Welcome to the ArrowCreek monthly property value update for a High Desert, Semi-Rural community in Washoe County, Nevada, that happens to contain a PRIVATE Golf Course (A.K.A. the Non-Residential Area as documented in the CC&Rs). Participation in the private golf club is purely optional for all interested parties. The origins of this report were based on a heated discussion of the value of homes on a golf course versus those not on a golf course, which is likely different for some other communities, and, as you’ll observe, the belief that homes on a course are worth more is a ‘belief’ not necessarily based on factual data from Northern Nevada. Our community is financially diverse having been created that way by the designer of the community and Washoe County in 1997. It consists of 506 Semi-Custom homes, typically for middle and upper middle-income individuals, and 577 Custom home sites, typically for upper middle and high net worth individuals, of which 445 custom homes have or are being built. This report contains the data that was available on 31 March from the Washoe County Assessor’s Records as compiled and analyzed by the author.
There were eighteen (18) properties that changed owners over this past month, only four (4) were directly adjoining the ‘golf course’ and those not on the course. With this division, homes ‘on the golf course’ show a 3.8% advantage to those not on the course which amounts to a $12 per square foot advantage. This ‘advantage’ holds up for undeveloped land as the price, as you will read shortly, is 14% higher for property adjoining the golf course.
Since April of 2020 and over the past twelve (12) months:
1. Custom ArrowCreek homes appear to have established a ‘floor’ of $310 per square foot and semi-custom homes a ‘floor’ of $260 per square-foot to grow from. With eighteen fully financed properties changing hands this past month, Monte Sol neighborhood was most active.
On with THE FACTS:
a.) Eighteen (18) properties were recorded sold in ArrowCreek between 26 February and 26 March (per the Washoe County Assessor, who appears to be current in documenting closed sales). This brings the total number of properties transferred over the past rolling year to 116 or 10.7% turnover rate for our community. This remains a low rate that may be attributed to a general satisfaction with living in our gated community, or the higher prices of properties and/or a positive perspective on our amenities and an emphasis on the secure stable environment offered within ArrowCreek. Additionally, we are faced with a rising economy as the spring buying season is obviously here.
b.) Two (2) homes on the golf course (where the property boundaries actually touch the golf course, not just have a ‘view’ of it) were closed during this reporting period. The rolling average selling price for homes on the golf course now stands at $335.28 per square foot. Based upon the statistical rolling average calculation (only 18 homes are in the calculation. This creates a situation where a single sale above or below the average skews the data. Which is what took place this past month.) the price per square foot increased by $12.62 per square foot. The 12-month rolling average sales price increased to $1,487,095.86, again based upon statistical methods. Two additional vacant parcels were sold and the rolling average selling price for undeveloped property on the golf course now stands at $311,547.66 per acre.
c.) Nine (9) homes were sold that are not connected to the golf course. The rolling average selling price for off-course homes increased to $323.14 per square foot, which is up by $10.97 per square foot, based on a sample size of 56 homes. The twelve-month rolling average sales price for non-golf course homes increased to $1,219,309.75. Five (5) vacant lots were sold, making the rolling 12-month average selling price for vacant land, not on the golf course, standing 14% below vacant golf course property at $273,186.96 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. It should be noted that since July of 2020 prices have been steadily increasing across the ArrowCreek market.
2. Spring has arrived and the housing market is very much alive. For those desiring a secure, safe environment to raise a family or have abundant recreational opportunities, ArrowCreek should not be over-looked.
Do keep in mind that everyone’s selling price is based upon his or her own set of circumstances and the above picture/figure is hindsight, not necessarily foresight. From the volume of property transfers during this reporting period it is clear that the demand for a secure property environment has remained constant. 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 with respect to those found in Reno and Sparks. The following chart portrays the trend lines for Custom and Semi-Custom homes within this broader community. It is worth noting that previous charts purported to show excessive price appreciation in both the Reno and Sparks markets. However, when pricing is considered in the same manner as ArrowCreek, new insight is gathered with respect to ‘normalized’ growth. In any event, ArrowCreek custom home prices have remained fairly stable. It can also be observed that Semi-Custom homes in ArrowCreek have maintained a reasonable competitive value position within the Truckee Meadows. However, it’s very clear, using ‘normalized’ values that both the Reno and Sparks markets began increasing at least four months prior to ArrowCreek’s values. You can also see that the Truckee Meadows values have ‘flattened’ out as ArrowCreek has continues to increase.
- For the past month the ArrowCreek rolling averages are:
- Semi-Custom On-Course: $294.41 per Square Foot
- Semi-Custom Off-Course: $303.19 per Square Foot
- Custom On-Course: $351.00 per Square Foot
- Custom Off-Course: $339.85 per Square Foot
- We also received a request from one of our readers for a comparison of the ArrowCreek values with those in D’Andrea (Sparks market), Somersett (Reno market) and Saddlehorn. 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 $343.81 per square foot (Median price $2,450,000). The average days on the market is 77 days. As noted from above, you can see our ArrowCreek comparable Custom homes are selling between $7.19 higher and $3.96 per square foot LOWER. Data for separate ArrowCreek average time on market was not available. Reno homes comparable to ArrowCreek Semi-Custom homes are selling for $272.46 per square foot (Median price $900,000) with a time-on-market of 7 days. Again, ArrowCreek Semi-Custom home averages are $22 per square foot above those in the Reno market. Median prices rose across the Reno market by 20.1% during the comparable past year, as you can see from the chart, while ArrowCreek combined average prices were 7.4% 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 $220.72 per square foot (Median price $824,894) with an average of 14 days on the market. ArrowCreek Semi-Custom home averages are $74 to $82 higher per square foot. Median prices rose across this market by 10.1% during the comparable past year. For the ArrowCreek community, the Semi-Custom homes rose 11.1% over the same time period.
- Saddlehorn – In reviewing the records for this development, the sample size was too small to obtain meaningful information.
Commentary: I was surprised by the number of undeveloped properties that changed owners this past month (7). I was also surprised that when the prices were ‘normalized,’ the increases in value showed a clear trend from July 2020. ArrowCreek homes continue to be in the top two quartiles of Reno and the Semi-Custom homes are in the top quartile of Reno and Sparks. In addition, the data suggests that the ‘private’ golf course (a.k.a. The Non-Residential area of ArrowCreek) has little effect on prices because ArrowCreek homes are selling at roughly 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. In their minds, it may be true; however, in fact, the truth is only a third of the homes and lots 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 that is not an HOA amenity, 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 05, 2021
For previous postings of the ArrowCreek property value updates: click here.