Steve Bohler, president Sierra Nevada Association of Realtors, has seen his fair share of boom and bust in the Douglas County housing market over a career that spans more than four decades.
Builder confidence in Douglas County is on the rise, Bohler says — and the number of homes being built in the Carson Valley through July shows local developers are jumping back into the regional market in full force.
Through July 31 of this year, there were 74 new home starts in the Carson Valley part of Douglas County, as well as six duplex units. A year earlier, there were just 13 new housing starts and zero duplex units being built, Bohler says.
Douglas County isn’t booming at quite the level of say, Washoe County, but all signs point to a healthy housing market in the Carson Valley.
“It’s still going up,” says Bohler, who heads Pinion Pines Realty in Wellington. “It’s going to be a healthy market moving forward.
“Builders are getting more confident in the market – last year they were still sitting on the sidelines waiting to see what will happen. Still, it’s not getting crazy.”
According to the U.S. Census Bureau, there were a total of 162 building permits issued for housing in all of Douglas County in 2016. From 2010 through 2016, there were a total of just 317 homes built in the entire county. The county (excluding Lake Tahoe) is on pace over the past six months for development of nearly one-quarter of the total number of homes erected over the past six years.
Despite the whopping 469 percent increase year-over-year in new home starts in the valley over the past 12 months, Douglas County still won’t experience the explosive growth in housing found in large metropolitan areas of the state because it won’t attract the eye – and capital – of large regional and national builders such as Ryder Homes or Lennar, Bohler notes.
Douglas County homebuilders tend to be local contractors who erect a few speculative homes at a time over the course of a building season rather than bankroll development of entire subdivisions. Most of the new housing activity is near downtown Gardnerville on east side of Highway 395, Bohler adds. Most new product is intended for middle-income homebuyers – prices are in the $350,000 to $400,000 range. However, several of the new home starts in the Carson Valley are large custom homes that far exceed that price range.
Resale activity remains brisk. Through July, there were 501 homes sold in the valley region of Douglas County (all sales excluding the Lake Tahoe area). Average sales price was $403,142, and homes were listed for sale an average of 74 days. Last year during the same time frame there were 502 sales with an average sales price of $240,388, and homes were on the market an average of 100 days.
Prices are up, and average sales time is falling. Presently there are 354 houses on the market in the valley region of Douglas County, and of those homes 136 are pending sales. The average asking price is $640,408.
Lower-prices homes are selling much faster than homes above the $500,000 range. The average asking price of all pending properties is $487,844, while the average asking price for all homes still available is $735,585.
Sales activity in the area is expected to slow over the next six months as inventory of homes for middle-income buyers tightens. Much of the remaining inventory for sale is targeted for upper-income buyers.
“There are plenty of buyers everywhere, it’s just a matter of them getting in a price range that they can afford,” Bohler says. “The middle class is still able to buy houses, but they can’t pay $600,000 for them.”
Of the 136 pending home sales, 96 are selling for under $500,000. That’s 70 percent of the entire resale market in the Carson Valley.
“The upper end just isn’t moving that fast,” Bohler says. “People have to get more realistic. Those homes have been on market longer, and that’s what happens when prices get too high.”
Homebuilders are challenged to keep pace with increased demand for new housing because there simply isn’t enough ready lots available in Douglas County – one of the main reasons the county escapes the attention of national homebuilders. It’s the same story in Carson City.
Currently, there are 193 lots listed for sale in the county. Through July, there were 75 land sales for an average price of $167,000. Average time on the market was roughly one year. Although some lots listed for sale include utilities, many need to be improved with well and septic systems.
Still, it’s another area of homebuilding that’s seen a year-over-year uptick. In the same time frame for 2016, there were 57 lots sold at an average sales price of $178,700. Those lots were on the market for roughly 18 months, Bohler says.
