South County real estate reportedly rebounding
March 4, 2013
After a prolonged period of depressed real estate in all regions of Nevada County, industry experts are reporting an escalation in prices.
"Over the last four months or so, we have seen an increase in values and in the number of houses sold," said Diann Patton, broker and owner of Coldwell Banker Grass Roots Realty. "This trend has taken place throughout most of the county, and South County is no different."
Eric Hatch of Century 21 Foothill Realty said one of the most reliable indicators of market recovery in the South County real estate sector is the slender inventory of low-end houses for sale in Lake of the Pines, which with its 1,900 homes has the highest residential density in South County.
"I've seen a big upward trend (in sales)," Hatch said. "There is not a home (in Lake of the Pines) that is under $200,000, and the inventory is dwindling."
Hatch went so far as to label the current real estate environment a seller's market, saying although prices have not yet reached their 2006 peak, he is seeing many cash investors scoop up properties on the low end of the market.
"There's still some real good buys, but there is no longer any smoking great deals," Hatch said, saying the sales from the Nevada County courthouse steps for absurdly low prices have gone the way of the dinosaur.
The type of house that about two years ago was selling in the $225,000 range in Lake of the Pines recently sold for about $289,000, Hatch said. Recently, a house that was listed at $255,000 in South County received five offers after landing on the market, driving up the price.
In some cases, the practice of "fix and flip" has returned to the market, in which cash investors looking to take advantage of the bottomed-out prices will buy property, invest cash in remodeling, then turn the property around for a profit, Hatch said. Such a property didn't exist during the past five years as investors saw a bloated inventory as a foreboding deterrent to making any substantial cash investment in property.
Hatch said the high end of the market in Lake of the Pines and other South County residential zones has been less active.
However, Patton reported a high-end property listed at about $500,000 in the southern portion of the county received an offer after about two days on the market.
"What's been interesting to see in the last few weeks is people who gave up are putting their houses back on the market," Patton said.
In other words, a property owner who put a house on the market and received offers that fell well short of the anticipated value of the house are trying again.
"They're giving it another shot," she said.
Why South County?
Patton said she does not make sales pitches to prospective customers but prefers to ask a series of questions in a quest to find a perfect fit. However, for individuals who want to be "below the snow and above the fog," South County springs to the forefront of her recommendation list.
South County is also ideally positioned for people who want to commute to Sacramento as it is about a 40-minute drive to California's capital city from the region, Patton said. Furthermore, many clients come to Nevada County in search of relief from the suburban sprawl endemic to many areas of Northern California.
"Some people intend to keep livestock or horses, and that is better suited for lower elevations (of the county)," Patton said.
Despite the pastoral splendor, the favorable commute times and the amenities for equestrians and agriculturalists, several challenges still inhibit the region's prestige. The foremost, Patton said, is the lack of high-speed Internet access. Many people from Silicon Valley express interest in moving to South County until they learn their ability to telecommute could be impaired by spotty Internet coverage.
"Fiber optics is huge for us," she said.
A potential solution is currently being constructed, as Vast Networks — a consortium of rural California-based telephone companies — is installing a fiber-optic cable network throughout the county, according to Mike Stewart, director of marketing for Vast Networks. The extensive network will feature higher speeds and capacities, important redundancy and flexibility that current infrastructure does not allow, Stewart said in a news release.
Real estate industry representatives express excitement at the series of developments slated for South County.
The 80-unit Cascade Crossing, the recent sale of DarkHorse Golf Club, an impending resolution in the Higgins Marketplace lawsuit and the Nevada County Planning Commission's approval of Rincon del Rio all figure to create opportunity for the real estate industry.
"We are so excited for South County," Patton said. "It shows the economic growth needed to sustain the real estate community."
Hatch said development activity will help bolster the local long-suffering construction community, which seems to be rebounding.
"There are some big crews at work right now, and that means a lot of people are able to feed their families," Hatch said.
Hatch also believes the coming developments offer a wealth of options for different income groups with the DarkHorse subdivision appealing to the higher end, Cascade Crossing designed to entice middle-class buyers and Rincon del Rio filling a niche for senior housing.
"It will allow a lot of people to stay in the community," Hatch said, "while providing the county with tax dollars."
To contact Staff Writer Matthew Renda, email email@example.com or call 530-477-4239.