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Sq Ft: 4,735
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I’ve heard this a few times recently. Now that the economy is obviously improving, buyers are feeling like they missed the bandwagon. Before I go into details, I’ll start my response to the above question by trying to establish a clear understanding of the actual value of real estate. The value of real estate can be perceived in a few different ways. Namely, replacement cost, and comparable sales data. Replacement cost is fairly easy to nail down, though often is not considered, or is miscalculated. Comparable sales data often creates an artificial meaning of what property is worth. The psychology behind this method of valuation effects certain markets more than others, and these small community and recreation based markets often times take a hit much more than other markets. They can be based on the real estate boom, or bust, which has a dramatic effect. The boom can create a huge amount of artificial inflation, and the bust can cause irrational values and depression. In the past decade, we have seen both in our market. Getting back to the actual value or replacement value of real estate, I’m going to attempt to break it down, though I’m always up for further discussion. As a real estate agent, I must have a clear, or at least a general understanding of costs related to construction and replacement. In fact, it is my duty to my Sellers to have an understanding. Because of that, I interviewed with a reputable local builder prior to writing my article. When we first started to converse, I mentioned that buyers are feeling like there are no more good deals. I have to say, the gentleman I was speaking with chuckled as he started to give me an idea on construction costs. “Do you know how much it costs to drill a 300-foot well?” is where we started. Well, I have an idea, last I checked, by the time a pump, plumbing and case is installed it’s about 40 bucks a foot. I also know that on average, septic systems can run 4 to 5000, landscaping can range from 10 to 30,000, (and beyond) then you have construction costs. Now, there are some huge variables here, just like there are some huge variables in well depths, location, etc. I spoke with several builders, and came up with numbers that range from $100 to $350 per foot. Though I can tell you that for 100/ft you’re not going to build a home similar to what we typically see in the valley floor with comp shingle roof, cedar siding, some tile, maybe some hardwood, and some decent finishes with a few vaulted ceilings. Finishes can make all the difference. HVAC, media, roof, windows and doors, and many other variables and finishes can change that number substantially. I’ll probably get a few phone calls on this, but for the sake of keeping my article short, let’s say $150. To wrap this up, let’s put the price of a building site with a well, septic and landscape at 75k – which is cheap – and let’s construct a 2000 square foot house. Considering I’m only scratching the surface of the costs associated with building, I’d say there are still some good deals out there. Now let’s get those sold, and put Teton Valley back to work!
New and exciting changes to our Teton Valley Community are further proof of an improving economy. New Construction by the City of Victor should help Victor, ID Real Estate improve, after several years of depression. Check out this exciting news and rendering below!
From the city of Victor:
By this time next year you will see a “new” business district on and around Main Street in Victor. A stop light at the intersection of Main Street and Center Street will allow pedestrians to cross the street more safely and facilitate automobile traffic. The sidewalks on Center Street will be reconstructed and beautified with new street lights and paving and these enhancements (known as “streetscape improvements”) will be visual cues that invite residents and visitors alike to stop and spend time in town. The streetscape improvements will extend to Depot Way, where a parking area, pavilion with picnic tables, and public restrooms will be constructed at the historic Depot. Issues with pipes freezing in the winter will be alleviated thanks to a new water main that will have been installed on the south side of West Center Street.
Teton Valley Realty would like to update the community on what’s happening at Huntsman Springs in Teton Valley. Set for 2014, Huntsman Springs has scheduled the following:
Fitness center to open early summer
Groundbreaking on Citywalk – early summer
Groundbreaking on Huntsman Lodge and village – early summer
The fitness center at Huntsman Springs is already underway. The “City Walk” is planned to encompass now vacant space behind the “Park Homes” from Depot Street to Huntsman Springs Blvd, see below image from huntsmansprings.com. The new Huntsman Lodge is an exciting new project to begin Summer ’14. Stay tuned!
Invest in… Land?
It’s no secret, building sites for sale in Teton Valley are not flying off the shelf the past few years. The number of lots sold in Teton Valley between ’06 and ’08 was near 1200… The past 2 years Teton Valley has sold 386 lots.
Stats aside, Teton Valley’s real estate market is rebounding quickly, and that’s no secret either. Driggs and Victor homes for sale under 200k are virtually non-existent, and the higher end developments such as Teton Springs and Huntsman Springs are seeing a definite increase as well. There are still some great investment opportunities though, they just may come in the form of raw land, building sites, and commercial sites. Here are some ideas:
Teton Springs residential “Mountain Meadows” lots – there are still a few left. Starting at 29k with a reasonable hoa of about 1200/year, these are great mid-long term investments.
There are some great commercial opportunities in Driggs in Victor, including some great bank owned opportunities under 100k.
Driggs Fly-in parkway (airport) has some great hangar & hangar lot opportunities for great prices.
Other miscellaneous subdivisions in Teton Valley start in the high teens and low 20′s, some of them without HOA dues. These deals WILL begin to become realized, don’t miss your opportunity, contact a Teton Valley Realty agent today!
Huntsman Springs Teton Valley Update: Teton Valley Realty now holds the largest number of private listings in Huntsman Springs, and we can help with all Huntsman Springs Real Estate. See description of the golf resort below, and feel free to inquire with an agent for more information!
Huntsman Springs is a luxury golf community in the shadows of the Tetons, located in the heart of Driggs, ID. During it’s construction, Huntsman’s project was one of the largest movements of land in the region, transforming the wetland to a world-class golf course with over 10,000 sf of greens, 150 bunkers, and acres of Kentucky bluegrass & water features. The completed portion of the project features well over 150 unique homesites & several high traffic, quality commercial lots with close proximity to the County Courthouse & downtown Driggs. Apart from gold, on-site recreation includes fly fishing, hiking & nature walks over Huntsman’s world record boardwalk, elevated over the acres of the project’s nature preserve and wetlands. Let Teton Valley Realty’s professional team open the door to this high mountain paradise.
Teton Valley & Jackson Hole continue to be a Buyer’s Marketplace, but how long will that trend continue?
Teton Valley Homes for Sale – Today vs. ’12:
Let’s focus on Teton Valley Residential under 200k. This market will be (and has been) the first to recover.Current number of residential properties under 200k: 54
Sales <200k (2013 Driggs, Victor, Tetonia, Alta & Surrounding): 112
Sales <200k (2013 Driggs, Victor, Tetonia, Alta & Surrounding): 134
Inventory (2012) 112 (decrease approx. 50% from 1 year ago)
200 to 500k? Increase since ’12: 25% increase in sales
500k+ is a similar story from 1 year ago, with an increase of 10%.
We all have a sense of urgency now that rates have begun to rise. Though it’s not much yet, government bond buying is reducing, and with the National economy improving, it’s just the right ingredients for a more meaningful increase, soon.
New Construction Cost:
Excluding manufactured homes, Condos, and Investment properties, that leaves only a handful of properties for sale in Driggs, Victor & Tetonia. The next step of Teton Valley’s local economy to improve is new construction & spec homes for sale. We have already began to see investors buying up lots & subdivisions, mostly small lots in Driggs & Victor. Great Deals on lots in Teton Valley are good news for new home prices, but the cost of construction still exceeds the cost of a home, currently. When the spec home building begins, home prices MUST increase to cover the cost of construction (hey, there has to be a profit too).
Foreclosures in Teton Valley are at an all-time low (since the downturn of ’08-’09) New notices of default are almost non-existent.
What it all means:
Keep your eye on the market. If your thinking about a new home purchase, it’s time to get serious. Inventory is low. Foreclosures in Driggs are few and far, and Victor is not far behind. Rising home prices are inevitable, and Teton Valley is no exception!
Understanding the real estate market can be complex and intimidating. When you are looking for your new home or a great investment property, the more you understand about the real estate market and how it affects the local area you are looking to buy in, the better prepared you will be to choose the perfect location or investment opportunity. Currently in real estate, it is important to look for places that offer you an investment opportunity. The Teton Valley and the Driggs Real Estate Market offer great opportunities. Here is what you should know about the future of real estate in the Driggs area:
· Property prices in Driggs continue to be low. It is important as a real estate investor to choose areas where you can still acquire property for a reasonable investment. In Driggs prices continue to be low and have not seen the dramatic rise that is being seen in other tourist and vacation areas.
· Interest rates are still low. Because interest rates are still at record low rates, you can often get more land or property for the same investment amount. Don’t risk having the interest rate affect the amount of property you can buy; look and buy now before rates begin to rise.
· The population of the Teton Valley has started to grow. This means that now is a good time to make an investment in the Driggs area. Whether you are looking to purchase land as an investment that you can sell later, or looking for the perfect business opportunity, as Driggs continues to grow in population the return on investment will continue to increase. By investing now while prices are still low you will see a higher return than those who wait to invest later.
· Some important areas to consider in the Driggs real estate market include housing as well as business. With more and more people turning to the Teton Valley as a vacation alternative to nearby Jackson Hole, Driggs will continue to grow as a destination location. Investing in rental property as well as business opportunities will ensure that you are available firsthand to reap the rewards of those investments as the population and the attraction to Driggs increases.
· Driggs continues to increase public services. Not only does the area boast several safety and law enforcement agencies, they also have a hospital, fire protection and ambulance district, as well as an increase in local schools and other opportunities. These services help to increase the market and attraction of the Driggs area and help to increase the investment potential.
The Driggs real estate market has a great future. With more and more interest being generated by the Teton Valley area and more visitors coming every year, it is only a matter of time before Driggs becomes the next vacation destination. The real estate opportunities available now are immense. With prices and interest rates both still low, now is the time to consider investing in property, real estate, and business opportunities in Driggs, Idaho.
One of the most important factors in purchasing a new home or property is understanding your financial readiness. With interest rates still at lower levels then have been seen in decades, it’s an important time to look at the possibilities of buying your first home, or purchasing a vacation home in a dream location. Teton Valley Idaho offers great investment opportunities, and the interest rates for the area continue to be low. Consider these factors and how interest rates for Teton Valley can affect your new purchase:
· There are different types of interest rates. It is important to understand each type of interest rate as it can affect how much you will be paying over time, as well as what your initial investment amount can be. The two primary types of interest are fixed and adjustable rates. A fixed rate is set at a specific amount throughout the length of the loan. An adjustable rate has the potential of changing each year. In times of lower interest these rates can be enticing because the rates are much lower than fixed rates however they do have the potential of rising substantially throughout the term of the loan. Base your decision between adjustable and fixed on how fixed you need your payment to be as well as how stable the interest rate is suspected to be.
· When you are making the purchase of a new home, lot of land, or vacation property understanding interest can help you determine how much you can really afford to spend. When you receive a pre-qualification from a lender they are giving you a total amount you can borrow. Your lender can help you understand how these amounts are determined and how interest is calculated into the totals. For instance when understanding financing amounts, payments are often figured in P&I meaning principle and interest. Interest is added on top of the loan amount. To best determine exactly what your home or property buying potential is, have your lender work with you based on total monthly payments including interest amounts.
· How interest can vary in different areas and at different times. Interest is not a set commodity. It fluctuates daily and sometimes even hourly based on a variety of calculations include the stock market exchange, government lending rates, adjustable factors such as return on investment in specific areas and more. This is why for many home buyers, you begin watching the interest rate at the same time that you begin viewing properties. When you find a low rate you can lock your rate for a period of time. Interest rates can also be different in different areas of the country based on local conditions and investment opportunities.
For the Teton Valley, continued low interest rates continue to draw new buyers to the area. Right now the selection is at an all time high, prices still remain low, and ideal interest conditions have poised this as the perfect time to buy. If you are looking for a great investment opportunity for a new home or vacation property, take the time to look at the Teton Valley and see the many opportunities that await you.