Canyon Drive is the backbone of the Juniper Hills neighborhood in what the MLS is now calling the West Southwest. It is "old Reno" – not necessarily the biggest money neighborhood, but the home of a lot of power Reno families. Doctors, lawyers, judges (Sandoval and Flannigan), of course some realtors, and a lot of just solid families. It does not have the cache of the real Juniper Hill Road neighborhood (it is worth a trip up this road if you have never done it – does anyone know the story behind 550?), or the flash of the newer Juniper Trails subdivision. This area of apparent stability has been getting a reality check lately.
– 5050 Canyon just sold at a Trustee’s Sale for $275,828. It was purchased for $350,000 in August 2001 and leveraged up to over $600,000 in loans. It is a nice house with a pool. My recollection is that it was listed as a short sale at $525,000 before being reduced to $475,000.
– 5045 Canyon is right across the street. It was purchased for $435,000 in September 2003, and has been going through incremental remodeling ever since. It is currently listed as a short sale at a reduced $307,000. The debt load is at least $575,000, even after selling off over $50,000 in water rights. Last payment was October 2009
– 4885 Canyon was listed a few years ago as "Juniper Hills for Under $500,000" a couple years ago at $495,000. It got into contract at some point, but apparently had some inspection problems, and was eventually withdrawn at $425,000. It is now in contract as Active Pending Loan at a reduced $292,000 list price. The house was purchased for $197,500 in November 1996, and I think the debt load is about $310,000 at this point.
– 4755 Canyon sold as a short (I’m not allowed to disclose anything about the former owner, but it’s juicy). 4695 is confusing, but apparently sold as an REO for $340,000 in February after a previous sale for $735,000 in August 2006. 4375 was purchase for $620,000 in October 2005 in a probate bidding war at lot value as a probable lot split. It has been floating along on the MLS for a couple years, reduced to $525,000 at my last recollection, and now seems to be withdrawn.
– 4125 Hackamore is our famous IHOP house. Purchased for $465,000 in August 2007, gutted and partially remodeled and left exposed to the elements for two winters, it finally sold as a short in March 2010 for $185,000. It is currently undergoing renovation – some areas had to demolished completely.
– 4305 Canyon – .8 acre of vacant land, now reduced to $154,000. The owner originally thought it could sell at $400,000 when it went through the subdivision and entitlement procedures in 2005, and originally listed at "only" $278,000. My (yes, I am the bonehead owner/developer) price reductions helped systematically reduce housing values in the neighborhood. But on the bright side, when you combine it with my 5070, 5090, and 5790 Mayberry properties, you can do a 3/4 mile float tour down the Last Chance Ditch all on my property! Maybe that can be a RRB event this summer.
Funny, when I did my Google search for an image search for this post, the one i chose happened to be Hell’s Canyon.. Pretty descriptive of the situation.
donna
“4755 Canyon sold as a short (I’m not allowed to disclose anything about the former owner, but it’s juicy)”
Some formerly rich dude who lost a lot of money in Reno real estate holdings has a blog “rereno.com.” Perhaps, you could post the delicious details there? I hear the owner is nice, but it’s just a viscous rumor.
Reno Ignoramus
If I recall correctly, the very first comment GreenNV ever made on Diane’s blog was about his lot at 4305 Canyon and the big plans. But hey, it was back when a lot of people still denied, on this very blog, that there was a bubble in Reno real estate.
Canyon Drive was at one time, back before Caughlin Ranch was developed, the premier neighborhood in that neck of the woods. What happened on Canyon Drive is really not all that different that what happened all over town. And what is happening there now is not all that different than is what is happening all over town. The bubble inflated. The bubble is deflating.
I have been saying here since 2006 that watching this bubble deflate is going to be like watching paint dry.
The paint on Canyon Drive is still drying.
bob_c
Every home mentioned has or is in the process of
being ‘turned over’ due to the housing bubble.
This is a positive. The entire area is being cleansed of the hubris. For an example, the somersett development has been pretty thoroughly
‘cleansed’…not too many holdouts hoping for a rebound that isn’t coming. This is healthy.
The washout is nearing completion and a new base can be formed. This base will take a few years and then real estate can resume its BORING just barely exceeding the inflation rate rebound. Nevada is NOT a prime area. Real estate will never be a MEANS to wealth around here. But there are very nice affordable homes for those who reside here.
BanteringBear
It seems to me that Mike made the same mistake most people did by “following the market down” with his piece of dirt. I would have thought since he was not only a reader, but a contributor to this blog, he would have been aggressive in pricing it and unloading it in years past, before the market cratered, around the same time we were advising Allen “I don’t have to sell (then why are you in foreclosure?)” Murray to do the same. There are no guarantees it would have sold, of course, but at least he could have given himself a chance.
$154,000 for a large building lot fronting Mayberry is a pipe dream in this environment. It’s not a prime Canyon lot up high with views, though it is priced as such. The only thing it shares in common with such properties is the street name. It is much more comparable to the properties along Mayberry, which are not prime because, after all, who wants to build or buy a house, let alone a half million dollar house, on a busy street?
smarten
RI –
Your comment regarding watching paint dry got me thinking. So I’m wondering if your views are the same for a similar yet different portion of Reno.
Just for giggles, I went to zillow.com; plugged in South Reno as a search area; plugged in recent SFR sales in the $170K-$180K range [our median sales price strata for the last year]; and, concentrated on those built in 2003-2009 that originally sold for the first time in 2004-2009.
I came up with five:
1. 1990 Sierra Oaks Ct. [3/2, 1,345 sq. ft], built in 2004, originally sold for $228K in August of 2004, resold for $176K in January of 2010 – down 22.8%;
2. 2140 Evergreen Park Dr. [3/2, 1,345 sq. ft], built in 2004, originally sold for $254K in June of 2005, resold for $172.5K in June of 2009 – down 32.1%;
3. 1865 Stetson Dr. [3/2, 1,540 sq. ft], built in 2005, originally sold for $295K in April of 2006, resold for $176K in July of 2009 – down 40.3%;
4. 2195 Evergreen Park Dr. [3/2, 1,294 sq. ft], built in 2005, originally sold for $334K in April of 2007, resold for $180K in January of 2010 – down 46.1%; and,
5. 1850 San Joaquin Dr. [3/2, 1,260 sq. ft], built in 2003, originally sold for $365K in December of 2005, resold for $175K in November of 2009 – down 52%.
So do you think we’re still watching paint dry on these five SFRs, or are they ready for a second coat of paint?
Sully
smarten, alluding to what bob c said in above post first. These bubble babies are pretty darn close to a second coat. Light at the end of the tunnel. However, there are still too many houses, especially in south areas, that someone put some slow dry chemical in the paint. Still possible for some correction in above areas, but more for normal reasons then bubble reasons. In my post to RenoBaby, that is what I was referring too. Some areas are highly unlikely to show anymore downside, but others need some more time.
smarten
I agree Sully –
Someone defines “the market” by unit sales and median sales price; as measured by these parameters, the market has been relatively stable for the last year; you, I Bob C [and a couple of others] merely verbalize the obvious; and the permabears come out of the woodwork asking how anyone can be talking about a “bottom” when the Euro is going to hell; the stock market is tanking; unemployment is up; foreclosures are up; absorption rates are up; the unaccounted for shadow inventory; 75% of sales are distress; the $500K and above strata of the market is dying; Mike’s pooch Dyson is cute [just threw this in to see if you were still reading]; yada, yada, yada? It’s because they are two different concepts.
If we’re limiting our discussion to measuring “the market” by median sales price, then can we please do so? If we’re not, then exactly what are we talking about when we speak about a “bottom?” It seems to me that if my price range is $150K and below, this strata of the Reno/Sparks market has pretty much bottomed [realizing that there are always individual exceptions]. However if my price range is $750K and above, it has quite a bit farther to go [again, realizing that there are always individual exceptions]. And if we’re talking about Incline Village…Nah, I won’t go there.
Here my point was that although the paint may not be dry on Canyon Drive, the temperature’s a bit warmer as one goes south.
BanteringBear
Smarten posted-
“If we’re limiting our discussion to measuring “the market” by median sales price, then can we please do so? If we’re not, then exactly what are we talking about when we speak about a “bottom?” It seems to me that if my price range is $150K and below, this strata of the Reno/Sparks market has pretty much bottomed [realizing that there are always individual exceptions].”
This is a concept which I do not believe in, and I have voiced this before. This is your opinion, and you are wrong as far as I am concerned. People are, right now, paying $100k+ dollars for houses in Sun Valley. They are OVERPAYING, IMO, and will realize losses in equity as the market of higher priced homes continues to deteriorate. The entire market is interconnected. If houses under $150k have bottomed, what does that say for houses priced at $155k? I’m just interested in how you even arrive at such an absurd concept.
skeptical
Smarten,
I’m reconsidering my perception on whether or not this is a bifurcated market. I used to solidly believe that it was, and that price compression above $300k would counter-intuitively raise the median for the whole market, even as prices were falling.
Guy’s recent thread on the matter, though, gave me some second thoughts. While I still suspect that purchases at/below median are safer, and above that are more risky, I’m open to the possibility that overpriced properties (and some values) exist at all price levels.
For example, I used to think that Smithridge condos were footstomping values at $49k. Now, I wonder. There seems more than enough to go around for any interested buyers…
Additionally, I notice that over on Mitch Argon’s site, there are 125 price reductions in the last 5 days. This is a very high number for that stat. 60-70 such reductions are typical. So, it seems that the expiration of the tax credit has sellers providing incentives of their own, but I digress.
The point is that of the 125 reductions, only 30 are above $300k. Perhaps this is just a reflection of the listed market distribution. Or, perhaps there is still some fat in the list prices of sub-$300k homes, post tax credit expiration. FWIW….
BanteringBore
Why isn’t anyone paying attention to me?!
SkrapGuy
Talking about the Canyon Drive neighbohood brings back memories of the $800K barn. I note that the picture of the barn is still up on the blog after all these years.
Nothing ever discussed on this blog more epitomized the absurdity of the bubble mentality than the $800K barn. Somersett and the Montage come close, but for one single snapshot of the bubble’e delusional absurdity, the $800K barn stands alone.
BanteringBear
Even more pathetic than the $800k price tag on the barn was the video of the greedy owner trying to talk the place up, offering architectural drawings for the whole “renovation” as if somebody was going to pay $800k for the opportunity to start paying hundreds of thousands more to carry out her vision. If it was such a great idea, why wasn’t she doing it?
Bantering shill (lurker)
BB ‘If it was such a great idea, why wasn’t she doing it?’
I’ve followed you for a while. Your a talker, not a doer. No mystery to anyone that reads your venomous spew. That’s because instead of understanding the entrepreneurial mind, you choose to criticize anyone’s decision to take a chance. If you had your way there would be no need for anyone to do anything other than what you think should be done. Yet you’ve done nothing, not even gotten the 10 acres you so closely desire.You a buffoon that monday morning quarterbacks those people that have taken a chance, all the while living in your shell. Pathetic. Get a wife. Get another dog. It might make you happier.
KingBud
Woa, it’s getting intense on this thread right now 🙂
My personal view is that the residential single-family home market continues to trend down in all price segments in Reno/Sparks due to all the factors that Smarten mentioned in his above post, which is well thought-out.
Nevertheless, I acknowledge that it can make sense to buy in this environment even if you think prices are going lower over the next few years.
If you have a long time horizon and you’re going to live in Washoe county the next 20 or 30 years, buying right now is probably a good opportunity. Probably will be a once-in-a-lifetime buying opportunity.
My view is that you’re not buying at the bottom if you buy right now, but if one compares the value of 3 years of tax benefits from home ownership to the cost savings of buying the same home at a lower price in 3 years, you very well might find that the value of the tax benefit exceeds the purchase price discount you realize deferring the purchase a few years.
If you’re a condo investor and you buy a unit at Smithridge for 50K, if your investment cash-flows (it will) and you’re holding for even 15 years, does it make sense to give away 3-5 years of the tax benefits of ownership and cash-on-cash return to hold out for a lower purchase price in a few years of maybe 45K ? Probably not.
billddrummer
Don’t worry, BB, no one pays attention to me either.
DonC
The one thing we can be certain of is that Mike has a wicked sense of humor.
BanteringBear
I just hope Mike diversified his portfolio, and didn’t go all in on Reno real estate. If he did, his poor “Berner” is going to be eating “Ol’ Roy”- a certain death sentence.