Challenges of Selling an Older Home in this Marketplace

This is definitely a challenge and one very close to my heart today having two listing in an area of a large inventory of new or newer homes, “How can I sell my two listings that are both 20+ years old against all this competition? “ Yes, they are in Tahoe Donner, which is one of the most popular areas in the North Lake Tahoe region. It is the first exit off of I-80 to Truckee, has all the amenities that anyone could desire including a downhill and cross country skiing for the winter and a private beach with boat launch and picnic area at Donner Lake in the summer.  This plus equestrian facilities, fine food dining, a sports center, eleven tennis courts, golf, trails for hiking, biking  and many a fun party, Tahoe Donner offers it all.

                         

 In Tahoe Donner there are over 140 homes on the market each month with 7%-10% selling.  So how do you promote your older home listing that is on 1.5 lots, 4000+ sq. feet or has a special view when it is 20+ years old? Most buyers feel it would take $200,000 to upgrade to today’s standards against the new comparable homes where a buyer can move right in and have beautiful wood floors, granite and flagstone for their kitchen counter tops and floors and no additional work needed.  They may have less square footage but have all the necessary rooms which are new.  Most people don’t mind smaller bedrooms when they are active outside people.

 

The answer is simple but difficult for sellers to accept.  The house has to be priced right for the situation.  In today’s market when only 7% – 10% of the properties are being sold, you need to be in that 10%.  In other words, you need to price your house to sell. How? – By being the very best bargain in your price range at that time.

 

Someone will buy the 1 ½ lots or a special private view of an older home if the price makes up for the improvements needed.  Otherwise, the buyers will move on to a smaller house that doesn’t need all the extra TLC.   This is a time when it is even more important to have the right real estate agent. Talk to your professional real estate agent.  Let them do the work for you to get the best price, but to get it “sold”.

Mortgage Rates Hits New Low

Low mortgage rates may be encouraging buyers to step up to purchase.  Two high end areas in Truckee, Lahontan and Old Greenwood have recently had new activity.   Lahontan had two sales last week  with average price of $1.7M and Old Greenwood had one sale at $2.0M.   There are currently three properties in escrow in Old Greenwood.  This is good news as the properties over a million dollars are showing activity.

Realtor.com news shows mortage rate at new low.  This was posted on realtor.com on February 20, 2009.

30-Year Rates Drop to Near 5%
Mortgage rates across the board fell this week, a welcoming sign to potential buyers and home owners looking to refinance.

The 30-year fixed-rate mortgage averaged 5.04 percent this week, a drop from last week’s 5.16 percent. Last year at this time, the 30-year rate averaged 6.04 percent, Freddie Mac reports.

Freddie Mac reported the following for other rates for the week:

• 15-year mortgage rates: averaged 4.68 percent, down from last week’s 4.81 percent. Last year at this time: 5.64 percent.
• 5-year hybrid adjustable-rate mortgages: averaged 5.04 percent this week, a drop from last week’s 5.23 percent. Last year at this time: 5.37 percent
• 1-year ARMs: averaged 4.8 percent, down from last week’s 4.94 percent. Last year at this time: 4.98 percent

“Mortgage rates followed bond yields lower this week as recent economic reports suggest the economy is still slowing, which reduces the future threat of inflation,” says Frank Nothaft, Freddie Mac’s chief economist.

Black Tie and Tails Event a Huge Success

   The first annual gala event for the Humane Society was a huge success.  With all hearts on the wonderful work the humane society does, the Valentine’s Day event fun for the 200 guests and the 50 dog guests.  All the dogs were impressed with themselves and the event brought in $20,000 for the humane society.  You can view the photos at  the picture gallery.

Now is the Time!

With everything happening in our financial world, real estate is still a great investment.  The meltdown of the home market has certainly increased the fear and pressure of what and when to buy, but living in Tahoe, the market will eventually go up.  For those people who had a steady 12% – 15% increase in value per year over the last 7 – 10 years are still ahead of the meltdown.  For those who purchased in the last 2-3 years, you need to buckle down, work harder and plan on at least a five year cycle.  The good news is that it is cyclical, all business goes up and down, so “hang in there”.

Now is the time to Buy.  If you are even thinking about purchasing in Tahoe, this is the time.  Prices are at the lowest that I have seen since moving up here five years ago.  Our offices of Truckee, Tahoe City and Squaw Valley have seen an increase in the number of escrows in the last two months.  Our number of closed escrows has increased over the previous two quarters.   The sale prices are the lowest we have seen.  This is a great time for first time buyers.

Having said this, the activity between $800,000 – $1,300,000 has increased as well.  There have even been multiple offers on properties in this price range.  Properties that are the best value  and priced right for the house are selling.   Some even with multiple offers.

The weather is beautiful, the colors are bursting and there has never been a better time to invest, primary or vacation, this is the time.