by Cary Sanders
Sales Manager at Coldwell Banker Grass Roots Realty
The gated communities of Lake Wildwood and Lake of the Pines lead the pack, and all areas have experienced substantial home price appreciation.
Last month, I reported in this article that the average sold price for single family homes in Western Nevada County was up an incredible 14% for Q2 2017 over Q2 2016. As promised in that article, I will now articulate how the different areas and price ranges are performing. All the information and analysis below are based on Single Family Homes over the last twelve months (August 2016 – July 2017).
Appreciation Rates by Area: Lake Wildwood, Lake of the Pines, and Nevada City all have home price appreciation rates over an astounding 13%, whereas the average appreciation for Western Nevada County is 9.2% year over year (the last twelve months [LTM] compared to the previous twelve months [PTM]). The South County area is the under-performer here (probably based on its buyer’s market distinction – see below) as it showed a drastically smaller increase of 2.4%.
Note: These are Nevada County Multiple Listing Service (MLS) defined areas. PV = Penn Valley | R&R = Rough and Ready | BOV = Big Oak Valley
Average Sold Price by Area: The highest average home prices are found in the areas of South County ($519k) and Nevada City ($472k), and the lowest average home prices are in the Grass Valley area ($375k). The average sold price for Western Nevada County is $414,000. One caveat: the average sold price in Lake Wildwood and Lake of the Pines are definitely skewed upward by the lakefront homes.
Demand by Price Range: With 482 sold units, the price range of $300k – $399k has the highest demand, and the median sold price in all of Western Nevada County is $370k.
Change in New Listings & Units Sold: The Million Dollar Plus homes saw the biggest percentage jump in sales (83.3% jump to 22 units sold). Six of the eight price ranges showed an increase in sales units. With 1,736 new listings entering the market, supply is still historically low and very close to the previous twelve months (up 0.8%). Take note of the under $400k market as we’ve had significantly less new listings in that price range, and we would have definitely sold more homes if more were available in that high demand price range. Overall, demand remains very high (the highest we’ve seen in 15+ years) with 1,375 sold units, which is up the same 0.8% year over year.
Are we in a buyer’s or seller’s market? We remain deadlocked in a tight seller’s market for everything priced up to $600,000, and that upper limit is moving up as home values continue to appreciate. Note that the price range from $600k to $699k shows an average Months of Inventory (MOI) over the last twelve months of 7.4, but the current snapshot taken at the end of July 2017 shows only 3.4 MOI. Homes above those price ranges have shifted into buyers’ markets. Months of Inventory is a theoretical calculation that shows how long it would take for us to sell all currently available inventory (without new inventory entering the market) based on the current rate of sales. Typically, anything less than six Months of Inventory is considered a seller’s market, and anything over six months is considered a buyers’s market. Note: The blue columns below represent the average MOI over the last twelve months, and the orange columns represent the current MOI (as of July 31, 2017).
Which areas are buyers’ markets, and which are sellers’ markets? I hesitate to even pose this question, as it isn’t the best question to ask: the Months of Inventory calculation based on price range (see above) details a much more informative delineation than by area. That being said, all the MLS areas, except for the South County, have shown an average of less than four Months of Inventory over the last twelve months as well as the current MOI as of July 2017 – placing them in the seller’s market distinction. The South County area shows an average of 5.1 MOI over the last twelve months and currently has an oversupply with 9 MOI – defining it as a buyer’s market.
This analysis of single family homes in Nevada County is based on reports published August 2017, based on data available at the end of July 2017. All reports presented or referenced are based on data supplied by the Nevada County Association of REALTORS® or its MLS. The MLS does not guarantee or is not in anyway responsible for their accuracy. Data maintained by the MLS may not reflect all real estate activities in the market. Information deemed reliable but not guaranteed.