By Annie Flanzraich
Tahoe Daily Tribune
SOUTH LAKE TAHOE — It’s a buyer’s market out there.
The median price of a South Lake Tahoe home dropped by almost 10 percent since 2010 in the first half of 2011, leaving the market ripe with homes priced at less than $350,000.
“That’s where we’re seeing most of the buyer activity,” said Jim Wire, spokesman for the South Tahoe Association of Realtors and a Chase agent. “But the thing is, even though we are seeing more buying activity (the market is) getting replenished by the foreclosures and short sales.”
From June 2009 to June 2010 there were 568 homes for sale in the South Lake Tahoe MLS area, according to STAR. From June 2010 to June 2011 there were 558 homes for sale on the market.
“We’re still looking at increasingly good news for buyers throughout the first half of the year,” said Richard Bolen, publisher of www.laketahoerealestateblog.com.
Buyers are also in a position to purchase a better house for $350,000 or $300,000 than they could have bought five years ago, Bolen added.
“The issue is getting the buyer to understand that the decline they are looking for is often found in the quality house they are buying — not the price,” he added.
An influx of distressed homes is helping to fuel the market, Bolen and Wire agreed.
Almost half of the homes sold 2011, 51.2 percent, were distressed sales, according to Bolen’s blog. That compares to 46.4 percent in 2010.
“That’s what’s driving the market,” Wire said. “Banks want to see homes sell within a short period of time. To keep those sales at steady pace, they are having to drop those prices to continue to bring more buyers into the market.”
While that price drop affects the price of non-distressed homes on the market, statistics that prove that nondistressed sales get premium prices or higher prices than a foreclosure for a comparable home, Wire said.
“It has to do with condition,” he said.
For sellers, knowledge of the state of the real estate market can help when pricing a home, Bolen said.
“For sellers it means if you want to sell your house you must get ahead of the market,” he said. “You have to price it at current market reality — not what it was a year ago for example and not what it was in 2005.”