South Lake Tahoe Real Estate Blog

I was invited to go to Nicaragua on a Medical/Dental Mission trip by a longtime Tahoe friend and I said “Yes”. Way back when, I was a dental assistant and they needed one on this trip. We had no dental instruments or supplies built up in reserve as this was a first mission of this type for my friend who generally does construction projects in Central American countries. I made a few phone calls and was amazed at the generosity of all my old dental contacts so we had more than enough to do the job.

We went to a very poor area in the north western part of Nicaragua called San Ramon and Bonete #7 (which is a word similar to borough) to serve the people, some of them had walked 6 hours to get there. I was told it would be hot, but it was HOT. The work was hard in hard in dirty, smelly places. We were able to provide basic medical services and the Tahoe dentist and I helped approximately two hundred people with pain relief (extractions) over four and a half days of clinics. It was a stretch for everyone and nerves were frayed at the end but I just had to think that I would be cool, comfy (with enough food to eat) at home soon but the Nicaraguans would still be right where we left them. I hope I don’t forget them and their conditions as I see how rich we are here. I am glad I had something to give to these people who gave me so much more than they know.

There is a new may of thinking about foreclosure for the American homeowner,  especially the homeowner who is not in financial distress and is able to pay the mortgage payment.  These homeowners are viewing their homes as bad investments and are choosing to walk away rather than pay for years on a property that may never be worth what they owe.  Take a look at this video from the Today Show where homeowners who are doing just that, and notice the shift from the “guilty feelings” that generally go along with such a decision.  http://today.msnbc.msn.com/id/26184891/vp/36661157#36661157

I am not advocating a position either way on a “Strategic Foreclosure”, but rather, just wanted to make note of this amazing paradigm shift and what it may mean in this economic crisis.

                                                                                                                                                                                                                                                                                                                                                                     Sold Stats for March 2010

•  37 Total Sold Listings in March                  
•  14 REO (37.8%% of total March sales)
•   7 Short Sales (18.9% of total March sales
•   Distressed Properties Comprising 37.8% of total homes sold in March

Active Listings Stats

• 306 Single Family Properties Currently Listed (Not in Escrow)
•   19   REO (.063% of total)
•   35  Short Sales (11.44% of total)
•  Distressed Properties Comprising 17.65% of Market Total

Pending Listing Stats (Homes in Escrow)

•  110 Currently in Escrow  
•    20 REO (18%)
•    53 Short Sales (48%)
•   REO & Short Sales Comprising 66.3% of the Total Homes in Escrow

Average Number of Days on Market (DOM) From Listing to Close of Escrow

•  96 DOM for REO Sales
• 204 DOM for Short Sales
• 232 DOM for Non Distressed Properties

These numbers still show that homes that are a better value are selling quickly, as any of you who have attempted to get an offer accepted on any of these well priced homes can attest. 

The Average sales price for March was $407,790 which is up slightly from February, whose average sales price was $401,652.  Does that mean the end is near, I think not with the number of notices of defaults and notices of sales still out there.  What it does means is that there is still plenty of opportunity for people who are in a position to purchase these homes.  With the threat of increasing interest rates, things could heat up in the buying arena.  Stay tuned for more updates.

Year to date in South Lake Tahoe there have been 42 single family homes that have closed escrow.  I continue to see the number of bank owned and short sale properties making up over 50% of the market.  Especially surprising numbers since that type of listing is just 19% of the properties that are for sale.

Sold Stats for 2010

• 42 Sold Listings in 2010                    
• 15 REOs
•   9 Short Sales
•   Comprising 57% of total homes sold

Active Listings Stats

• 307 Single Family Properties Currently Listed (Not in Escrow)
•   24   REOs
•   34  Short Sales
• Comprising 19% of Market Total

Pending Listing Stats (Homes in Escrow)

• 87 Listings Currently in Escrow
• 20 REOs
• 45 Short Sales
• Comprising nearly 75% of the Total Homes in Escrow

These numbers are amazing to me because they show that the distressed properties are selling and other listings are not.  I would caution any seller who attempts to navigate these turbulent times of home selling to price their home boldly, perhaps even a bit under the current market value to play the same game as the banks.  This strategy can create a “feeding frenzy” and savvy sellers could end up with multiple offers which can go over the listed price.  Otherwise you may be looking at a listing that can languish on the market without activity for months while the value continues to decline.  If you need to sell a property now,  price courageously and get the listing on as many websites as possible with an agent who has access to an extensive National Distribution Network on the Internet.

Radon is an odorless, colorless, radioactive case that arises from the decay of naturally occurring minerals in the soil. The gas is linked to 21,000 lung cancer deaths a year, second only to cigarette smoking, according to the EPA.  A report from the California Geological Survey in June 2009 estimated that 23,400 people in the Lake Tahoe area live in buildings where radon is likely to equal or exceed the U.S. Environmental Protection Agency’s recommended action level of 4 picocuries per liter.  The report was based on geological data, as well as results from a survey of 443 homes in South Lake Tahoe between 2006 and 2007.

According to the survey, about 40 percent of homes in the Lake Tahoe area are at or above the EPA’s recommended action level, while approximately 55 percent of homes in the El Dorado County portion of the basin who participated in the survey are at or above the recommended action level.

Winter is a good time to test a home for radon, Huber said.

“It’s the best time to test because your house is closed up,” she said.

I had a recent conversation with Ginger Huber who is in charge of Environmental Health in El Dorado County, and she wanted me to make sure and let you know that she is almost out of the “free” testing kits, but you can get them from the State of California for a nominal fee.  I found this article in a past issue of the Tahoe Daily Tribune and thought you might find the information on radon gas helpful.

As I scan the Internet for information on the current Real Estate Market – I am seeing more encouraging policy changes and proposals that encourage home buyers.  This bit of news was gleaned from the California Association of Realtors.

“The Dept. of Housing and Urban Development (HUD) announced Friday, January 15, that it is instituting a one-year moratorium on the Federal Housing Administration (FHA) 90-day anti-flipping rule.

With certain exceptions, such as HUD-owned and bank-owned properties, FHA currently prohibits insuring a mortgage on a home owned by the seller for less than 90 days. However, beginning Feb. 1, buyers may use FHA-insured financing to purchase properties resold through private developers and investors, providing access to a broader array of recently foreclosed properties.

Under the temporary waiver, all transactions must be arm’s-length, and most properties will require additional documentation of improvements and justification of the price increase. Additional documentation may include a second appraisal and a property inspection ordered by the lender.

C.A.R. recently submitted a letter to FHA Commissioner David Stevens detailing the challenges facing many home buyers using FHA loans, such as the lack of housing inventory available to FHA buyers, and the need for this rule to be revised to reflect current market conditions. The reexamination of the 90-day anti-flipping rule was passed as an action item during C.A.R.’s board of directors meetings in October.”

Thank You C.A.R.

                                                    It was about 18 months ago that we  began offering property management services.  We were amazed at the amount of  positive feedback that addition generated.  In these times we are frequently asked by home owners  how they can hang on the their Lake Tahoe properties. Long term rentals are a good way to generate income that will supplement  the cost of ownership.  While it will not completely cover these costs, it sure helps.   For me personally, I only look for investment properties in an area that has a quality property manager because it makes all the difference in the ownership experience.  One of our clients puts it this way, “It seems like a dream come true to have someone else deal with the property”.

Because of this demand for local knowledge coupled with the need for quality, competent service we have expanded the property management division to include commercial and industrial properties.

I have had the recent pleasure of helping several families purchase their first homes. There is nothing more rewarding in my job as seeing the excitement that accompanies moving into your first home. This is the silver lining in the real estate market. Market conditions and historically low interest rates have created a high affordability index which is over 55%. That means that over half of the Californian population can qualify to make the payments on a home. Combine that with the recent extension of the first time home-buyer credit from the feds and we have a great time to be a first time home buyer.

I am loving the fact that I can be part of the process that places these first time home buyers into homes where they can put down roots and raise their families. Especially when their children will grow up here in Tahoe with my grandchildren – watch out when they start to ski.

This afternoon I was on the steps of the El Dorado County Courthouse for a foreclosure sale of real estate.  I am always so amazed when I do this to see the little slice of Americana in motion.  The property I was interested in bidding on was postponed but it was still a successful visit.  While we were waiting for the auctioneer to arrive I sat next to the courtroom sketch artist who was touching up her rendering of the courtroom proceedings, I am sure I will see those same images on the news later tonight.  There was an elderly woman (I have to be careful here as that could be a reference made to myself) who was asking tons of questions since this was her first visit to an auction.  She asked me, “Do they really have the auction on the courthouse steps?”.  She was amazed to know that they certainly do.  It is a wonderful atmosphere of excitement and anticipation, almost carnival like.  I say it was a success, even though I didn’t get to bid on the property that I have been watching,   I was entertained by all the goings on and as I was leaving I went to the finest hardware store anywhere, Placerville Hardware, what a treat.

Cabin on Echo Summit

Did you ever ask yourself this question as you were driving up to Tahoe along the Highway 50 corridor?  There are an amazing number  little cabins beginning at about Whitehall.  Well . . . the answer is they are mostly recreation residences, or Forest Service Cabins.  There are almost 600 of them on on the El Dorado National Forest and that includes those in the Lake Tahoe Basin.  You can buy these cabins, not the land, just the cabins when the present owners wish to sell them.  It is sort of like buying a car or a boat because they are considered personal property in the form of improvements on land that is owned by the public, you and me.  You get to use the land with a 20 year special use permit (not a 99 year lease) issued by the Forest Service.  There is a yearly fee for the land use and, get this, you also pay real property taxes at about 1.1% of the purchase price to the county where the cabin is located.  They tell me taxes are charged because you receive county services for your cabin which is good, especially if you need a fire truck or a paramedic.  These are cash transactions and there may not be winter access or winter water, so are you wondering, “Why in the world would I want to pay cash for a cabin on land that I don’t own that does not have winter water or winter access and I can’t rent it our more than 14 days per year?”  Good question.  The answer to that one seems to be the lifystyle that comes with these wonderful places.  In my many years of representing sellers and buyers of these cabins I have been witness to the amazing transformation that comes over families who rest at ease as they see the new families who are buying the place where their family  memories  were born as they realize that more wonderful memories will continue to be created for the new owners.  Each cabin tells it’s own story and I can say that I’ve never  heard the same story twice.