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September 2009 Home Sales Results – Carson Valley Real Estate Market Report

We had 45 homes sell in the Carson Valley in September 2009, compared to 56 sales in August of 2008. That means our sales volume was 20% lower in 2009 than it was in 2008. Perhaps our buyer pool is drying up? We had 41 sales in August 2009, so our volume is relatively steady when compared to last month. Will sales pick up in October because the First Time Home Buyer Tax Credit ends on November 30, 2009? If you’re not in escrow by October 15, the likelihood of closing your escrow by November 30th is near impossible if you are using a loan, so we’ll need to watch pending property counts around October 15th to see if that has any impact on our market.

Here is a snapshot of our market indicators for September:

• 45 homes sold
• Average asking price is $252,187
• Average selling price is $239,017
• Average days on market is 139

The average asking and selling price for Carson Valley Real Estate swung wildly lower in September. Why is that, you ask? Well, of the 45 sales, 11 were bank owned and 9 were short sales. That means 44% of September’s sales were distress sales with distressed values and sales prices. They will drag down the values in the short term. The bright spot in all of this is that the days on market reduced to 139 from last month’s 153.

So what is the absorption rate for the Carson Valley?

• There are 460 homes available for sale in the Carson Valley as of 10/2/09
• 45 homes sold in September
• 460/45 = 10.22 months of inventory

The absorption rate tightened slightly in September, and we attribute that to a handful more sales, and a slightly lower number of homes available for sale. In August, we had 471 homes available for sale and 41 homes sold, giving us an absorption rate of 11.49.

Of the 460 homes on the market, 23 are bank owned and 61 are short sales.That means that 18% of our market is distressed. New bank-owned properties (REO) have been coming on the market and they’ve been selling quickly. The downside is that they sell for low prices, dragging values down in their respective neighborhoods. Most of these bank owned homes have had multiple offers which has created a slight uptick in sales prices over asking prices. This has generated very modest price appreciation in the entry level market (below $200,000). Homes priced above $300,000 are still duking it out with competing properties to get a sale and prices continue to slide in that range as much as 1-1.5% per month. 

With the first time homebuyer credit expiring on November 30, 2009, there’s a big incentive for homebuyers to get out there and buy a home. Will it be extended? I suspect it may, but I’m not holding my breath, and neither should qualified buyers hoping to take advantage of the tax credit.

(Data provided courtesy of the Northern Nevada Regional Multiple Listing Service and excludes manufactured and shared ownership housing for Area 300, known as the Carson Valley and outlying areas. Carson Valley photograph courtesy of ScottSchrantz – Flickr.com)