The State of Real Estate
Echoing a national trend, housing sales slumped in North Tahoe and Truckee last year ” with a few expensive exceptions.
The Tahoe City area was hit the hardest by the market slowdown, recording a 27 percent drop in home sales volume compared to 2006, according to a Chase International year-end report.
Around Truckee, homes sales sank by 6 percent, but the market was buoyed by a 6 percent increase in condo sales, a spike that Chase attributed to new Northstar-at-Tahoe condominiums hitting the market.
Tahoe City’s condo market fared dramatically worse, dropping a steep 44 percent in volume. Experts say a national mortgage crisis has exacerbated the housing slump.
“You have a whole collection of homes that were sold while there was a lot of credit,” said Senior Regional Economist Cynthia Kroll of the Fisher Center for Real Estate and Urban Economics at the Haas School of Business. “That credit is not available anymore.”
Despite sliding sales, housing prices remained remarkably steady in 2007.
Tahoe City’s median home price dropped just 2 percent, and the median condo price rose by $100,000 ” a 21 increase.
Truckee prices dropped lightly more ” by 4 percent for single-family homes and 7 percent for condos.
Last week, the National Association of Realtors reported its index of pending sales of existing homes in the country fell 2.6 percent in November from the previous month, although the trade group predicted sales would turn around in the second half of the year.
“It seems like there is a little more movement,” said Karen Degney, a broker and co-owner of Assist 2 Sell franchises in Truckee, Kings Beach and Incline Village. “I’ve been showing more [homes]. It’s a great time to be purchasing, because there is so much inventory and the prices are a little down [if not flat].”
Degney’s outlook runs counter to that of many economists, housing experts and others who expect the nation’s housing slump to drag on well into 2009.
“It is going to be a really slow adjustment,” Kroll said. “There are very few that are saying this will pick up in the spring. What happened in the credit market really pushed prices up.”
Degney’s agency recently sold a million-dollar-plus home, which she attributed to the more active market.
According to Chase’s year-end report, sales of higher-end homes continue to grow, while lower-end sales decline, at least in the Tahoe Basin.
Sales of homes costing more than $1 million on the California side were up 3 percent from last year, while sales of homes under $1 million slid by 19 percent. The trend was similar in Incline Village, where sales of homes worth more than $1 million soared by 27 percent.
“At the upper end, you have people with other sources of wealth that they are using to buy those homes,” Kroll said.
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