Welcome to the ArrowCreek monthly property value update for our High Desert, Semi-Rural community that happens to contain a PRIVATE Golf Course. Participation in the private golf club is purely optional for all interested parties. The financial diversity within the ArrowCreek community was put in place by the designer of the community and the county in 1997. It consists of 506 semi-custom homes, typically for middle and upper-middle-income families and individuals, and 579 custom home sites, typically for upper middle and high net worth individuals, of which 428 custom homes have or are being built. As an observer can see, we are a very financially diverse community spanning a large area, roughly 25 square miles, below Mount Rose. This report contains the data that was available on 29 March from the Washoe County Assessor’s Records.
The vagaries of the housing market have definitely caught up with the ArrowCreek community. In fact, the number of homes and properties sold/transferred directly impinging on the golf course has decreased over the past year to the point where only 15 homes have changed ownership. Five (5) properties changed owners during this reporting period. This continues a ‘poor’ winter selling season from November now through March. Custom homes on the Golf Course (Non-Residential area) now exhibit a -3.4% premium to Custom homes not on the course. In the meantime, Semi-Custom homes not on the course are -0.2% lower than those abutting the course (But the statistics suggest this is an anomalous condition). This, of course, leads to the question of ‘What are the value propositions for ArrowCreek properties?’ Key ‘take-aways’ of these ‘facts’ are that smaller homes are selling better than larger homes and ArrowCreek owners have the option to join ‘The Club at ArrowCreek’ or not to join – an individual choice of freedom versus other gated communities. Furthermore, it appears that our ‘value proposition’ of being a secure, family oriented community, with excellent schools, is being recognized by the real estate community. Broader marketing should help the entire community with an emphasis on the use of the southeast connector and the construction of a new junior High School just outside our main entrance.
ArrowCreek Home Owner Association (ACHOA) initiatives are underway to enhance sales and values (a most positive step). The initiatives include a Landscape Committee, which is looking into improving the water quality around our parkway to enhance the ‘greening’ of plantings, and a strategic planning initiative, which has yielded a concept that has received rave reviews. These initiatives are intended to enhance and maintain ArrowCreek as a premier people and family oriented community collocated with a private golf club, identified as a Non-Residential area in the governing documents.
Since March of 2019 and over the past twelve (12) months:
1. ArrowCreek properties have stayed in the premium class within Washoe and Douglas Counties. As you read this report, you will see that prices have been trending together since the winter of 2017-2018. This trend indicates that homes in ArrowCreek appear to be settling into a growth pattern beginning in the $290 per square foot region. We have nineteen neighborhoods. With five properties in five neighborhoods changing hands this past month, there wasn’t a “hottest” neighborhood.
On with THE FACTS:
a.) Five (5) properties were recorded sold in ArrowCreek between 15 February and 8 March 2019 (per the Washoe County Assessor, who appears to be current in closed sales). This brings the total number of properties transferred over the past rolling year to 97 or 8.9% turnover rate for our community. So, sales of ArrowCreek properties has declined by 4% over the past three months. The turn-over rate remains a relatively low, still in the single digits, that may be attributed to general satisfaction with living in our gated community and/or a positive perspective on our amenities with an emphasis on the secure stable environment offered within ArrowCreek.
b.) One (1) property on the golf course (where the property boundaries actually touch the golf course, not just have a ‘view’ of it) was closed during this reporting period. The rolling average selling price for homes on the golf course now stands at $295.02 per square foot. This is a decrease of $4.61 per square foot from February’s value, based upon the statistical rolling average calculation. The 12-month rolling average sales price decreased to $1,177,733.33, again based upon statistical methods. The rolling average selling price for undeveloped property on the golf course still stands at $336,234.08 per acre.
c.) Four (4) properties were sold that are not connected to the golf course. The rolling average selling price for off-course homes increased to $284.38 per square foot, which is up by $3.30 per square foot. The twelve-month rolling average sales price for non-golf course homes decreased to $996,248.05. The rolling 12-month average selling price for vacant land, not on the golf course, now stands 92% below vacant golf course property at $175,168.77 per acre.
d.) The figure below shows the value trends over the past twelve months with the vertical scale being the cost per square-foot.
2. Winter is here, the housing market is very soft, and lenders are being very careful about approving mortgages. For those desiring a secure, safe environment to raise a family, ArrowCreek should not be overlooked.
Do keep in mind that everyone’s selling price is based upon his or her own set of circumstances and the above picture is hindsight, not necessarily foresight. From the sheer volume of property transfers during this reporting period it is clear that the demand for a secure property environment is strong. A balanced marketing approach focused on our amenities should go a long way toward creating a better environment for all homeowners and buyers.
Continuing with the Commentary from previous months: the author received queries about semi-custom and custom homes both on and off the golf course and their relative selling prices. The following chart portrays the trend lines for custom and semi-custom homes within our community.
For the past month the averages are:
Semi-Custom On-Course: $266.75 per Square Foot
Semi-Custom Off-Course: $267.25 per Square Foot
Custom On-Course: $309.15 per Square Foot
Custom Off-Course: $319.69 per Square Foot
- We also received a request from one of our readers for comparison of the ArrowCreek values with those in D’Andrea (Sparks market) and Somersett (Reno market). Having obtained the appropriate reports from the real estate community, here is what was learned. (Data extracted from altosresearch.com Chase International)
- Reno market ‘in general’ – Custom homes in Reno are selling, on average, for $286.49 per-square-foot (Median price $1,215,000) with an average of 196 days, or 6.5 months, on the market. As noted above, you can see our ArrowCreek comparable Custom homes are selling $23-$33 per-square-foot higher. Data for separate ArrowCreek average time on market was not available. Reno homes comparable to ArrowCreek Semi-Custom homes are selling for $226.05 per square-foot (Median price $630,000) with a time-on-market of 119 days, or 4.0 months. Again, ArrowCreek Semi-Custom home averages are around $41 higher per-square-foot. Median prices rose across the Reno market by 16.0% during the comparable past year while ArrowCreek combined average prices were 6.2% higher.
- Sparks market ‘in general’ – The top quartile in the Sparks market actually compares with the Semi-Custom homes in ArrowCreek. The median price for these Sparks homes is $191.10 per-square-foot (Median price $579,995) with an average of 97 days on the market, or 3.2 months. ArrowCreek Semi-Custom home averages are around $76 higher per-square-foot. Median prices rose across this market by 8.4% during the comparable past year. For the ArrowCreek community, the Semi-Custom homes increased by 2.2%. However, individually for an ArrowCreek Semi-Custom, not on the golf course, the increase over the past year was 11.5%.
Commentary: ArrowCreek homes are definitely in the top two quartiles of Reno and the Semi-Custom homes are in the top quartile of Sparks. It is very apparent from the data that smaller homes are selling better than larger homes. Also apparent from the data is that the ‘private’ golf course (a.k.a The Non-Residential area) has little effect on prices because ArrowCreek homes are selling at roughly the same level as comparable non-gated community homes in the Truckee Meadows based upon real estate advertising.
Some owners of ArrowCreek believe they reside in a ‘golf community.’ Those words appear to emanate from those who have chosen to belong to the ‘private’ golf club and participate in its many activities. In their minds, it may be true; however, in fact, the truth is only a third of the homes are on the golf course and less than 50% of owners are actually members of ‘the club.’ Yes, we have a private golf club within our gated community, but we also enjoy the freedom to belong or not. The ‘value proposition’ for our unique community should continue to focus on attracting professionals who value security, good schools and recreational opportunities. More people will come to the ArrowCreek ‘experience’ as Nevada businesses gather top talent with competitive salaries.
By Ron Duncan
April 2, 2019
For previous postings of the ArrowCreek property value updates: click here.