I was recently taking a look at the Tahoe Bonanza newspaper here in Incline Village and found an insert from one of the big International real estate firms. This purported biannual report covering Lake Tahoe, Truckee and the High Sierra gave a brief synopsis of the real estate market in each of the geographic regions around the Lake Tahoe / Truckee area. I focused on the statistics for Incline Village and Crystal Bay since that is my area of expertise and was astounded to read the conclusions that were drawn in this report.
I think it's pretty difficult to try and analyze an entire year of statistics for the Incline Village real estate market in one paragraph. But that is exactly what this market comparison attempted to do. When comparing the statistics from 2006 versus 2005 for the entire year one has to first remember that the median price of condos in Incline Village rose by over $100,000 up to $580,000 and the median price of houses remained strong at $1,150,000.
Where the insert lacks credibility is in the incomplete market analysis that is being fostered upon the general public. When people see something in print they generally think that it must be true, especially when being offered up by a reputable real estate firm of international stature. However a closer examination of the facts reveals that the analysis is fraught with holes. The best example relates to the comments made concerning condos in Incline Village and sale prices in 2006 vs. 2005.
In regard to condo sales the article states that, "units sold under $500,000 were down a whopping 65% and units over $500,000 were down 31%". This would make it appear that the low end of the market was very weak and that moderate and higher priced condos (although unit sales have declined versus 2005) were the stronger sector. This is only partly true. With the median price for condos rising from below $500,000 to well above $500,000 during 2006, it is only natural that unit sales below $500,000 would decline significantly. There is simply not as much inventory nor as many transactions under $500,000 taking place due to the overall price appreciation in the Incline Village condo market.
By doing an incomplete market analysis the person who wrote this market comparison is misleading the general public. I would anticipate with the median price of condos currently around $580,000 and showing no signs of declining significantly that looking at unit sales above and below $500,000 and comparing them year to year is a meaningless exercise. Let's just accept that the median price for condos in Incline Village will likely remain well above $500,000 barring economic catastrophe and that the incomplete market analysis provided in this advertising insert is inherently flawed.
A better way to analyze the Incline Village real estate market would take into account the fluctuation in median prices for each property category (condos, PUDs and single family homes) and the number of sales in units in each category. Tracking the moving median average and week to week unit sales will give one a much better picture of trends and prices concerning the homes and condos for sale in Incline Village.
Don Kanare is a real estate agent with Lakeshore Realty located in Incline Village, NV at the northeast corner of Lake Tahoe. Don writes a daily column about the new listings, price changes and general market commentary on Incline Village Real Estate. You can find Don's column on his web site at: http://www.InsideIncline.com
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