r e n o . r e a l t y . b l o g

This evening I went to a real estate marketing mixer. The Title people told me that their lenders were telling them that they have tons of buyers qualified and ready to go, but that they (the buyers) were waiting to see what the market does.

Concurrently, I had a very busy first half of the year. But now? Calls and emails are down, yet blog and website stats are WAY up. What's going on? The buyers are lurking... waiting to see what the market does. Waiting for the sellers to crack.

I don't blame them. I'm telling my own mother-in-law, who is looking to retire in Reno, to be patient, see what the market does, and only offer on something significantly below market. Occasionally, these come up, and when they do, people pounce.

Today I spoke to some of the other agents in my office working with buyers. The verdict? Same story. Buyers are watching and waiting to see what happens. Like little vultures, they're waiting to see who keels over first, then they go in and scoop up the very best deals. Better to be scooped up sooner than later, I think.

Check this out... Reno finally ranked a real page on the US Bubble Wiki. Our little "B" market is officially on the map! See it

So, part of blogging involves checking your stats to discover who's finding you and how. Basically, this means backtracking links to see how the heck people end up on your site. Some people come to this this blog by doing a Yahoo Search on "Reno Real Estate" or via a link from Reno Discontents or by Googling "Diane Cohn" and "Husband" (Yeah, I thought that was a little creepy, too). But most people land here after doing some type of benign real estate search.

Tonight as I was checking things out, I backtracked a link from some site that ranks realty blogging sites. And apparently, on June 20, 2006, they tracked my teensy little site as having the biggest mindshare gain in one day, against some of the serious heavyweights in the real estate blogsphere.

I took first place to Zillow's second place! (Let's not forget that Zillow has millions in funding while I have nothing more than sheer enthusiasm for my craft, which translates into zilch, moneywise).

On that day, I was in the top 25% of influencers in the realty world blogsphere (I think, as I still can't quite figure out how this site operates... if anyone else gets it, please let me know). Anyway, given that Reno is considered widely as a "B" market (...sorry, we're not SF, NY or LA), I thought this was a pretty big deal. Really?

Pending status homes in the last 24 hours = 491 at an average $371K and a median $308K. Current number of single family homes offered for sale = 4817. Compare this to July's random pendings check at 432 for an average $386K and a median $310K with 4805 homes offered for sale. So in this moment, if these pendings close, we have a ten-month supply of homes in our market, down from eleven. It's good to see  a little improvement.

These figures were pulled from the Northern Nevada MLS and do not include builder direct sales, for sale by owners or other private transfers. These are single family homes including condos, stick built and manufactured homes pulled from Area 100, the Reno-Sparks metro area. Active listings include actives, new, back on market, price raised and priced reduced. Pending classifications include pending no show, active pending call, active pending loan and active pending house. Pendings were pulled looking at a 24 hour period of time to provide a market snapshot of recent activity.

Today I got some realtor spam from an industrious local homeowner. He relocated to Vegas and is motivated to sell his home in Stead, offering a $1000 bonus to find a buyer to close by September 10. Then there's this couple throwing in a free used car if you buy their home.

Sellers, forget the lame incentives. Here's how to sell your house in today's market, pronto...

This home originally listed for the dream-on price of $549,000 in August 2005. By January 2006 it was down to $524,900. Then they switched realtors and relisted it at the same price until April 2006. Then they dropped the price to $467,900. In August 2006, it expired. This time they got serious and listed it with agent number three for $398,900, which is basically a 2003 price. And, voila? In contract, six days later.

Folks, in this market, to sell quickly, you need to be the best deal out there. Not comparable, not at the low end of the comps, but BELOW comps, by a nice margin. That's how you get your home into contract in six days.

Time to tighten the belt as this year in real estate continues to worsen (according to the flameball of media coverage that sure smells a lot like 2001 when the dot-bomb hit). I guess the kids will have to go back to eating Top Ramen for dinner...

Pinched homeowners turn to short sales. more

East Bay foreclosures on the rise. more

Housing ponders a hard landing. more

Even Lereah says hard landing. more

Lereah mea culpa? more

Real estate about to get worse. more

And for you investors out there...

Upcoming real estate auctions. more

Earning mega-bucks through short sales. pdf

Somehow chocolate is no longer enough... I think I need a drink!   ;)

A few weeks ago I received an email about an auction of fractional ownership condos on the Gulf Coast of Florida. These units are to be sold in two days regardless of price by leading real estate auctioneer, Sheldon Good. Alleged market value? $229K. Suggested opening bid? $65K. more

While on vacation a couple of weeks ago in Jackson Hole, WY, I learned of a another absolute auction of fractional condos at the Teton Club. Again conducted by Sheldon Good, these condos will be sold regardless of price on September 10. Previously priced from $72K-$192K, opening bids start at $15K. more

Meanwhile, Intrawest is peddling whole ownership units at a Westin branded luxury development in downtown Napa, but will they succeed so wildly as they did with Squaw Valley, Mammoth and others? They certainly don't seem to have waiting lists this time, as I regularly receive updates encouraging me to bring my clients to the project. more

Last year, a property sold in South Reno at an auction conducted by JJ Manning. Originally listed on April 13, 2004 for $2.9 million due to a corporate relocation, the home didn't sell. 91 days later they switched agents and repriced at $2.7 million. At some point I understand that either the employer or relocation company took possession of the house, which probably led to the decision to get it off the books via the auction. 458 additional days and several price reductions later, the home was auctioned for $1,622,500, closing escrow on October 21, 2005. more

Now these owners in Sparks are doing themselves on Craigslist. more

That short sale in my neighborhood? Who knows... maybe it will end up at auction, too. see

Ebay has done a marvelous job creating comfort with the idea of online auctions. But in the world of real estate, so far only land and timeshares have had much in the way of success on that site. But as companies like Redfin make buying a home online easier, and as the market copes with more distress sales, online auctions become a compelling option for those who simply must get out. And for those seeking true bargains.

I think online auction companies specializing in real estate are poised for serious growth.

Well, I think it's time to throw a little more fuel on the fire, just for fun. My good buddy Reno Ignoramus is a voracious reader and kindly provided the following links:

Nasty recession coming soon. read

The psychology of the housing spike. read

Is it really a lending bubble? read

Sacramento flipper losses. read

Investment psyche roller coaster. see

Homebuilder mood is grim. read

Home sales slump lower than forecast. read

This could drag the entire economy. read

I think I need some chocolate. yes

From Jan 1, 2005 to July 31, 2005, 71 condos sold around downtown, from a low of $72,000 to a high of $500,000 with a median sale price of $255,000 and an average of $263,124. From Jan 1, 2006 to July 31, 2006, 46 condos sold from a low of $132,000 to a high of $720,000. Interestingly enough, the median stayed constant at $255,000, while the average sale was $277,635.

These are resales only and do not include non-MLS Riverwalk closings. While resale closing volume appears to be seriously down, I bet that if you included Riverwalk activity, overall closings would be up. What's fascinating is that the median stayed totally level... I guess $255K is the magic price point for condos downtown?

Which makes me wonder about the Montage, the Palladio and all the other high end condo projects going in. Construction is expensive. It goes up every day. These developers have to charge a lot to make their projects worthwhile. But can locals really afford to buy? In many cases, no.

So the developers look to out-of-town second home buyers... from LA, the Bay Area, wherever. And while the downtown condo concept in Reno is relatively new, we're still competing with other metros--San Diego, Chicago, Orlando, Portland, Sacramento, Las Vegas and everywhere else they build high rise condos, which seems to be everywhere these days.

Part of me wants to disregard what's happening in the other metros because our proximity to Tahoe makes this region so special. Real estate markets are always local. But the other part of me must acknowledge that these major metros suddenly can't seem to sell through their condo inventory. We in the realtorindustry count on all these soon-to-be-retiring baby boomers to show up to the party to purchase second homes and retirement condos with their big fat inheritances... but I wonder. Are they really coming?

Data from the Northern Nevada MLS. Search included Areas 120 and 160.

This week's sales meeting took place at the "Resort at Tanamera." I used to think this was just an overly pretentious name chosen to make these former apartments sound like a great condo buy. But truly, this place is lush, and the prices aren't that bad for what you get.

We sat out on the terrace, they fed us breakfast, and for a while I felt like I was on vacation in Hawaii (minus the palm trees, of course). Maybe it's more like Portland, with sunshine. It seriously did not feel like Reno at all.

And BTW, everyone pretty much panned the David Morris market downturn estimate. (I guess his total worked out to 30% over three years?) Since no one can really predict the market, they didn't feel it held much credibility. All I know is that I've been getting serious discounts for just about every buyer I've represented lately, and I see asking prices coming down on a regular basis. So 10% off since last summer? Yeah, that's plausible. And another 10% in the coming year? Well, given all the builder inventory and resale inventory and the dearth of buyers clamoring to buy homes, well, I think that's plausible too. But another 10% in the following year? Who really knows? Maybe yes, maybe no... it all depends on economic factors here and abroad.

But I digress. My broker went over weekly market activity, which varied only slightly from last week. In a nutshell, South Reno home closings ticked up 30%, fewer homes came on the market in all areas except Sparks, North Valley closings nearly doubled, and price changes (reductions) increased in South Reno and Sparks.

Then the Tanamera tour. Totally luxe common areas include a resort style pool with multiple waterfalls, a koi pond, a gorgeous garden picnic area, a residents lounge with full kitchen, a cigar room, a home theater, an onsite concierge, another formal living room, a game room coming and a business center with a marble paneled conference room and several offices for use by residents just as soon as the sales office is no longer needed.  And then there's the health club... tons of weight machines, a pilates area, two racquetball courts and very deluxe changing facilities. All this for prices starting in the mid-twos.

The resident demographic is diverse... first time buyers, retirees, divorcees, young professionals, second home owners. Allegedly, everyone who lives here loves it. And get this. If you're a qualified buyer working with a Realtor, they'll serve you and your real estate professional a private, gourmet lunch on the terrace to try and reel you in. (So, if anyone wants to join me on the terrace for free lunch, please call. Think of all the money we'll save! But you will need to bring a pre-qualification letter, okay?)

They have 440 units total with 42 in contract and 150 already closed. First time buyers can receive a $5000 incentive, teachers, nurses, fire fighters, policemen, military folks, and other public service professionals can get $8500 in incentives, and everyone who buys gets their HOA dues paid for two years ($225/month). Most units are owner-occupied, so there is room for investors. One bedrooms rent for $1150/month, two bedrooms for $1450-$1550, and three bedrooms rent for $1850 a month. When they ran these as apartments they claim their vacancy rate was a mere 1%. You can also run these as fully furnished corporate rentals (at almost double the rent, though higher maintenance and higher vacancy, they are potentially very lucrative due to the number of employers nearby... and that Residence Inn is almost always full) but the minimum stay is 60 days.

And best of all, if I sell two Tanamera condos, I get a 42" plasma TV. Cool, huh? I can't tell you how badly I need another TV in my house. So, if you're thinking of buying one of these. Call me. We'll do lunch...  ;)