Since this is my first post of 2008, I want to address the most common question asked in a conversation about real estate here. Has the market come down? How far has the market dropped? Are prices getting better?
I am puzzled every time I am asked this question because it is the same question someone might ask about the price of gasoline. It turns out however, that with a little sifting and refining of the available MLS data since 2005 that there are a handful of “residential commodities” to look at. These are single family homes that sold in 2005 and again in 2007 without the benefit of remodeling between sales. They have not changed. Like a gallon of gas. Get it.
There are 14 homes that sold in 2005 and then again in 2007 that have not been changed, improved or remodeled and the group represents our area remarkably well. 8 homes in Truckee (4 in Tahoe Donner), 2 on the Westshore and 4 on the Northshore.
Here are the results:
103%: The average asking price of the 2007 sale as compared to the 2005 sale.
-0.26%: The average 2007 sales price as compared to the 2005 sales price.
Carefull interpretation makes clear the answer to the question about the condition of the Tahoe Truckee market. On average the market is down but only by the very slightest amount since 2005. I call that flat. And the homes that sold in 2007 were priced just above the their sales price of 2005 on average before they sold.
So act now, Buyers!. 2008 property at 2005 prices. Prices like this can’t last long!
2 Comments
January 7, 2008 at 7:56 pm
Good work on delivering that answer. The unknown quantity is whether those 2007 sales were early or late in the year, since my impression is the market was softer in the second half. More importantly, we don’t know if the market is going to continue to deteriorate in 2008, in which case it may be worth holding out a bit longer to try and get 2009 property at 2004 prices.
May 14, 2008 at 10:18 pm
[...] now for more than 2 years and prices on average haven’t moved much since 2005 , up or down. See my January 4, 2008 post. The opportunity is a clear Buyer’s market where negotiation really pays [...]