Toscana CC 2008 Annual Report
Dear Toscana Resident:
In reviewing pages of real estate news addressing the national and local market, I did not find information sufficient to truly identify our market other than through generalizations. So I returned to my more in-depth data research days and compared a number of competing communities in the desert based on a 6 year real estate istory. This data is collected from the Multiple Listing Service so properties sold not reflected in this service are not included in the stats.
The changes in the real estate market for golf course communities when compared to one another and as a group begins to show consistent patterns and areas where other issues may be in play. Please review the data included with this letter as it should help you have a clearer picture of what has happened in our market over the past few years. Included are the following:
- % of Market Share of Homes for Homes under/over $500,000 and $1Million
- 6 Year History of Homes Sold in Competing Country Clubs
- 6 Year Median Sales Price of Homes sold in Competing Country Clubs
- 6 Year High/Low Price Range of Homes sold in Competing Country Clubs
- 6 Year History of Homes Sold in the High End Golf Course Communities
- 6 Year Median Sales Price of Homes Sold in the High End Golf Course Communities
- 6 Year High/Low Price Range of Homes sold in High End Golf Course Communities
When trying to determine where the desert Real Estate market is in relationship to what we hear on the news, it clearly shows a variance in market regions. For example: statistics say that 72% of the real estate sales in the desert are homes under $500,000 and yet in the immediate desert area, for this year it shows 79.5% That is up 15% from a year ago. Part of this is a result of the REO’s (bank owned properties), short sales and foreclosure properties plus the declining average home values. Back in 2003, homes over $1 million represented 2.1% of all ales in the desert. For 2008, we see that number at 5.7%. Even more interesting is the high end golf course communities where sales have not been consistent for each of the developments. Bighorn sold 57% more homes this year than last. Hideaway, Vintage and Toscana saw a decrease in homes sold. The average sales price in these same communities show that the Reserve and Bighorn has an average sales price higher than any year since 2003 with Vintage, Tradition, Toscana and Hideaway showing declines. Even more interesting is that while the low end of the price range may have seen a drop, all the high end communities continue to sell at the higher prices. This indicates that up until now, the prices have not dropped significantly in these communities and the fluctuation is based on what has sold and the features and benefits the property offers in relationship to other competing properties on that market place. While it would appear that home values in the high end communities have held their own, a drop in price in these communities would be expected as that market catches up with the lower priced home market trend over the past few years.
On review the next level of golf course communities where for the most part the homes are repetitive floor plans, we see the homes on average are back just slightly above the 2004 sales price for the same community. With regard to the number of homes sold in these same communities, all are fairly consistent except for Indian Wells Country Club, Desert Horizons and Indian Ridge. These three communities have experienced a greater decline in home sales and continue to have a higher average sales price which could indicate that they need to see a further drop in price to make them more competitive with the other competing country clubs or something else is happening.
The experts who study the real estate market offer mixed messages about what will happen over the next few ears in the real estate market and it is understandable. Lower interest rates mean little unless the banks begin to process more loans. While there are many buyers interested in purchasing a property in the desert, until consumer confidence increases from this low period and people see signs of improvement, it will be very much a buyer’s market. When the banks begin to loan and the interest rates remain low, this buying power will give people an excellent opportunity to purchase great properties at great prices. For cash buyers who don’t need a loan, this is an excellent time to purchase a home for longer term use. Once the process begins, consumer confidence will increase and real estate sales will increase even more than they have in this past year at the lower end of the price market.
Of the 35 homes currently on the market in Toscana, 14 of these homes are developer spec homes. In reality there are 21 resale homes on the market which represents approximately 6% if the homes. While the showing activity has increased and buyers remain slow to take the next step. Primary reasons have been: holding on to cash, not wanting to sell stocks that have taken a drop and the expectation that prices will drop.
Thank you for taking the time to read this annual report. Please let me know if there is anything you find missing or information you would like included in these quarterly mailings.
Have a very happy and prosperous New Year.
Diane R. Williams
Executive Premier Director/Associate Broker
Windermere Real Estate