I don’t know what could be so wrong with this house that they priced it at $117.23 per square foot, but to me it looks like the deal of the day. In a great area of Southwest Reno with lots of space, mature gardens, plenty of decking and clean-looking, mid-century modern architectural lines, at $460K for 3924 square feet it seems like a steal. Call me to write this one up, and if you can’t get me on the phone then call Guy. This one can’t last!
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Diane Cohn
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Caughlin Ranch House
Reno, NV
Mayberry Stables
Reno, NV
The Rock House
Reno, NV
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“I don’t know what could be so wrong with this house that they priced it at $117.23 per square foot, but to me it looks like the deal of the day.”
There may be absolutely nothing wrong with the house. It could be that they’re just realistic, motivated sellers. These types of people will be the ones who set the prices on the way down. The clowns who are still trying to get three sometimes four hundred per square foot will be lost in the abyss. Also, this is a fairly large house. The larger the house, the less expensive per square foot. And, $460k is still A LOT of money!
Let’s take a step back a few years. In 1999, one particular house on the desirable Newlands Cir. (I will keep the address private) sold for $565K. It is 3780 square feet on .64 of an acre. And, it also included a guest house. So, two residences really. The price per square foot was ~$149. This does NOT include the second residence. If including both, it would be somewhere in the neighborhood of $110 per square foot. This is for one of the nicest properties in an exclusive area.
Since 1999, wage growth in the Reno area has been paltry at best. At the same time, housing prices skyrocketed, not representing what wage earners could truly afford, but rather the amount of DEBT which speculators and unwitting families and individuals would agree to take on. The advent of exotic (toxic) financing and little to no lending standards allowed anyone into any home they desired. This opened the floodgates and demand for homes soared, along with prices. This created a speculative bubble which is not sustainable over the long term. By the time the dust settles, people will be delighted to garner $117 per square foot for their home. After all, that’s somewhere near where they should be.
Why does there have to be something wrong with the house to be properly priced? Everyone always comments about sellers who price their homes too high and then lower their sales price too slowly, causing their house to stay on the market.
Looks like this homeowner is simply pricing his house at a price which gives him a chance to sell it based on the financial realities (as opposed to the realtor created perception) of the current market.
BanteringBear is pretty much right on with his suggestion that this house is appropriately priced if we take out the frenzied Voodoo money driven speculative ponzi scheme otherwise known as the real estate market bewteen 2001-2005. Take away the nothing down, I/O, neg am Voodoo loans over the past 3-4 years, and can anybody serioulsy suggest prices would have risen to current levels??
One thing is for sure. Even if this house sells for very close to asking, comps in the neighborhood are going to take a big, big hit.
If one of my neighbors priced their house at appx. $100 per square feet less than what houses have been selling for, I would do some voodoo to them - think of what thats going to do to the comps…
One of the reasons that this home is so inexpensive may have to do with the fact that the house fills nearly every square inch of the lot that it sits upon. The view from every window is likely a close up view of a neighbor’s house. Plus, although it is ‘clean’, most people wouldn’t want to leave it in its current condition so factor in some $$ for updating as well.
Lots of interesting public record information available on this house. Firstly, the seller is a fairly prominent Real Estate Agent who decamped to a far tonier abode 1/28/05. The 3974 SF includes a 1760 SF finished basement. Using the standardly accepted practice of excluding basements from the square footage, the 2164 SF house is listed at $212/SF instead of $117/SF. Interesting that the owner updated the Zillow profile of the house, but left the 2164 SF number alone. The only permit work tracked by the County was a new roof 12/2000. Where is the staging we hear is so critical to making a sale, that the agents “guarantee” will add at least 3X the cost to the sale price?
Some neighboring “comp” listings:
395 Chevy Chase
Owner Oppupied
$529,000
1720 SF = $307/sf
860 Tamarak
Non-owner Occupied
$406,000
1443 SF = $281/SF
w/ 1183 SF basement = $155/SF
800 Tamarak
Non-owner Occupied
$400,000
1512 SF = $264/SF
w/ 520 SF basement = $196/SF
Any way you slice it, the Owner/Agent (who should know best) has listed the house significantly below the neighbors on a SF basis. I haven’t seen any of these properties, so I can’t say that 2325 Homestead is a “bargain”, but it does seem to be the best “value” in the ‘hood. It will be interesting to see how quickly it moves and how it will affect the area asking prices.
I’m sure the subprime situation is impacting the Reno housing market but I’m not sure to what degree. It would seem to me that the market in general is over-priced after its sustained run. Hence, I would expect the market to continue to move lower until some surge in new demand takes place. I’m not sure what could cause a new surge in housing demand. The big unknowns concern the possibility of higher interest rates for 30 year mortgages, a national recession or a major slow-down in the gaming sector.
While Reno appears to be a nice place to live, it is expensive for someone from the Mid-West or South.
So a real estate pro lists their own home at at least 20% under neighborhood comps.
So a real estate pro “adjusts” the square footage to include the basement, in spite of industry standards.
So the real estate pro fails to disclose owner/agent relationship.
So the real estate pro buys a upgrade house in Caughlin Ranch just a few months short of our maximum median price.
What does this all point to? The professionals have finally figured out that the market is up sh*t’s creek, and are willing to bail. And that they are fully prepared to do everything possible to get the sale done ASAP and accept a reasonable profit (or loss). And they may not have been the “experts” in the micro-markets that they claimed they were.
GreenNV - how about sharing with us novices the online tools you use to track all this information down? I can’t even locate this property in the MLS listings!
We looked at this house on tuesday with Guy. The house does need some TLC but overall is in good shape for the year it was built. When we were leaving we noticed a leak in one of the gutters and water(from the melting snow) was pouring directly into the basement. Also one of the bedrooms and bathrooms is down in the basement so i would consider this a 2 bedroom/ 2 bath 2150sq/ft house. That would be a dark and cold place to live down in the basement. This house doesnt have AC either. The landscaping is overgrown but would look very nice if properly trimmed and cleaned up. Also the garage has a wall running down the middle of it which was weird. Overall the house is not overpriced right now and if it were 350-400k i would jump on it. Thanks again Guy for showing us the house.
Wazoo,
http://www.dicksonrealty.com/ In this case, I searched for a price between $460 and $460 to get the address. I like the Dickson site for the feature to “Map Nearby Listings” which how I got the comps.
http://www.prunevada.com/homepage.aspx is really helpful in that you can search listings by zip code, and sort by listing date and see what is new and DOM figures.
http://www.co.washoe.nv.us/assessor/ is the most usefully site you will ever find. Under “Assessment Data”, click on Real Property, click through the disclainmer, and you will come to the search page - by address or parcel number. You can learn sales history, taxes and delinquencies, square footage and rated quality of construction, owner’s mailing address (which is how I found the owner’s new home - also useful for identifying flippers), permit history. Sometimes you can even get an online photo. The View Map tab will get you aerial maps that are WAY better than Zillow, although Zillow’s Birds Eye View shots are pretty amazing.
http://maps.cityofreno.net/ Reno’s mapping application is much better and more current than the County’s. The easiest way to enter it from this page it to click on “My Neighborhood”, enter the address, and go from there. There is a pull down menu for Map Types - each map allows you to get differenet info - crime statistics, zoning (watch out on this one if you are County and not City), on Property Map you can show the contours. It takes some time to learn the ins and outs of the software, but it is a HUGE source of information.
Finding out that it was an owner/agent was a fluke - I just recognized the owner’s name when I looked at the MLS listing showing the listing agent.
Once you know your way around these sites, you should be able to build a pretty detailed overview on a property in well under 5 minutes. Happy hunting!
Mike
GreenNV does a great job of showing how the internet is so radically changing the re business. Only as recently as a couple of years ago, much of this info was not very easily found. People had to rely on realtors, who, of course, always told the truth.
Still, there is some other info that is only accessible through the closed MLS. The NAR is fighting hard to keep it closed. But the advance of internet information is going to outstrip the NAR’s litigation efforts. In the not too distant future the realtors’ monopoly on info will be broken, and then only realtors like Diane will survive.
GreenNV absolutely typifies today’s smart shopper. I can’t tell you how many times I’ve taken a client out to see a house… and they’ve already pulled up the tax record, checked out the Zillow values, googled the owner and in some cases even talked to the neighbors. Seriously, it’s not uncommon for a client to know more about a particular property of interest than I do!
So be it. That’s the beauty of the internet. My job now shifts from gathering and disseminating information to a more consultative role, helping the client sort through everything they’ve come up with to reveal the true opportunity. Now I can focus on strategy, which is the fun part, anyway.
The industry is definitely changing, and I watch with interest.
I looked at this home and it was not “deal” at all. The home is really out of date with no bathroom attached to the master and that bathroom has no shower with a single sink. The best bathroom is placed in the middle of the kitchen area. The real sq ft is 2164 for a cost of over $212.00 per ft. The basement is trashed and would have to be remodeled. We offered to buy it at the ask if they would remodeled it and they said no it was a real deal.