With half of the year behind us, the real estate market in our area has given us enough data to suggest that our market may be experiencing a shift going forward. Here’s what our local agents are reporting about Incline Village this July.
The busy selling season is typically May-September and with nearly half of that behind us, we can make some impressions of where prices and sales are headed. As of this writing and in the last 7 days, there have been 12 new listings, 15 price reductions, 7 homes that went under contract, and 6 properties sold. For context, the number of new listings is only slightly higher than normal while the number of price reductions is much higher than we typically see. This fact alone seems to suggest that buyers are putting pressure on sellers to reduce their original listing prices by holding off on making an offer or refusing to tour the property.
The entire market of Incline Village and Crystal Bay (homes, condos, lots, and multi units) saw 158 sales with a median price of $1,437,500 in the first two quarters of 2022. If we break these numbers down further, we see that non-lakefront single family home sales have dropped 37% from 121 sales for the first half of the year in 2021 to just 76 within the same time frame for 2022. Not coincidentally, the sales for non-lakefront condos dropped 29% from 101 sales for the first two quarters of 2021 to 72 sales for the same time frame this year. It is interesting to note that there were 4 lakefront homes sold by this point of the year in 2021, while none have sold so far this year. Lakefront condo sales also slipped slightly from 6 sales in 2021 to 4 sales in 2022, a 33% drop. The buyers for these types of properties tend to be high net-worth individuals or families and a dip in sales in this category may suggest an overall shift in how buyers are viewing the market.
Many of our clients have been asking us, “Are we going to see prices drop?”. The answer to that question is complex, however we are seeing a shift to a more balanced market which may involve some overall price reductions. This doesn’t necessarily mean that values are dropping as the median price in most categories has actually increased from last year, despite a significant drop in sales and sales volume. What this means is that buyers and sellers are in a tug-of-war over pricing which is causing properties to stay on the market longer and more price reductions. The prices that were over inflated over the past year will likely have to come back to earth as we settle into a more normal and healthy market. We may continue to see a reduction in sales and median prices, however this is more of a sign of our market stabilizing than forecasting a housing recession. Property in Incline Village and Crystal Bay will always be a smart, long-term investment and we will yet again watch values increase over the next few years once we settle into a more normal and healthy sales market!