Home sales and housing market values continue to slowly climb in South Lake Tahoe as the number of bank-owned properties dwindles and interest rates remain low.
The number of properties in escrow has increased by 21 percent since last year, though the amount of homes on the market is similar to 2012 totals, according to Realtor Robert Stiles.
Realtor Brent Johnson said the rise in South Lake Tahoe home sales was significant.
“This summer was extremely busy,” he said.
At the same time, the median sales price for a single-family home increased $237,500 to $312,000, or about 31 percent in the last 12 months. Stiles said he expects the average price of South Lake Tahoe homes to increase with the rise in housing market values.
“It’s better for home sellers,” he said.
The rise in home sales could be caused by several factors, but Stiles said it’s largely due to a major decline in distressed sales — homes that were bank-owned, foreclosed or short sale.
A year ago, about 50 percent of all home sales in the area were categorized as distressed sales. Now, that number has dropped to 8 percent.
“The banks had so much inventory they were just dumping the market,” he said. “And the prices were just going lower and lower as they ran out of inventory.”
About 205 single-family homes were sold in the area between July 1 and Oct. 1, according to Stiles. In that same time, about four were bank-owned properties and 11 were short sales.
The decrease in distressed sales becomes clear, however, when comparing data from April 2013 to July 2013. During that time, 10 of the 173 homes sold were bank-owned and 18 were short sales.
Low interest rates add to the appeal of purchasing a home, Stiles said.
Due to the Federal Reserve’s controversial quantitative easing policies, $85 billion a month is being shoveled into the economy. The result is low, favorable interest rates among homebuyers, and Stiles suggests taking advantage of them now before the government’s bond-buying strategy ends.
“Now’s a good time for buyers to find a place in South Lake Tahoe,” he said.
Hot spots for home sales in the Lake Tahoe area include Tahoe Keys, Sierra Tract, Bijou and Montgomery Estates, according to Stiles. About 72 homes were sold in the Tahoe Keys area from September 2012 to September 2013. In that same time, 57 were sold in Sierra Tract, 55 were sold in Bijou and 49 were sold at Montgomery Estates.
In terms of value, Gardner Mountain saw the biggest increase at 34 percent from a year ago, while values in the Y area are up about 30 percent from a year ago.
Johnson said sales are tapering off now, but he expects the housing market to continue its recovery, albeit, at a slower pace.
Stiles agreed.
“As long as interest rates stay low, the housing market should continue in a positive direction,” he said.