(LAKE TAHOE REAL ESTATE BLOG) The article below this one addresses recent comments from a few of our readers that reveals current market reality in South Lake Tahoe is not what some buyers expect it might be (here).
There is a disconnect between current South Lake Tahoe market reality and buyers expectations.
These sentiments are based on a disconnect between current market conditions, which is based on the median sold price and expectations of some buyers that home prices will drop significantly more. These expectations are based on recent national real estate news pieces containing predictions of a further drop of 20% in the national median sold price.
As a lead-in to this article, please find here why national real estate predictions often have little effect on South Lake Tahoe market conditions (it has to do with the difference between the national market at large and the specifics of a second-home resort market).
At present the median sold price in South Lake Tahoe has dropped 15% since 2006 (from $460,000 to $390,000.)
Nevertheless we believe this disconnect is real; it’s valid, and to address it, and hopefully answer it as best as possible, we’re wondering if some of the decline as predicted in the national real estate news could already be factored in our market.
In other words is more decline here, now, hiding in plain sight?
The New Study: Can you get more house for the money now that before?
In the last few days, we’ve been crunching data back to 2003 to best understand what kind of house one can get for their money in South Lake Tahoe these days, compared to what it was from 2003 to today.
Articles on this study will start soon. We expect there will be four of them, each detailing specific price ranges.
The idea behind this new study is to see if we can find changes in home values outside of what the median sold price indicates. We’re going to look at key factors of size and square foot value. We’ll also look at condition and age, though these factors are more subjective.
If one can get more house for the money now, and we think the study will thus reveal, then it is possible that herein the “decline” some folks are looking for in order to make a buying decision has already appeared.
Could this be the answer to our disconnect?
Maybe this decline, or the amount of it, that one might expect from the current real estate climate is found in what is available, and the current price of it, rather than what has sold in the last 6 months.
For example, and this is more of a question for our study, if one pays $450,000 for a house in, lets say 2005, at the very top of the market, what is the size and square foot value of that home compared to a house sold in 2008 at the same price?
Though the “sold price” is identical in this example, do you get more these days than before, and if so, how much, and is it quantifiable?
In other words, what if one can get 20% more house? Adding that to the 15% decline we have seen already, would this better address buyers expectations?
This, along with the foreclosure information, and our monthly median-sold price reports, we think will give both potential Sellers and Buyers even greater depth and understanding of home values in South Lake Tahoe, CA.
For Sellers, the goal is to get your house sold, and for as much as possible... within your time frame. Right pricing, which comes from acceptance of thorough market analysis is fundamental to that.
For Buyers, the goal is to provide the basis for an understanding of both opportunity and advantage in the current market to buy as smart and as cost effective as possible. It’s also our goal to make sure you don’t miss out on buying at the best possible time... because of trying to find, and missing the bottom of a market that may be very close to, if not already there.
If our hunch is correct, the study we’re doing now could very well answer key questions for us to help you, well... look in all of the right places for the best information possible to use as a guide.
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We provide this information as a public service. Pleae email us with any questions or insights.
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