Real Estate: After the Boom

Community Comments

Weathering the Storm

This much we know.

    The mad-crazy-overheated real estate market of the past few years has petered out. Home prices are stagnant at best or in freefall at worst. By the end of 2006 in our region median prices had fallen 13.5 percent year-over-year in Yolo County, and more than 11 percent in Sutter and Nevada counties, according to Dataquick.
    Drive down any residential street, and a profusion of For Sale signs sprouts like untended weeds … and even with falling prices and Price Reduction tags tacked on to the hanging arms every few days, houses are just not selling.
    And prices aren’t the only things falling. The plethora of willing and able buyers has become exceedingly scarce. At the end of 2006, local counties led the state in sales declines: Total home sales in Yuba County were down more than 50 percent year-over-year, Amador was down 46 percent, and Sacramento County, the largest area in the region, dropped by 35 percent.  
    So what does a person do to sell a home in this market, or conversely, to take advantage of the situation and buy one?
    With all the publicity about “green” energy opportunities and with the spate of rebate programs, Prosper wonders if adding sustainable features to an existing house makes a difference in how well it holds its value. Do those features make it more attractive in a sluggish market? Here’s the juice, read “The Green Gap” on page 46 to find out the sobering news, and take a look at our “Home Green Home” chart on pages 48-49 to see the cost/benefit for various energy upgrades.     
    On the other hand, in “Roseville Renewables” on page 47 you’ll find out why that community is the local center of “green energy” building for new homes because of a unique program from Roseville Electric. The program ups the rebates available from the state and feds so builders can upgrade the energy features they offer and pass them on to buyers at an aggressive price.
    Unfortunately, the reality is that for all the best efforts of home owners who carefully recycle their bottles and cans and install tankless water heaters, these “green” investments make but a blip of difference in the energy consumption of California. Take a look at our “Good Intentions” chart of energy consumption on page 47 — read it and weep. Commercial and industrial consumption accounts for nearly two-thirds of our state’s annual energy bill, and there are woefully few incentives for businesses to do anything on energy conservation yet.
    According to Iris Andre, managing director of CBRE’s regional commercial brokerage, “green” issues are “a non-starter.” Except for a handful of politically correct corporations trying to do the right thing no matter the cost, she claims that energy-saving enhancements “play no role in leasing decisions.” One might conclude that it would be smarter and have higher impact for our policymakers to change their emphasis from  solar rooftops to corporate conservationists.
    But enough policy wonkism. Maybe you’re indifferent to real estate market gyrations, in the enviable position to profit from fun … and ready to buy that second home you’ve been eyeing. In “Northstar Rising” on page 50 we take a pictorial look at the newly renovated Village at Northstar, the most family friendly of the major Tahoe resorts, where there are many new condo and home options.
    Finally, if you are thinking of buying a ski condo this year, in “Ski In, Buy In” on page 54 we assess the realty market in that region as well as compare the major Tahoe resorts to give you an idea of the character of each and what you’ll get for your money.

    Good luck.

Read the rest of Prosper's special real estate package, including:

The Green Gap, Roseville Renewables, Northstar Rising and Ski In, Buy In

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