The Center for Regional Studies just (finally) released their March 2009 and Q1 numbers. The median cost of a new single family home in Reno was $133/SF, and the median cost of a resale home was $115/SF ($404/SF in Incline, for reference).
8556 Timaru in the ‘Sett just listed for $297,000. It is a 2593 SF 3/2.5. It was purchased in December 2006 for $689,871 ($266/SF) and the current listing price represents the City average of $115/SF. That is a 57% decline. The house doesn’t look like it has been "Juaned", though the landscaping is pretty well shot.
The same former owner tanked 1678 Spring Hill in the Village. It was purchase in March 2006 for $414,900 or $204/SF. It is currently listed at $260,000 ($128/SF), though a twin model at 1654 Springhill is listed at $169,900 or $84/SF. (1690 is listed slightly higher at $91/SF). Remember that auction here?
8440 Castlehawk just listed at $450,000 or $148/SF. It was purchased in April 2005 for $795,536 or $261/SF, so the decline is about 43%.
8475 Castlehawk just sold out of foreclosure in March for $455,000. This house is a twin size wise to 8440. Originally purchased in April 2005 for $691,147 ($227/SF), the recent purchase represented at 34% decline to $150/SF.
Diane’s short sale home was purchased for $191/SF, and is in contract at about $135/SF, only a 29% decline. If the sale goes through, the lender ought to be facing Mecca and thanking Diane for obtaining the best worst case scenario in the neighborhood.
I guess the point is that $/SF pricing is all over the board right now. Pity the organic seller who has to compete in this market. Though have you noticed the huge swelling of "old" owners who have been listing their homes lately at very competitive prices?
SkrapGuy
To EdBear,
Well it looks like some units in the Village at Somersett may already be under $100 sq. ft. as I predicted. But apparently the prices on these places are deteriorating faster than I thought. So maybe you won’t have to wait for July 4 of 2010 to get under $100 sq. ft. But I see no reason, absolutely no reason, to think that the prices of these places will not contimue to tank. Maybe that $79 a sq. ft. at the auction will even fall. It’s hard to keep up with the tanking values in Somersett.
Martin
Mike,
How do you know what the offer is on Diane’s house? A bit of inside info? At $135 sq. ft. that is essentially a full price offer to her short sale asking price, no?
BanteringBear
The massive inventory overhang is having it’s way with prices. That’s what you get when you overbuild in such a grotesques fashion. As prices fall to levels unthinkable, angry owners should focus their venom on the community development folks who approved, and continue to approve, this massive sprawl. In the case of Somersett, particularly the Del Webb development, they are still building new homes as most of the resales in that development are in foreclosure or listed as short sales. More homes are the last thing needed, but they carry on.
Those “stronger hands” we’ve talked about are starting to weaken, or in many cases just tire of feeding the beast. I’ve read reports of the high end cracking in other markets, and I anticipate such a thing happening in Montreux, Incline, etc. in the not so distant future. It’s quite hard to put a time frame on it, but we shall see.
Sully
To add a little to BB comment. Until the feeder markets return to some form of normal, the Reno market will continue to decline.
In an economy based on tourism, you need tourist!
The better path for Reno/Sparks city councils, would be to create jobs, not more housing developments. Property taxes alone will not fix the ills of this area. Speaking of property taxes, all homes built in 2005 and later are taxed at about 2 times the rate of a house built in 2002. How long before taxpayers start to protest?
Getting an industry in this area that is independent of the gaming industry is a must. Warehousing/distribuiton just won’t cut it.
Raymond
To follow up on BB’s comment about the Del Webb development in Somersett (Sierra Canyon), I had lunch with a realtor the other day who told me that Del Webb will match any price of a resale in the development. In other words, if an owner manages to find a buyer who will to pay $X dollars for his house, Del Webb will sell the buyer a similarly sized new house for the same price. In other words, Del Webb will undercut their former customers. Since many houses in Sierra Canyon are now selling for 40-50% less than original pricing from 4 years ago, Del Webb apparently is willing to drive this market into the ground.
Disclaimer: I don’t know if this true as I have not verified it for myself, but I believe the source of this info to be reliable.
Frost
Anybody know how long ago the decision was made to close down operations at MountainGate? Was over there for grins on Friday and they are attempting to sell the models (at pretty outlandish prices…above the 600K mark to start) and have a few homes in inventory they are unloading.
EdBear
My wife loved them, but you’d have to be an idiot to pay the asking prices. Anyone have any idea what they are up to?
Thanks
smarten
Sully stated, “speaking of property taxes, all homes built in 2005 and later are taxed at about 2 times the rate of a house built in 2002.” Can you please expound upon this statement?
I know of two homes next to each other that are comparable in size, look and amenities. One of them is about 30 years old and was the subject of a massive renovation a couple of years ago – basically rebuilt from the ground up. The other is new. The assessed valuation of the new one is close to twice as high as the renovated one. Would be interested in the rational. Thanks.
inclinejj
I guess the point is that $/SF pricing is all over the board right now. Pity the organic seller who has to compete in this market. Though have you noticed the huge swelling of “old” owners who have been listing their homes lately at very competitive prices?
If someone had the cash to hold on to a property for 2-5 years why wouldn’t they? The only people to technically are selling now..are short sales, foreclosures, reo’s, bankrutpcy, divorce and pretty much distressed sales..
Selling now unless you 100% have too makes no sense to me what so ever!!!!!
Unless your just playing and figure what the hell, it is the realtors time, money and energy into holding the house open, waiting and having the sign sit out for 6 months and all the neighbors laugh and say..That agent takes over priced listings, that agent is high, that agent is bored and takes any listing at any price, or that agent can’t sell the house up the street why should he get my listing!!!!!!!!!
daily
Last time I checked, Ryder is privately held, so they’re entitled to hold their numbers (good or bad) to themselves. Driving by the development on a daily basis, don’t see much going on. Most of the activity seems to be located at the entrance with the picketing. Hope this isn’t going to be another R&B scenario.
A lot of builders are pulling stakes. Toll closed down all sales, with the exception of Dorado.
Adios.
downtownjunkie
I was interested in 8556 Timaru. By the time it took me to put together some financials for lending the property already had 8 offers. Most likely for more than the asking price. The property was very nice with upgrades everywhere. Hopefully the banks learn from this and price the properties BELOW market. This way they get actual interest from actual buyers and actually sell the property.
Kind of a rant…
Rory
I think people are tall tales about Del Webb. Pretty funny actually and clearly written by people with axes to grind. There are very few houses for resale in the community but there remains significant demand for new homes. Because there is demand, Del Webb is willing to be the supplier.
BanteringBear
Rory posted:
“There are very few houses for resale in the community but there remains significant demand for new homes. Because there is demand, Del Webb is willing to be the supplier.”
Kind of a foolish statement considering there are a few dozen Sierra Canyon homes rotting away on the mls, at least half of which are bank owned or short sales. Asking prices are now as low as $165k, and still sitting. This doesn’t even take into consideration all the rentals available from specuvestors who are “waiting for the market to turn around.” Sierra Canyon is an absolute disaster, a foreclosure wasteland. Those lots are so small and prolific that the land is worth essentially zero. I can easily see two bedroom homes selling south of $100k.
Horizon
Uh Rory, can you read? And count? Perhaps you ought to go to the MLS and look up Somersett. You will observe that Sierra Canyon is leading the way down with numerous REO and short sale listings. Then go to Craigslist too.
In fact, Rory, only in Sierra Canyon are Somersett houses selling for 50% less than they originally sold for. Now granted this dubious distinction is being challenged by the Village condos and some other REO properties there and 50% off will no doubt become the norm all over Somersett in the coming months. But Sierra Canyon has been the leader in price depreciation virtually since the bubble popped and all the flippers there got burned.
Ann significant demand for new homes in Sierra Canyon? Puh-lease. Go to the County Recorder’s site and search and see how many houses have sold there in the last many months. Sierra Canyon is a trainwreck.
Raymond
Rory,
Do you work for Del Webb? You say there are very few houses for resale in Sierra Canyon?
Here’s a list of all the houses currently listed on the MLS in Sierra Canyon:
1. 1530 Orchard Park SHORT SALE
2. 1815 Trail Creek REO
3. 1390 Meridian Ranch
4. 1330 Meridian Ranch
5. 1899 Evergreen Ridge SHORT SALE
6. 1310 Cliff Park SHORT SALE
7. 9020 Cabin Creek SHORT SALE
8. 9106 Heritage Ridge Ct. SHORT SALE
9. 1310 Hidden River Way
10. 1242 Firely Ct.
11. 1040 Meridian Ranch REO
12. 2572 Whitney Oaks
13. 1820 Trail Creek REO
14. 1100 Meridian Ranch
15. 1420 Orchard Park
16. 9170 Spruce Creek
17. 1735 Trailcreek
18. 9210 Palmetto
19. 9270 Palmetto
20. 9240 Hidden Peak
21. An unidentified address in the MLS listing
According to the Washoe County Recorder’s office, since the first day of 2009, there have been 7 deeds recorded from PN II Inc. in Sierra Canyon.
Rory, that’s a whopping 1.4 houses a month Pulte has sold there this year. Is this what you call the “significant demand” for new homes?
Martin
Man I just love it when the happy talk spinmeisters happen to wander onto the blog. We never did hear back from the realtor on coach Fox’s house about what comps she relied upon to support the asking price, did we?
OJ Lawless
What’s this “Juaned”?
billddrummer
To OJ,
“Juaned” refers to a home that has been gutted of fixtures, appliances, flooring and sometimes landscaping by the owner who was foreclosed on and forced to move. It’s a revenge play to “fix that greedy bank.”
I believe the term first started in the Inland Empire of Southern CA, when homes that were foreclosed upon were missing sinks, ranges, refrigerators, toilet fixtures, copper wiring and pipes, A/C units, pool pumps, and light fixtures. Those flat panel light switches go fast, too!
Many of those homes were purchased by Hispanic families with multiple generations and spotty income verification. Thus the moniker “Juaned.”
OJ Lawless
Bill —
Regardless of the source there’s unnecessary ethnic baggage to the term that I would think a professional industry could avoid. How would you describe the prospective property to a Hispanic client — unless his business would be no good in the first place?
I found it an unfortunate term as I’d really been enjoying the blog up to that point.
billddrummer
To Otto,
You’re absolutely right, and it’s unfortunate that name-calling still exists. What’s worse, in my view, is the number of Hispanic names that show up on the NOD and TS lists. I posted on that phenomenon last year, and while it seems that the proportions are lower (a year ago, about a third of the NODs had Hispanic or Central American surnames), it’s still disturbing.
Could it be that mortgage lenders who were fluent in Spanish originated some of the loans that are now in default? And if that’s true, where does their responsibility lie?
GreenNV
Bill and Otto,
The term was used as a reference to a specific individual who trashed their house before moving out – it caused a lot of hot discussion on the blog. No other connotation was intended.
billddrummer
To GreenNV,
Thanks for the clarification. I appreciate it.