February Real Estate In South Lake Tahoe Review

The inventory of active single family homes for sale in South Lake Tahoe remained relatively low in February. There are now 401 houses listed on the South Lake Tahoe MLS, 298 of the homes are active and 103 of the homes are in escrow. Distress sales are still the most active part of the real estate market in South Lake Tahoe. Out of the 103 houses in escrow, 51 are short sales and 22 are bank owned foreclosures.

There were 23 single family homes that closed escrow in February, down from 29 in February 2009, and also down from 32 in January. The difficulty with getting short sales closed is one of the reasons that the number of houses sold was down in February. There are currently 51 short sales that are in escrow, and only 4 short sales closed escrow last month! Each monthmore short sales go into escrow, and only a few end up closing. In January there were 40 short sales in escrow, and in December 2009 there were 38. With 51 short sales tied up in escrow, the number of closings is going to be negatively affected. As soon as some of the short sales that are in escrow start closing, the number of sold houses should get back on track.

February Statistics for the South Lake Tahoe Real Estate Market

• There were 23 single family homes in South Lake Tahoe that sold in February, down from 32 in January, and down from 29 in February 2009.
• The average sales price of the homes sold was $405,461, up from $348,328 in January, and down from $411,156 in February 2009.
• The Median sales price of the homes sold was $312,500, down from $317,250 in January, and down from $319,000 in February 2009.
• The average price per square foot was $213, up from $209 in January, and down from $231 in February 2009.
• The average days on the market was 176, up from 162 in January, and up from 167 in February 2009.
• The median days on the market was 119, up from 127 in January, and down from 125 in February 2009.
• There were 11 bank owned foreclosures in South Lake Tahoe that sold, there were also 11 foreclosures sold in January, and there were 12 foreclosures that sold in February 2009.
• There were 4 short sales that closed escrow in February, down from 8 sold short sales in January, and up from 1 sold in February 2009.

The percentage of distress sale closings has also continued to increase. In February 65% of the houses sold in South Lake Tahoe were either foreclosures or short sales. This percentage is up from 59% in January.

The foreclosures in South Lake Tahoe that sold in February had a very low average price per square foot of $171. The average sales price for the 11 foreclosures sold was $334,100 and the median sales price was $258,000. The foreclosures had an average days on the market of 79 including the escrow period.

When looking to purchase a foreclosure in South Lake Tahoe, the best advise that I have for home buyers is to act quickly. Most of the foreclosures go into escrow very quickly and have multiple offers in on them. There are many investors and home buyers that are currently in the market looking for deals. There are also many buyers looking to take advantage of the home buyer tax credit  that expires on April 30th. If you see a foreclosure on the South Lake Tahoe MLS that  you are interested in, make sure to call me before it is too late!

South Lake Tahoe Vacation Rental Tax Deductions

Many home buyers in South Lake Tahoe are thinking of renting out their home as a vacation rental in order to offset the cost of ownership. This is a great way for buyers to afford a bigger or more expensive property that may have been out of reach with out any rental income. Although the vacation rental activity is down along with housing prices, there is still potential to attract renters during our peak winter and summer seasons, especialy holidays.

If you do rent out your home in South Lake Tahoe, there are some great tax deductions that you do not want to miss. It is important to ask your CPA about the allowed deductions, but here are deductions that owners of rental properties can take as listed on IRS.gov.

• Mortgage interest
• Property Taxes
• Operating expenses
• Depreciation
• Repairs

You can deduct the ordinary and necessary expenses for managing, conserving, and maintaining your rental property. Ordinary expenses are those that are common and generally accepted in the business. Necessary expenses are those that are deemed appropriate, such as interest, taxes, advertising, maintenance, utilities, snow removal, and insurance.

You can deduct the cost of repairs that you make to your rental property. A repair keeps your property in good operating condition and does not materially add value to the property. Examples are painting, fixing leaks, replacing broken doors and other parts of the rental property.

You may not deduct the cost of improvements. An improvement adds to the value of the property, prolongs its useful life, or adapts it to new uses. The cost of improvements is recovered through depreciation. Examples are adding a deck, a new fence, or a roof.  Your CPA will be able to calculate the depreciation of the improvements so that the cost of the improvement will be deducted over time.

In my mind, the best deduction for a vacation rental property in South Lake Tahoe is travel expense! Many real estate investors acquire real estate in the places they like to visit. Each time they travel to the property, the travel costs are a deductible expense. That means that if you purchase a rental property in South Lake Tahoe, your next visit to your home will be tax deductible!

This blog post was just a highlight of the available tax deductions for rental properties. I am a real estate agent in South Lake Tahoe, not a tax expert, so make sure to check with your CPA for allowable tax deductions and recent tax changes! For more information regarding properties for sale in South Lake Tahoe, contact Brent Johnson today!

Mortgage Rates and the Real Estate Market in South Lake Tahoe

There are many South Lake Tahoe home buyers taking advantage of the currently low mortgage interest rates and the homebuyer tax credit that expires on April 30th. According to an article written by Carolyn Said on SFGATE.com, the currently low mortgage rates will soon be on the rise.

After the credit crunch in 2008 when investors stopped buying mortgage-backed securities the Federal Reserve stepped in to ensure that money would keep flowing to home purchasers. The Fed began buying securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae in January 2009 and had planned to conclude the program at the end of the year. The program that has pumped more than $125 trillion into the mortgage market has been extended to March 31.

Experts agree that the expiration of the Fed’s program will cause interest rates to climb, but the amount of the rate increase is still in question.

According to Guy Cecala, publisher of Inside Mortgage Finance said “There is no question that interest rates have been kept artificially low by the Fed’s buying. My opinion is that rates will go up a full percentage initally.” That means that the current 30-year fixed rate mortgages that are around 5% will go up to 6%.

Keith Gumbinger, vice president of HSH Associates, which compiles mortgage data, thinks that rates will slowly rise to 5.75% when the Fed withdraws.

Julian Hebron, branch manager at RPM Mortgage’s San Fransisco office thinks that rates will bump up to about 5.5% with volatility all summer long.

I am optimistic that the Fed’s will see that if they stop buying mortgage backed securities it will decrease the housing affordability index percentage and make it harder for many home buyers to purchase homes. I would be surprised if the program is not extended again.

The low interest rates and the home buyers tax credit has been great for the South Lake Tahoe real estate market. The numer of homes sold in 2009 was up 22% from 2008 showing that home buyers are out there taking advantage of the current market conditions. For those home buyers that are on the fence about purchasing a home in South Lake Tahoe, now may be the best time before interest rates increase and the tax credit expires!

Make sure to see my current list of foreclosures in South Lake Tahoe that are listed on the South Lake Tahoe mls.

South Lake Tahoe Real Estate Market Update

Here are the latest statistics for the South Lake Tahoe real estate market as of February 11, 2010.

Currently there are 388 single family house listings on the South Lake Tahoe MLS. 300 of the homes are active and 88 are active pending. With 23% of our housing inventory in escrow, the market is continuing to be very active.

Short sales account for 20% of the single family home inventory in South Lake Tahoe. There are 77 short sales listed on the South Lake Tahoe MLS and 43 of them are currently in escrow. Many of the short sales that are currently in escrow have been in escrow for a long time. The median days on the market for the short sales that are in escrow is 170.

Foreclosures account for 12% of the single family home inventory on the South Lake Tahoe MLS. There are 46 foreclosures listed on the South Lake Tahoe MLS and 22 of them are in escrow.

With 43 short sales and 22 foreclosures in escrow, 65 of the houses in escrow are now distress sales. Having 74% of our current escrows being distress sales is not good news for regular sellers. For more information regarding South Lake Tahoe real estate statistics, please call Brent Johnson today!

Bank Owned Properties in South Lake Tahoe

In 2009 foreclosures accounted for 137 of the 440 single family homes sold in South Lake Tahoe. Considering that over 31% of the homes sold were foreclosures, there is no doubt that bank owned properties have changed the South Lake Tahoe Real Estate market.

Looking at the South Lake Tahoe Real Estate statistics for 2009, the foreclosures lowered the median sales price, average sales price, average price per square foot, and the days on the market of the homes sold in 2009.

The median sales price was down 22% in 2009 from what it was in 2008. The median sales price of the homes sold in 2009 was $318,000. The median sales price of the foreclosures sold in 2009 was $274,900. If we take the foreclosures out of the statistics, the median sales price goes up to $366,500.

The average sales price was lowered significantly by the foreclosures in South Lake Tahoe. The average sales price for all of the homes sold was $404,364. The average sales price for the foreclosures was $296,076. Taking the foreclosures out of the statistics brings the average sales price up to $453,826.

The average price per square foot for all of the homes sold in South Lake Tahoe in 2009 including the foreclosures was $230. The average price per square foot of the foreclosures that sold was only $190 per square foot. If you take the foreclosures out of the picture, the average sales price per square foot would have been $248.

The median days on the market for all of the homes sold in 2009 was 114 days. The median days on the market for the foreclosures was 70. The median days on the market goes up to 149 if the foreclosures are taken out of the equation.

Just taking the foreclosures out of the statistics changes the prices dramatically, but if you consider that regular sellers also needed to lower their sales prices to compete with the foreclosures, the effect becomes even greater.

Foreclosure sales occured in almost every area in South Lake Tahoe. Here is a list of how many single family home foreclosure sales there were in each area on the South Lake Tahoe MLS in 2009.

• Al Tahoe had 8 foreclosure sales
• Bijou 1 had 18 foreclosure sales
• Bijou 2 had 3 foreclosure sales
• Black Bart had 3 foreclosure sales
• Christmas Valley 1 had 2 foreclosure sales
• Christmas Valley 2 had 3 foreclosure sales
• Echo View Estates had 1 foreclosure sale
• Country Club Estates had 5 foreclosure sales
• Gardner Mountain had 4 foreclosure sales
• Hevenly Valley had 5 foreclosure sales
• Highland Woods had 5 foreclosure sales
• Meyers had 7 foreclosure sales
• Montgomery Estates had 11 foreclosure sales
• North Upper Truckee 1 had 5 foreclosure sales
• North Upper Truckee 2 had 3 foreclosure sales
• Poineer Trail area had 5 foreclosure sales
• Sierra Tract had 13 foreclosure sales
• Sky Meadows had 1 foreclosure sale
• Stateline had 2 foreclosure sales
• Tahoe Island Drive had 5 foreclosure sales
• Tahoe Island Park had 7 foreclosure sales
• Tahoe Keys had 5 foreclosure sales
• Tahoe Paradise had 10 foreclosure sales
• The Y Area had 6 foreclosure sales

Here is what the foreclosures in South Lake Tahoe sold for by price range.

• Under $100,000= 1 sold foreclosures
• $100,000 to $139,999= 3 sold foreclosures
• $140,000 to $159,999= 6 sold foreclosures
• $160,000 to $179,999= 6 sold foreclosures
• $180,000 to $199,999= 10 sold foreclosures
• $200,000 to $249,999= 27 sold foreclosures
• $250,000 to $299,999= 36 sold foreclosures
• $300,000 to $349,999= 20 sold foreclosures
• $350,000 to $399,999= 9 sold foreclosures
• $400,000 to $449,999= 5 sold foreclosures
• $450,000 to $499,999= 4 sold foreclosures
• $500,000 to $549,999= 1 sold foreclosure
• $550,000 to $599,999= 3 sold foreclosures
• $600,000 to $649,999= 2 sold foreclosures
• $700,000 to $749,999= 1 sold foreclosure
• $750,000 to $799,999= 2 sold foreclosures
• $800,000 to $849,999= 1 sold foreclosure

With the number of foreclosures for sale in South Lake Tahoe  so far in 2010, the South Lake Tahoe real estate market should supply some great deals for home buyers in 2010. For more information on foreclosures in South Lake Tahoe, call South Lake Tahoe Real Estate Agent Brent Johnson today!

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