California Association of Realtors, sales volume and median sale price both dropped slightly from June to July. And the length of time a property stayed on the market was longer in July, and longer than last year at this time.
These trends are definitely being felt by local Realtors.
“I think maybe there is a burst of the bubble, not exactly in prices, but in confidence,” said Sandy Casey, an owner and broker at Tahoe Resort Properties, who has been a broker in the area since 1977.
With a combination of new development, and locals looking to cash in on the hot market, home buyers have a lot more to choose from in the area, Casey said.
“We’ve seen some pretty big price reductions,” she said.
Casey added that people are “getting realistic” about what their homes are worth, and not basing their property’s value on the asking price of a neighboring home that may not be selling.
Don Schaller, a broker with Dickson Realty, said properties are staying on the market longer because of the quick escalation in real estate values over the last few years.
The increased housing prices have changed the people who can qualify for home loans, said Schaller.
“We are cutting people out of the market,” Schaller said.
“There are a lot of people that can buy a house for $350,000, but those houses are almost nonexistent,” he added.
In the 20 years Schaller has worked in real estate in the area, he said he’s seen the market fluctuate, but never seen prices drop dramatically.
But he has also never seen housing prices rise as sharply as they have in the last few years, he said. That inflation leaves the market “more exposed.”
If the economy turns sour, the second homes will be the first things that people give up, said Schaller.
“People say all good things must come to an end, but the question is when?” Schaller said.
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