With three-quarters of the year behind us, let’s take a look back at the sales and inventory statistics for the Incline Village Real Estate Market and see how things compare at the same time in 2006 vs. 2005. In a year when the media is talking doom & gloom, it’s important to remember that like politics, all real estate is local. So, while other parts of the country might be experiencing a price decline, that is not the case for property values in Incline Village.
The median price of $1,050,000 for single family houses is identical to 2005 at this point in time last year. The median price for condos has actually jumped by over $100,000 from $460,000 to $580,000. So, even though the actual number of units sold in 2006 vs. 2005 has dropped, the median prices reflect the true underlying value of real estate in Incline Village and Crystal Bay.
Sales of houses in units for the first 9 months of 2006 are down 45% (94 sold in 2006 vs. 169 in 2005) and sales of condos in units are down 58% (82 sold in 2006 vs. 192 in 2005).
The amount of inventory is up for both categories. We have 220 houses on the market as of Oct. 1, 2006 vs. 166 in 2005. For condos, the inventory now is 150 units, last year it was only 76. Inventory now is much closer to historical norms. The inventory in 2005 was so low, that whenever a well priced property came on the market it would likely sell in a relatively short period of time due to the laws of supply and demand and that one great intangible; the fear of missing out on a good deal.
To summarize the current market, inventory of houses and condos is up 35% vs. 2006, sales in units are down 52%, the median price of houses is the same as in 2005 and the median price for condos is up 21% over 2005. The weekly sales statistics for the Incline Village Real Estate market are updated every Monday at:Â http://www.InsideIncline.com
The statistics for the first nine months of 2006 point to a healthy real estate market that is in a plateau phase for houses, with upward pressure on condo prices, especially quality properties at low elevation. Investors see the intrinsic value of owning property in Incline Village. The long-term outlook for the overall supply / demand situation is very favorable, since there is virtually no raw land remaining for development.
There are a few pockets of softness in the condo market in those complexes where demand continues to outstrip supply. Contrary to the fears of some, my earlier predictions about the prices in McCloud have come true with only a tiny correction in the range of 6% vs. 2005. We have seen 4 condos in McCloud go into escrow in the past month, all in proximity to $570,000 – $600,000.
The Bitterbrush and Mountain Shadows complexes still exhibit some excess inventory and softening. But, I do not think anyone who bought 3 years ago in the high 200s to low 300s is complaining when prices now are nearly double what they paid. You cannot expect to earn 20%+ appreciation every year. So, after a quick, steady rise in the 2004 – 05 time frame, the market needs time to settle before prices start climbing again.
The only areas where I see softness for the single family homes in Incline Village are at opposite ends of the spectrum. High elevation, low price homes are not in demand (especially since a good percentage of these need a lot of work), and low elevation, high square footage homes are not selling. Not many people want to own 5000+ square feet as a secondary residence, so good values in that size range continue to sit on the market.
From a long term perspective, since there are only a few parcels of land left for development in Incline Village, the supply of housing stock is very limited. With the Baby Boomers retiring and demand for vacation homes at Lake Tahoe continuing to rise, long term trends appear favorable for the Incline Village Real Estate market. I anticipate the plateau phase for Incline Village real estate prices will continue through 2007 with the next uptick in the market beginning in the summer of 2008 or possibly later depending on economic and political events in the next 18 months.
Don Kanare is a Realtor in Incline Village, NV. A former business consultant from the Bay Area, he uses his entrepreneurial and problem solving skills to help his clients achieve their goals. Don received his Bachelor’s Degree from Boston University in 1977 and relocated to the west coast shortly thereafter. He is an avid fan of the Tahoe lifestyle and enjoys skiing, hiking and outdoor adventures. Don is the creator and webmaster of http://www.InsideIncline.com a web site focusing on real estate for Incline Village and Crystal Bay, NV on the North Shore of Lake Tahoe.
