In fact, this seems to be the case throughout the state of California.   According to the CALIFORNIA ASSOCIATION OF REALTORS® “Lower home prices and interest rates led to an increase in home affordability in the third quarter of 2011.” The association went on to report that the percentage of California households that could afford to purchase a median-priced home of $292,120 rose to 52 percent in the third quarter, up from 51 percent in the second quarter.  The median home price reported by the South Tahoe Association of REALTORS® as of October 11, 2011 was $270,000 (based upon an average of the previous 12 months and below that of the state average.)

Folks fitting into the following criteria may want to look into taking advantage of today’s amazing home values.  A minimum annual income of $61,530 generally qualifies one for the purchase of a $292,120 statewide median-priced, existing single-family home. (Less for South Tahoe home buyers.)  The monthly payment based upon that estimated $292,120 priced home, including taxes and insurance, would be $1,540, assuming a 20 percent down payment and an effective composite interest rate of 4.63 percent.   C.A.R. went on to report that “Regionally, housing affordability rose in most counties in the San Francisco Bay Area but was down in Los Angeles County and Fresno County. At 77 percent, San Bernardino County was the most affordable, while San Mateo County was the least affordable, with only 25 percent of households able to purchase the county’s median-priced home.”  Historically, Lake Tahoe’s home values follow the Bay area by about 6 months to a year.  Don’t we wish we had a crystal ball about now?

image by Theresa Souers

On one hand we would tell you that the South Lake Tahoe real estate market must be improving.  After all, Don & I as well as our brokerage, Pinnacle Real Estate Group of Lake Tahoe, just experienced one of the busiest winters we have had in years.  According to the South Lake Tahoe Multiple Listing Services, the number of closed transactions for single family residences and condominiums totaled 574 during the past twelve months (April 1 through March 31.) This was a substantial improvement over the 510 reported for the same period in 2010 and crushed the 407 reported in 2009.  So yes, we would say that business has definitely seen a welcomed upward trend.

Furthermore, according to the So. Tahoe MLS, as of March 31st, 2011 the number of homes on the ACTIVE list totaled 336 with 72 of those reported in escrow.  In our ongoing hope/wish/desire to see a reduced inventory, this is another positive report as compared to the 378 active listings (with 96 in escrow) reported during the same period in 2010 and again, considerably better than the 418 active listings with only 46 in escrow reported in 2009.

On the OTHER hand, the values have been reduced to the lowest median home price level since before January, 2004.  As of March 31st, the Median Home Price (which is based on the average of the previous 12 months) was reported at $310,000.  During the late summer of 2010, the median home price had worked its way back up to $328,000 representing the first improvement we had seen in years.  However, the numbers began to turn back around in October.  Historically this is not unusual as home prices in the Lake Tahoe area generally are at their lowest during the later winter months.  Nevertheless, the ongoing input of short sales and REO’s within our inventory has continued to have a negative impact (certainly not in the eyes of buyers) on the overall home values.  For example, of the 336 ACTIVE listings available this past March 31st, 71 were under $250, 000 while 84 were posted over $500,000.  In 2010 there were 29 under $250,000 with 129 over $500,000 and in 2009 there were 18 and 200 respectively.

The most significant decrease is actually seen in the dollar per square foot values.  During the time periods we have been discussing above, the average dollar per square foot for this past year was approximately $212 as compared to $225 in 2010 and $268,000 in 2009.  In other words, while the buyers are content to spend approximately the same amount of money for a home, they are looking for the biggest bang for the buck.  All in all, with today’s record low interest rates, we don’t know what they are waiting for.  Wait – they’re not waiting.  Business is actually up.

Our featured price reduction is 3076  Jacarillo.  This home was originally purchased for $687,000.  The owners then completed a stunning kitchen remodel, added a workshop out back and fully landscaped the yards.  Located in Montgomery Estates and just a few homes down from beautiful forested trails, this beautiful family home is now asking only $519,000 with classy furniture being negotiable. Further information, visual tours, mapping and a photo gallery are all here to be enjoyed.  If you are in the neighborhood, stop by our Open House this Saturday, the 24th of July, from 12 – 3.

The next great value to be found is located at 1781 Skyline Drive in Country Club Estates.  This property is situated on two combined lots (approximately 30,00 SF of elbow room) with some of the most magnificent views to be found throughout the Tahoe Basin.  Street level living features a large living room with vaulted ceilings and skylights, a large dining area and kitchen with hardwood floors and a beautiful stone fireplace.  Downstairs are four bedrooms and a bath with a large jetted spa.  The owner has decided that now is the time to move on in her life and told us to price it to sell.  So we did.  All of this now for only $599,900.

Our final pick of the week for great price reductions is 2512 Cattleman’s Trail.  Check this out – brand new construction with all the “bells and whistles” is now only $499,000.  Where else in Lake Tahoe will you find top of the line construction, three bathrooms all with jetted tubs, hardwood floors, vaulted ceilings, granite counters all in one of the area’s most desirable neighborhoods?  Originally built to be the contractor’s own home, no corners were cut when it came to design or quality.  Families with small children will especially appreciate the close proximity to the Sierra House School, the fenced yard and steps to the Lake Christopher Meadow with adventures just waiting to be had.

Now, as far as the bear in the above photo – we thought you might get a kick seeing our backyard visitor.  Yogi has a preference to wait until Don is done working on the pond prior to jumping in for an afternoon splash.  Our biggest chuckle was when he and our cat came face to face the other day.  The bear freaked and flew up the closest tree and the cat literally flew across the yard, through the door and up the stairs not to be seen for the next hour.  I only wish I had had a video camera handy.

Nevada's Oldest Bar

Many of you have been hearing me rant for some time now in regards to the nightmare we are experiencing here in Lake Tahoe in regards to the lending/appraisal dilemma in which we keep finding ourselves in. And, we are not alone. When recently attending the California State Business Meeting in June, I heard the same sad stories across the board. It didn’t matter if it was a metropolitan area or a small country town. The number of folks missing out on the purchase or sale of a home due to a poor appraisal (usually from lack of local knowledge) is running rampant. Hopefully, relief or at least perhaps the pendulum is beginning to swing back from the extreme.

TOn June 30th, Fannie Mae took a step at improving the quality of residential appraisals, by including a requirement that lenders CANNOT use incompetent or inexperienced appraisers. This step was highly applauded by the Appraisal Institute. Fannie also provided further guidance on how comparable sales should be determined and at the same time, are requiring lenders to explain any adjustments made to a property’s appraised value.

Among the guidelines, Fannie will require appraisals to included interior photos. Sadly, a number of borrowers have intentionally vandalized their homes which lowers the value of other homes in foreclosure. They are also letting it be known that lenders are not required to use an AMC and that they are within their rights to speak with an appraiser. Furthermore, the appraiser must respond to a lenders’ request to talk. It should be noted however, that the current HVCC’s rule that loan production staff may not speak with the appraiser still holds true.

These new guidelines with the hope of correcting some of the “unintended consequences” of the Home Valuation Code of Conduct, will begin on all new loans started on or after September 1, 2010. We say hurrah and let’s start to get some of these loans funded and closed. According to Appraisal Institute Government Relations Committee Chair, Richard Maloy, “The buck now stops at the lender.” :Fannie is saying the lender is held responsible for the appraiser’s selection even if they were selected by an AMC.” Personally, I don’t feel that a lender should be held responsible but I will take any steps necessary to clean up this mess. Truly, just as Don and I would never think to represent a client in an area in which we are not fully knowledgeable, I have to believe most ethical and experienced appraisers feel the same way.

The good news was that there were 18 new PENDING sales, up from the previous week’s 14.  The lowest asking price among these new pending sales was $129,000 for a small, two bedroom, one bath cabin with 815 square feet of living space.  The highest priced new escrow was 2380 Dundee located in the Angora Highlands neighborhood.  This home was listed at $790,000.  Way to go Pinnacle!  The  overall median home price among the new pending sales was $314,000 yet with only 17 days on the market.

Now, here’s the really good news!!  There were more than double the amount of CLOSED escrows with twelve as compared to five during the previous week.  The lowest priced home among the closed sales was $155,000 for a small two bedroom, one bath cabin on Fairway within the Bijou neighborhood.  This home was quite the contrast to the $1,060,000 home sold at 1321 Wildwood found within the Heavenly Mountain neighborhood.  This home had four bedrooms, three baths and 3, 433 square feet of living space.  The overall median home price was $370,000 with approximately 90 days on the market.  With the average escrow period being around 45 days, this time on the market is relatively short.

To learn more about the Tahoe real estate market, be sure to visit our website.

1079 Modoc was built in 1974 with 1,200 SF of living space sold for $260,000.
1198 Tomahawk was built in 2009 with 2,130 SF of living space was a bank-owned sale at $410,000.
1139 Modoc was built in 2006 with 2,286 SF of living space was a short sale at $440,000
1194 Apache was built in 1981 with 1, 120 SF of living space sold for $287,000.
1998 Cherokee was built in 1971 with 1,228 SF of living space was a bank-owned sale at $210,000.
1964 Cherokee was built in 1961 with 1,088 SF of living was a bank-owned sale $172,100.
1596 Arapahoe was originally built in 1977 and included an unfinished upstairs addition. This property sold for $150,000.

Actually, when you consider that over half of the homes sold in Meyers during the first trimester of 2010 were bank-owned or short sales, the improvements in the above mentioned categories were a welcomed sight.

The median home price during the first trimester of 2010 was only $312,500 which pretty much in line with the $318,500 median home price found throughout the South Lake area. The median price of $318,500 was down from last year’s $395,000 posted at the end of April.

Following are the seven posted sales for Country Club Estates during the first trimester of 2010.

1887 Elks Club was built in 2005 with 2,678 SF of living space and was a short sale at $565,000.
1637 Sawmill was built in 1976 with 2,000 SF of living space and sold for $310,000.
1636 Thunderbird was built in 1972 with 1,288 SF of living space and was a short sale at $312,500.
1545 Tionontati was built in 1973 with 1,728 SF of living space and was a bank-owned sale at $206,000.
1451 Glen Eagles was built in 1981 with 2,068 SF of living space and sold for $450,000.
1209 Country Club was built in 2005 with only 598 SF of living space and was a bank-owned sale at $228,900.
1863 Crystal Air was built in 2009 with 1,700 SF of living space and was sold over asking at $485,000.

They’re baby steps but we’ll take every step we can.

This past week there were 14 homes that went into escrow, down 5 from the previous week’s 19.  The lowest priced new escrow is listed at $139,000 for 3610 Spruce, #6, a 2 bedroom, 1 bath with 896 square feet. The highest priced new escrow is listed at $799,000 for 2301 Cold Creek, a 4 bedroom, 3.5 bath with 3330 square feet in the Montgomery Estates neighborhood. The median pending asking price was $264,250 with an average time on the market of 103 days.

There were 5 CLOSED sales this past week, down 3 from the previous week’s 8. The lowest sale price was $309,000 for 930 Edgewood Circle, a 4 bedroom, 3.5 bath with 2400 square feet. The highest sale price was $650,000 for 1608 Plumas, a 5 bedroom, 3.5 bath with 3199 square feet. The median sale price was $495,000 with an average time on the market of 100 days. The good news is that this median home price is higher than the overall average.

This increase of median and average home prices scored better than the picture presented throughout the overall South Lake Tahoe area. The overall median home price (based upon the average from the preceding twelve months,) appears to have settled during the past six months. These statistics show a median home price of $318,500, down from last year’s $395,000 posted at the end of April.

Following are the ten posted sales for Montgomery Estates during the first trimester of 2010.
2303 Sutter built in 2003 with 2,971 SF sold for $564,500
2341 Cold Creek built in 1974 with 2,703 SF sold for $775,000
1802 Amador built in 1991 with 2,448 SF was a short sale at $400,000
1215 Gold Dust built in 1991 with 2,814 SF sold for $518,000
3100 Jacarillo built in 1982 with 1,400 SF and backing forest sold for $355,000
1157 Early Dawn built in 1973 with 1,120 SF sold for $298,000
1148 Golden Bear built in 1972 with 1,846 SF was a short sale at $350,000.
2384 Cold Creek built in 1977 with 1,832 SF was a bank-owned sale at $351,000.
1701 Pepperwood built in 1969 with 1,064 SF was a bank-owned sale at $214,800.
3025 Lodgepole built in 1996 with 2,578 SF and backing forest sold for $540,000

Let’s all keep our fingers crossed and hope this encouraging news is only the beginning of a stabilizing market. While we are at it, let’s keep those interest rates at record lows and keep those smiles first and foremost.

During this same week, there were 17 homes that went into ESCROW this past week.  Wow – especially when you note that last week reported only 7 new escrows. The lowest priced new escrow is $149,900 for 2579 Elwood, a 2 bedroom, 1.75 bath with 826 square feet located in the Sierra Tract neighborhood.  The highest priced new escrow is $875,000 for 1924 Cathedral, a 4 bedroom, 2.75 bath Tahoe Keys home with 3746 square feet.  The median pending asking price is $3285,000 with an average time on the market of 34 days.

Finally, the last week showed 14 CLOSED sales, up 10 from the previous week’s 4.  The lowest sale price was $150,000 for a 1353 Meadow Crest, a 5 bedroom, 2 bath Black Bart home with 2329 square feet (this home is going to be a rebuilding/ remodeling project).  The highest sale price was $800,000 for 2020 Aloha, a 3 bedroom, 2.5 bath Tahoe Keys with 2329 square feet.  The median sale price was $286,700 with an average time on the market of 94 days.

More information about these homes and neighborhoods can be found on our website or simply give us a call at 530.577.0389 for further information.