What a grubby, nasty day it has been. Moving furniture getting ready for a sale (search CL Furniture for 215RBD later in the weekend – good stuff cheap!). Recovering from a week of construction (yes, Bill and Pete) getting ready for a new tenant. Trying to get a break in the rain so I could paint the new exterior door "Cocktail Olive". I need comic relief, so here are a few nuggets from the week in real estate:
4241 Dant hit the market for $779,000. It was purchased in December 2004 by our departing UNV basketball coach, Mark Fox, for $710,000. He did pretty well with his first house on Sage Rock, going from a purchase price of $288K in June 2001 when he arrived, to $490K when he sold to buy Dant. I wonder if he has a relocation clause in his contract with Georgia? And yes, it is down the block from Allen’s.
425 Leventina finally listed at $435,000, totally destroying my comp. It was purchase in May 2006 for $610K after being listed for a long time at $680K, then refinanced for $710K and "remodelled". Except the remodel never finished, part of the roof blew off, and the owners stopped paying in December 2007 and were mortgage free for over a year. Actually, this is a pretty good deal at this price.
Anyone catch the Reno television personality who received a NOD this week?
200 Talus Point is the student dorm condo project. Unit 532 listed this week for $115,000. It was originally purchased in August 2006 for $225K, flipped in January 2006 for $274K, before going TD in February.
2115 Brooksboro listed (or extended) as an REO at $489,900. I believe this was Guy’s "Lakeridge Modern" listing at $795K or so a few months back. This one was $635K in September 2000, and $825,000 in April 2007. Serious errors in timing the market on this one!
194 Tramway in IV received a $1,000,000 NOD on April Fools day. There is also a $150,000 HELOC in place. It was a rustic $90,000 cabin in 1978 when it was originally purchased, and morphed into a $1,299,000 listing over 30 years. If you are into public records searches, this one will will keep you busy with 41 recorded filings.
836 Center Street listed at $350,000. 8 on Center is the project everyone loves to hate, or hates to love. 836 was a unit owned by the developer, and lost to a TD. My recollection that these originally listed for $495-525K and Guy briefly had the listing on the way down. Time to buy and be an urban pioneer?
Is the "Party Shower" the new must have amenity for the Reno elite? Especially if it is adjacent to the "Wine Tasting Room"? It is really a well done virtual tour. Respect the owner, please, and confine your comments to this property.
I feel better now.
Corina
It seems we are now seeing more and more higher priced properties going NOD. Starting to see $700 and $800K loans go into foreclosure. Could this be the first arrivals of the Alt-A and option ARM defaults?
Raymond
I like Coach Fox and I think he did a good job here. I wish him well at Georgia. But unless he did some major improvements after he took ownership, I think his house is overpriced. Can anybody refer me to a house in Reno that today is worth what it was worth in December of 04?
Norton
I agree Raymond. I bought my house in Sept. of 04 in Caughlin Ranch and my most optimistic estimate is that it is now worth about 25% less than I paid. It could well be down 30%.
inclinejj
Talus Point..the whole rest of the unsold units where foreclosed on last month
tuzzoo
Talus Point…….another bubble flipper trainwreck……underwater flippers trying to survive by renting…….a year from today selling for $70K……..
Linda Nicoll
If you take a look at the virtual tour you will see the changes to the Dant listing, major, major renovations!
SkrapGuy
Linda, are you the listing agent for the Dant property? If so, perhaps you could refer us to the comps upon you rely to support the pricing for the house?
Thanks.
Martin
I too would like to see the comps for the Dant house. I am hard pressed to know of a house that has has gone up in value, not down, since the end of 2004. What supports a 10% increase in value for this house when every other house in Reno has lost value in the same time period?
It really doesn’t matter what Mr. Fox paid, what he put into the house in improvements, what he owes against the house, or what he “feels” it’s worth. The market really has no interest in those things. What matters is what are comparable houses selling for now. And I think that means selling, not what other asking prices are. So I await with interest the comps that are relied upon to support this pricing.
Also thanks.
Reno Ignoramus
Thanks, Ms. Nicoll, for venturing onto the blog. Welcome. Before you respond, allow me to advise you that this blog is something of a “no spin zone”. The people who post here are some of the most knowledgeable and informed people in Reno regarding the real estate market and real estate in general. Straight answers are well received and well regarded. Realtor platitudes and spinjive are regarded less enthusiastically. So again welcome and I too await your response regarding the pricing analysis of the Dant property.
Murray
Reno personality NOD? I need another clue?
parnell1
Murray,
Oh, I get it you “Neda” another clue…..
parnell1
Marcus
Hello blog!
After looking at houses for OVER 2 years I have finally put an offer in on a property my wife and I fell in love with. I won’t mention the property but will say we offered $82/sqft, the go e has incredible views and is located in wingfield springs. Our offer is BELOW all the comps as well as what is currently listed.
Wish us luck! 🙂
smarten
I’ll wish you luck Marcus! Please let us know how things work out.
I’m sensing a change in the market here in Incline Village. A new non-distressed listing my wife and I are interested in that has been semi-aggressively priced, has received an offer after only a couple of days on the MLS.
Another property we’ve had our eye on for some period of time just had a $279K price reduction and is now on our offer radar.
Of course I previously posted on the Delacroix REO that I said I would submit an offer on if I were inclined to buy in Reno proper.
I’m not saying we’ve turned the corner. But change is definitely in the air.
Raymond
Smarten, do you mean change in the sense of sellers in the higher priced properties starting to get realistic and dropping the price? Delacroix certainly represents a big price reduction. A $279K price reduction sounds substantial,unless it is on a multi-million dollar house.
Martin
While awaiting Ms. Nicoll’s response, I just read a story on a national news outlet that says that 1 out of every 9 houses in the USA is vacant. Not 1 out of every 9 houses that are for sale, but 1 out of every 9 houses. Almost 19 milion vacant houses in the country. That’s astounding and it redefines the meaning of a housing glut.
I recall that Guy has reported that almost 45% of all houses on the MLS in Reno/Sparks are vacant. Does anybody know what percentage of houses in Reno are vacant overall?
inclinejj
Take a look at days on the market in Incline..some of the agents in town are still pricing properties way higher then they should..Why? The know the next agent down the street will take the listing hoping the sellers will lower the price back in line..
Of course there are people out there with cash and who have the financing in place who can jump on a property priced right..
I look at a property the other day in IV but the agents where too out there on the pricing to make anything work..
I strong suspect this property will soon be on the nod sheet
Reno Ignoramus
Since the topic of this thread is Depression, it’s hard not end up in Somersett.
MLS # 90001296. 1955 Russelll Pointe Cr. Purchased in 11/05 for $893,567. Listed now at $590,000. Even if the seller gets 95% of asking, or $560,000, this is a 37% decline in price.
Now this does not come close to the 63% decline in price of that property in the Village at Somersett that was the subject of Guy’s auction thread, or the 50% off in Sierra Canyon houses, but it’s yet another example of Somersett Depression.
Tonight there are 121 listings on the MLS in Somersett. 97 of them are under $500,000.
Now I know that the Dant house is not in Somersett, but tell me again how a house has gone UP in value in the last 4 years?
marcus
Depression does hurt, and unfortunately our offer on the house wasn’t the only one. It looks as though we won’t get the house. very sad indeed… especially after considering I have been looking for almost 3 years…. only to have the house I love taken..
oh well such is life…
downtownjunkie
Marcus,
The best advice I can give you is keep looking and be open to everything. It seems when people find something they REALLY want, they overpay for it.
Believe me, there are more options out there right now. Good luck.
g-dub
Party Bathroom, LOL. My friends have one of those – I’ll ask them if they’ve had any parties in there. Probably just a party of dirty dogs.
I did see a couple of “carwash” showers – in one door and out another.
I visited Reno 2 weeks ago and saw some open houses in Arrowcreek – and took a look at Toll Bros. Montelena up there. They are offering at $200k less than a year ago and offering 3.99% financing. The new model is gorgeous. Sigh.
I’m still not able to move due to business constraints here in Cali but I feel like Atlas is going to shrug any moment. I am being chased out of here by personal and corporate taxes. AND the new 9+ sales tax.
I feel that the spigot of refugees from Cali will turn back on as soon as people here can sell their homes again. California is not giving us many reasons to stay.
Sully
g-dub, except for the weather – what are the other few reasons?
inclinejj
RI
Tonight there are 121 listings on the MLS in Somersett. 97 of them are under $500,000.
How many total houses in Somersett?
Reno Ignoramus
I have no idea incline. But I remember when Diane lamented that 60 listings in Somersett was way too many, and when Guy said there were no listings there below $300K (now there are 5 below $200K and many more below $300K)and when many in the early days of this blog said Somersett was bound and destined to be a mostly million dollar and over community. Hence, my point.
g-dub
Um, more ethnic restaurants and markets? I can’t think of anything else right about now Sully, LOL! If I move to Reno I’m sure I can get ethnic groceries once in awhile in Sacramento. I’ll miss my friends but they can visit me.
tallguy
Ummm.. CA surf, mountains, fresh organic produce and fruit year round, the coast, art, beautiful CA beach girls, cheap great food, cheap great wine, steelhead and salmon, the chance for an intelligent conversation with a random person on the street (SF much more than LA), businesses that are the cornerstones of the 21st century economy.. need I keep going on?
downtownjunkie
You had me at CA beach girls.
Back2Basics
Maybe things are picking up?!?
In the last two weeks, two houses went pending within hours of when we were going to submit an offer. Both are short sales however, so there’s still a chance for us later, right?
The first was only on the market for 3 days! (it really was a great house for a great price) The second had been on the market for 180 days! Yet on the same day we were going to submit our offer, it goes pending. What are the chances?!? Somebody was very busy over Easter weekend. Unfortunately it wasn’t us.
Lesson learned: if you’re desperate to sell, have us come get serious about it. Someone else will snatch it up instead! Crazy.
Incline
What Salmon..Salmon season has been closed for almost all of last year..minus a small season on the Upper Sacramento River last year
Looks like another closure this year..
Steelhead runs where the lowest since the mid 70’s drought
Thank you Arnold for sending all the water down south
Waldo
Hey Back, would be kind enough to share with us the price range you were going to make an offer in? I think multiple offers are fairly common now in REOs and short sales. It has been discussed before here how banks and short sellers are trying to create an auction type scenario. This is why 80% of what is selling is either an REO or a short sale.
And yes, if it’s a short sale, it has a much greater chance of never going on to close than if it’s an REO.
Back2Basics
Waldo,
Our price range is $250-$300K, but we’re trying to get the most bang for our buck since this will be a long-term home. Location/land is key. We want good schools for our 4 kids, a short commute to downtown, and an actual yard with at least a quarter acre or more of usable land. This would have been impossible a year or two ago in our price range, but now is starting to look doable.
As far as an auction-type scenario, that might have been the case with the first house that went pending in 3 days, but not really with the other one that had been on for 180 days, just dumb luck.
We’re going to lay low and wait for the right place at the right price to come along again. I guess we’ll have to be ready to jump quickly though.
Reno Ignoramus
Back, your comment warms my heart. I love hearing stories about families who want to responsibly purchase a decent house in a decent neighborhood without having to commit financial suicide with a Voodoo loan in the process.
Congratulations to you for not buying into the hype of “real estate always goes up forever” or “buy now before you get forever priced out”. Congratulations for not going out two years ago and buying a house that you could not afford with some “creative financing” that was guaranteed to blow up in your face.
I do not believe that the housing market in Reno is at the bottom, and I believe that you will see some even better deals arise in your price range in the next several months. Best to you!
DownButNotOut
This blog was built (even has thrived) upon the ability of the poster’s to read the RE economy downturn accurately. I consider many of your posts very insightful. Many sound like you buy into what’s made this blog popular; namely the ability to put down Real Estate as an investment.
Maybe when you buy a house at market value, live in it for a while, then sell it, you have no right to expect a profit, or consider it an investment.
But I’d suggest that for most of us our house is something more than that; we leverage overall cost by putting up a smaller percentage for a down payment, we raise our families in it, do improvements upon it, parlay it into a bigger investment(via collateral on all kinds of things, in my case a business), ultimately pay it off and retire when we haven’t a payment on it anymore. The psychological effect of home ownership is understated.
So if you spend a year or two looking into buying a house at that bottom line price that apparently has yet to be found, will the wait be factored in to the price you pay for where you’ll call home?
Or put another way, will you know the bottom when you see it?
, what value does that energy and lost time have?
Does anyone else feel this way? I’ve stopped
posting here recently because my views haven’t been widely (or narrowly) accepted. But since I see many people buying out there, we seem to be
DownButNotOut
a minority here.
(sorry I hit send too early)
NVMojo
Moved here almost 3 years ago from boomtown Elko. Jaw hit the ground when we saw dumps selling for $300,000 over near Traner Middle School. Rented ever since in spite of really wanting our own home like we always had with good old fashioned financing.
Followed this blog and the smart folk who write it and those who comment on it for 3 years. It’s been a wild slide down.
Maybe we will be purchasing by the end of the year when our current lease is up.
Cheers.
Rory
When I think of places which are overrated, I think California. Tallguy, do you work for the CA Commission of Tourism? Having lived in CA for 15 years, you can have it. With your budget woes, the pain and suffering are only just beginning. Organic fruits and veggies year round? Are you serious? LOL Thanks for the laugh. When they say organic, they mean they leave the bugs on the produce for you to pick off, enjoy.
Harley
“With your budget woes, the pain and suffering are only just beginning”.
Talking about Nevada no doubt. Nevada’s budget deficit is every bit as bad as California’s.
Gary
I loved the “party shower” in the virtual tour. I also noticed a small room off the spa and gymnasium that appeared to be a small chapel or meditation room, complete with cross and candles. I suppose that would be a good place to ask forgiveness for the unspeakable acts you performed in the party shower 😉
tallguy
I could easy make a similar list of drawbacks and negatives… I just assert that are many good things to like about CA, along with others to dislike. The real decision is balancing the two, which wasn’t what Sully was asking in the first place.
marcus
Is it just me or are 95% of all the houses for sale in reno between 250-300k JUNK? Talk about depressing trying to find a decent property.
I have cash and yet I STILL cannot find anything that interests me!
CommercialLender
DBNO,
Many on this blog, having seen this correction some time ago, are milking the correction for as long as it remains profitable to do so. Is there anyone on this blog who feels home prices are going to be rebounding thru 2009? Then why should a buyer not continue to sit and wait a few more months? Has this Marcus poster been richly rewarded for waiting nearly 3 years to buy? Seriously, DBNO, his waiting has been perhaps the best thing he could ever have done or ever will do.
You posted: “The psychological effect of home ownership is understated.” Unlike virtually all the people I knew before 2006, I defined your ‘effect’ as a potential huge negative one, not the traditional positive one you seem to suggest. That was just my point when I sold my primraily in 2005 and began renting. I thought: saddled with stiffling debt? Illiquid investment? Unsustainable rise in housing prices? Pressure to keep up with the Jones’? Forcing my wife to work to make ends meet instead of having a more family centered, less pressured lifestyle with her at home with the kids? See, its not having an overpriced home (you implied by “leveraging overall costs”) that equates to my family’s quality of life.
Sure, I was a bit ahead of the curve evidenced by the fact that all of my friends/family thought I was crazy at the time to sell my primary residence and rent, but now I can’t tell you how many of my friends are doing the same or wishing they could. One of my friends who bought and rehabbed is now struggling and can’t afford a family vacation. Another is losing his job after having already lost his 2nd home. That’s some “psychological effect of homeownership” to me.
This blog’s posters are not prophetic market-timers, but I feel some of us felt strongly our fellow man was walking off a cliff. I and others wrote over the months/years about this mess as much as a way to warn others as anything.
Now, in retrospect, it will take many years for people to look at the ownership of homes in the former positive light. This ‘pschological effect’ will continue to pressure home values downward, in my opinion, and will reinfornce the coming U versus V shaped recovery.
You seem to bemoan us renters as market timing investors who think their home is an investment. Well, it is, in fact the largest ‘investment’ many of us will ever make. So why not read some tea leaves to make an educated decision? For now, I for one enjoy not being tied down, paying only 1/3rd of what I would normally be paying to own, and face very little risk in doing so and having tremendous buying power (cash and no existing home contingency). (Out of disclosure, I’ve said here before one can’t market time as their primary investment strategy.)
****
Finally, DBNO, did I read you correctly that you put your house up for collateral for a business? You said … “parlay it into a bigger investment(via collateral on all kinds of things, in my case a business)”. If so, you may want to consult a financial advisor. There may be cases where sometimes that would be advisable, but only in very limited, rare occurances. If I read you correctly, you just treated your very home you suggest is not an investment into an investment. By placing your home as collateral against a business, you are putting your family in tremendous financial risk. Again, your situation might be different and if so, please share if you can.
Raymond
Well, it’s been 4 days since Ms. Nicoll was invited to explain the pricing analysis on the Dant house. Haven’t heard a word from her. It’s quite amazing, actually, how so many realtors just vanish into the mist once they are asked to explain a listing price in a dispassionate, hype-free, financially literate manner.
I’ll say it again: I think the Dant house is overpriced.
DownButNotOut
CL – I’ll get back to you when I clear up my laptop mouse problems. Sorry about the above.
DownButNotOut
All right, I think I have my mouse problem fixed.
CL – I had composed a nice response to you’re above post, but it evaporated by some computer whim my laptop seems to possess these days. Ironic since I employ a dedicated computer IT guy in my business.
As to what you wrote, I’ll summarize with this; Everyone has their own paradigm that influences decisions in their life. You obviously are proud you got out of home ownership in ’05 and that you rent now. And if making money on your primary residence is what you wanted, then you’ve done well. I on the other hand have lived in my same house for 28 years. I was married here, I’ve watched my kids grow up here, they’ve come back after college and military service, one was also married here. I didn’t sell in 2005 although I guess I would have made a lot of money, because I’ve never considered my home an investment in anything other than it is: my home.
The point I was trying to make was there are a lot of lurker/poster new buyers that only get advice from the same group – one that advocates waiting because as you point out ‘who really thinks RE is going to appreciate in the near future’? (go easy everyone)
I was saying that this is a good time to buy from a first time or move up perspective because interest rates are low, stock is high, there’s plenty of time to check out perspective houses, and the pressure is off this buyer profile.
Now imagine that person waiting 3-6 months thinking that prices are going to go down more, (advocated here and probably correct). Now envision the scenario as interest rates begin to creep up, the bottom has been reached, and home sales begin to sell a little faster. A buyer in this scenario has to decide faster, maybe compete against more multiple offers, pull the trigger quicker
Imagine the stress on a young family is in this circumstance. The money saved by prices going down could be minimal compared to some of the above factors, especially spread over 30 years (spare me the math!)
No CL this isn’t you – you’ve made your story abundantly clear – you sold, you profited and now you happy to rent. That’s not necessarily what everyone one wants.
CL – as to giving me financial advice – I’ll take the high road and just say you haven’t a clue of what your talking about, although I’m sure you meant it constructively. I’ve put my money where my mouth is when it comes to Real Estate and life. Without a doubt I’ve made plenty of mistakes, but one of them wasn’t listening to my financial advice from a blogger.
Transplant
marcus asked,
Is it just me or are 95% of all the houses for sale in reno between 250-300k JUNK?
A: It’s not you.
joe
This is my first time posting, but I’ve been reading this blog regularly since early 2006 when I moved here. I’ve been very content renting a nice home for the last three years while prices drop. Having lived in Idaho, Utah, and the midwest, I’m still amazed that some people here think that these currently median-priced homes are a good deal. Don’t get me wrong, I love it here and it definitely beats the midwest, but I don’t see why someone would pay over $120k for a small stucco box on .10 acre. It doesn’t matter if it used to be ‘worth’ $250k. I’ll rent as long as it takes to buy something I really like. And as far as the worry about interest rates going up, how could home prices not drop more as interest rates go up? Like so many have said here before, it’s all about affordability. People just can’t spend half of their income on a home mortgage, or probably shouldn’t anyway. But thanks to Gotlots, Bantering, RI, and so many others for the great info over the years. I’m sooo glad I didn’t buy in 2006 like I almost did.
marcus
on a positive note my house received 2 offers after being listed for only 2 days? Yes?thats right 2 days?
what happens next is even crazier?I found a house that was absoultely goreous and it was only on the market for 1 day??
YES 1 day?
and guess what it already had an offer for full list price and I lost out on it?
FYI both my house and the one I wanted both received FULL price offers??
now what to do ????????
marcus
sorry about all the question marks I forgot to change the language settings on my laptop
DonC
marcus – My advice is free and I’m sure it’s worth every penny! It’s also simple: keep looking.
Unlike many here I’ve been suggesting that we are in the process of putting in a bottom. But that doesn’t mean the world is going to change immediately. My guess is that prices, at least in some price bands, will still trend lower for some time. No need for panic buying.
In this regard, the WSJ had a front page story yesterday about a new wave of foreclosures. Banks have been holding back waiting for the details of the Obama Administration’s home owner aid plan. Now that is out and foreclosures are accelerating. That will put downward pressure on prices. It’s not like you’ve missed a narrow window of opportunity. From personal experience there is always another house, no matter how “perfect” you think the one you didn’t get was.
CL & DBNO – Both you guys have perfectly reasonable positions, it’s just personal preference.
CL, you had some good sized cahoonas when selling. I thought that course of action was a pretty good one but I don’t think I would have had the courage to pull the trigger. Then again I’m more in line with DBNO in the way I look at housing — I think we’ve disagreed before about whether a home is really an investment.
In CA it’s also complicated by prop 13 since housing is more likely to just go sideways for years than it is to drop (maybe what we’re seeing in IV?). With Prop 13, if you buy at $100K and sell at $300K and then buy again at $200K you may end up with higher property taxes for the rest of the time you own the home.
Sully
I agree with DonC (amazing!) that CL and DBNO both have good points. In my case, I more or less followed the road CL took.
I also think we still have a way to go before bottom is in, this summer should prove that out when the pent up wave of foreclosures hits the market.
That being said, there are some reasonable buys out there right now. I found one that was priced close to the current median that is well built.
By that I mean: cast iron sinks, American Standard toilets, raised panel cabinets in wood, not press board, tile roof, real stucco (not painted on texture coat and a few other amenities.
The above house met my standards for quality and the price was close enough to my target to warrant an offer, which BTW was accepted.
But that may not be for everyone, especially those that expect the price to hold, I don’t. But life decisions are sometimes made for reasons that put money second and life style first as is in my case.
Please feel free to attack the hell out of this comment! 🙂
Sean
Diane- I noticed your house went back on the market today at 545k. What made you decide to try to sell it? I assume that is a short sale price? I thought you were going to keep it?