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This Months Articles: 86 McCloud - 2BR, 2BA, 1111 sq. ft. - Tastefully Furnished Upper Unit 1 Block from Beach - $379,000 -Lowest Price 2BR on the Village Blvd side of the complex 916 Harold Drive - #48 Cedar Crest - Beautifully remodeled 3BR, 2BA cabin with 2 car garage. 1,536 sq. ft.. - $429,000 Real estate sales may be signaling uptrend “Historically and to put it simply, real estate markets have moved through one of four phases (and I've inserted years for where I think the Jackson Hole market has stood over the last decade): Phase 1 (2001 to 2005) :: Unit Sales + (increasing), Prices + If the above holds true, someone would ideally want to purchase real estate when the market was moving from Phase 4 (where more properties are selling, but prices are still slipping) to Phase 1 (where inventory has thinned and unit sales are still increasing, but demand is also pushing individual property values up). Based on the not-quite-end-of-the-year stats for 2011, it appears that (a) inventory continues to thin in areas where real estate is priced accurately and (b) there's some anecdotal evidence to suggest individual property values are threatening to tick upward. That said, individual property values are difficult to track in the Jackson Hole market. For example, it's tough to draw a correlation between condos in the town of Jackson (where some prices have dropped nearly 70% from 2007 highs) and a ski-in/ski-out Four Seasons Resort unit. It's also unclear when looking at the overall dollar volume if one $5MM home sold, or if the volume reflects ten $500,000 condo sales. And this disparity between property types is inherently what makes tracking stats in Jackson Hole tricky; unless you're focusing on a microcosm that's incredibly similar — like Melody Ranch, or specific projects in Teton Village or the town of Jackson – you're left to take those results and extrapolate them to the larger market. That said, things appear to be trending from Phase 4 back into Phase 1. For example, at this time last year, sold homes in East Jackson were down 23% (based on price-per-sq.ft.) from 2009. This same stat for December, 2011 has tapered to a 3.7% decrease. Another bellwether is the Four Seasons Resort in Teton Village. Last year, 6 units sold for an average $/sq.ft. of $1021. This year, 5 units sold (with another under contract) for an average $/sq.ft. of $1031 (or a 1% increase). Better yet, in December 2010, there were 8 units for sale in the flagship resort. This year, current inventory for sale has fallen to only 4 units (or about 8 months of inventory). I'd also be remiss to not bring up the lingering dysfunction of the Jackson Hole market. There's still a number of properties for sale that cling to their 2007 pricing in the hopes someone will pay top dollar (and despite market data to the contrary). In reality, these poorly priced properties essentially make the available inventory more scarce given the likelihood of them selling is incredibly slim. There's also pockets of the market — like vacant commercial building sites and the uber upper-end homes — where there's so few bona fide buyers that it's difficult to draw any accurate trend.” I believe there are some parallels between the Incline Village real estate market and Jackson Hole that both buyers and sellers will want to take into account in the coming year. Our local market still has a significant percentage of properties that are priced at 2007 levels where sellers have not yet come to grips with the new pricing reality. We also have a lot of unique properties that do not appeal to the average vacation home buyer who may be seeking a small to moderate sized place that requires very little maintenance, thus skewing the inventory a bit on the high side. House and condo inventory levels have trended downward during the past two years, which is generally a precursor to prices stabilizing before they start to move up. Buyers looking to make a long-term investment will want to keep a close eye on the market and be ready to pull the trigger when the right property comes along. No one can be totally certain when the cycle will shift from Phase 4 to Phase 1, but there are signs we are headed in that direction in the next 12 months or so. 96 Third Creek - Great location on the gated side of the complex. End unit, 3BR, 3BA, 1,787 sq. ft., 1 car attached garage. Private setting buffered by trees, fence and open space. $679,000 Inventory drops to lowest level since 2006 This is the time of year when the number of properties for sale is generally at or near its lowest level. A significant number of listings expire annually at the end of December and many sellers take their properties off the market for the winter months when sales activity is relatively slow. The chart below shows the number of residential properties for sale during the first week of January each of the past five years. Year # of Properties for Sale 2012 311 2011 349 2010 341 2009 421 2008 360 2007 357 Part of the reason that we have seen the inventory drop to its lowest level in several years is the increased rate of sales during 2010 and 2011. While we have only crept back to the mid 200s in terms of closed escrows, this is much better than 2009 and 2008 when less than 190 properties changed hands in Incline Village and Crystal Bay each year. Unfortunately, we are not going to see a return to the boom times of 500 to 600 residential transactions per year anytime soon unless there is some type of extraordinarily positive economic event. The decrease in the number of residential properties for sale parallels the decline in the local rental inventory. Many property owners entered into long-term leases with tenants when real estate prices started to soften a few years ago. Some absentee owners have enjoyed earning additional income instead of trying to compete with other sellers in an overcrowded real estate market. The cumulative effect of renting your property for two or more years can provide tens of thousands of dollars of additional income. So, while some rental properties fall into the category of “shadow inventory”, these properties will come back on the market one at a time when each owner feels it is prudent to do so. (This is in contrast to the foreclosure properties held in the “shadow inventory” by banks and other financial institutions,of which there are relatively few in Incline Village and Crystal Bay). In the past few months we have seen residential rents start to stabilize and in some cases tick upward slightly for the most desirable properties. Even with the mild winter weather and lack of ski industry workers crowding into the rental market, desirable properties are now commanding rents that are 10% and in some cases 20% higher than one year ago. Cap rates on residential investment properties are finally becoming far more attractive than in years past. While the inventory of houses, condos and freestanding condos has declined significantly since 2009, there are a finite number of quality properties in good locations. Buyers have been extremely selective during the past four years and I do not see that trend changing in 2012. The vast majority of Incline Village and Crystal Bay real estate purchases are discretionary so buyers can afford to be patient until such time as the annual average inventory drops below 12 months. With 311 properties for sale as of early January and another 100 to 160 properties likely to come on the market later this year, it appears the supply of inventory will continue to fluctuate between 18 and 24 months in the foreseeable future. Click Here to See All of My Listings and Virtual Tours Click Here to See the Lastest Incline Village Real Estate Weekly Sales Statistics INCLINE VILLAGE REAL ESTATE YEAR TO DATE SALES Houses Condos Free Standing Condos Total 2011 Total Sales 96 106 27 229 818 Jennifer St. - Lakeview home with 3BR, 2BA, 2 Car Attached Garage, 1,424 sq. ft. $649,000 460 Teresa - Lovely lakeview home in Crystal Bay. 4BR, 2.5 BA, 1,992 sq. ft., level entry to kitchen, living, dining, master suite, powder room and 2 decks. All 3 guest bedrooms downstairs for maximum privacy. $499,000 - Reduced 100K - Motivated Seller!! Hikers and Mountain Bikers revel in winter sunshine The view from the top of Tamarack Peak has been quite spectacular and the South facing aspect means you don't have to tromp through snow to get there, Virtually all trails below 8500 feet are just about completely free of snow and in very good condition (except on the West shore where there is much less direct Sun in the wintertime). If you have ever wanted to hike the Tahoe Rim Trail from the Mt. Rose Summit Parking Lot to Brockway Summit in Kings Beach, the trail is in great shape right now. As an avid skier I recommend that you keep your skis in the closet for the time being and enjoy other outdoor activities at Lake Tahoe until we get several feet of new snow. I did go skiing during the first week of January at Mount Rose. While they have done a good job with making snow and grooming 2 intermediate runs along with a couple of beginner runs, there is very little terrain available. And if you are unfortunate enough to fall and slide off the run you will likely hit rocks and trees, there is nothing to stop you. We all got to enjoy an extraordinary winter last year with phenomenal skiing until July. I went out on June 29 last year and skied a foot of fresh powder in The Chutes at Mt. Rose, so for the time being we can enjoy the memories until Mother Nature provides large quantities of the fluffy white stuff. Click Here to See All of My Listings and Virtual Tours 2011 Newsletters January February April May June July August September 2010 Newsletters April June September October November 2009 Newsletters February April May July October December 2008 Newsletters May June July August September October December Copyright 2008 - 2011 - Don Kanare - All rights reserved. Inside Incline is entirely written and published each month by Don Kanare of RE/MAX Premier Properties for property owners and others who have an interest in Incline Village and Crystal Bay. If you have any questions or comments, please contact me at 775-828-3380 or send an e-mail to: Don@InsideIncline.com |
| For Incline Village Real Estate Information or a Free Comparative Market Analysis of Your Property Contact Don Kanare Your Incline Village Real Estate Agent RE/MAX Premier Properties - 5250 Neil Road, Suite 100 - Reno, NV 89502 - (775) 828-3380 |