BOLEN: We’re only talking about seven home sales
Special to the Tribune
SOUTH LAKE TAHOE, Calif. – As soon as I heard the Aug. 25 news about the U.S. decline in July existing home sales, I knew what was coming. That’s why I immediately crunched numbers, looked at the data, and compared the national report to what’s what here in South Lake Tahoe right now.
Regardless of the differences in a national report and current South Lake Tahoe reality, I knew a media barrage was coming, and that it would impact people’s perceptions.
The truth is, a funky national housing report does not necessarily apply to South Lake Tahoe. Sometimes national trends appear here, usually months after the fact, and then again, sometimes they do not. Usually what happens here is a difference in degree (in this case that degree is 9 percent).
We are a second-home resort market. Most real estate markets are not that, many many more than a simple majority. National real estate reports include the country and all of those many, many real estate markets that are not resorts.
That we are a resort, with real environmental growth restrictions that limit supply, is something to remember – it makes sense that trends here can be different.
What people will remember from the Aug. 25 report is that existing U.S. home sales in July are down 27 percent. That’s the headline, the attention getter, the around-the-water-cooler buzz – folks will remember that more than anything else in the report.
So here’s the comparative bottom line as it relates to South Lake Tahoe – we are only talking about seven home sales.
That’s right, and we need to remember it, put perception into perspective. The national report compares July sales of this year to last year – that’s where the 27 percent decline comes from. Here, there were 38 homes sold in July of 2009. This year 31 homes sold. True, this is a decline, an 18 percent percent one – 9 percent better than the national average. As big as an 18 percent decline sounds, we’re only talking about seven home sales. That’s it, seven sales, amid all the hoopla.
Not included in the hoopla is that we’ve sold more than 100 more homes this year than at the same time last year. This is a 48.3 percent increase in South Lake Tahoe home sales, while exactly considering and including yesterday’s media-claimed startling news.
To drive the point home perhaps even more, let’s look at South Lake Tahoe June sales. Last year 40 homes sold; this year 48. So this means there was a 20 percent increase in year-over-year June sales, and if both June and July are added together, right smack-dab in the middle of all of this double-dip talk, one more home has sold in the first two months of this summer compared to last. And a hundred plus more homes have still sold this year, too.
People like to believe what suits them. Sometimes what suits us is right, or true, sometimes not. It’s been like that since man started thinking. It is the nature of things.
When it comes to real estate, either nationally or locally, the public perception may not be real, but it is reality.
The media usually fuels public perception, though in the current national real estate climate, various media sources have differing opinions as to where we are. There are some who say things are better, or worse, than others. The point is, who are you going to believe?
For the last year and a half, at least, there has been much media hue and cry about the shadow inventory – the foreclosure deluge that is sure to come, some have said. We’ve heard and read about it so much that shadow inventory is part of the American lexicon. It’s a buzz word now, and one to be aware and careful of, but the truth is there is no more evidence of it in South Lake Tahoe now than 18 months ago. No new deluge here.
The new term now, sprinting blisteringly past shadow inventory, is double-dip recession. And the national existing housing report a few days ago has certainly given rise to double-dip-talk frenzy (double dip is for ice cream cones, but that’s another story).
Is that shadow inventory actually coming? Will there be a significant return to further recession? Are we already there yet? We don’t know, but we aren’t seeing it yet statistically here in South Lake Tahoe.
– Richard Bolen is a Realtor with McCall Realty who blogs about the local real estate market at http://www.tahoedailytribune.com/bolenrealestateblog.