Reno-Sparks Market Report February 25, 2021

February 2021 Market Report

** Data in this report reflect market activity from JANUARY 2021 compared to the previous month and year.  Information is gathered from the Reno-Sparks Association of Realtors® (RSAR) for the Greater Reno-Sparks region via Northern Nevada Regional Multiple Listing Service (www.nnrmls.com).  Data accounts for single-family resale residences only, and excludes townhouses/condos, manufactured/modular and new construction.

  • In the Reno-Sparks market, the Median Sales Price has been lingering near $450K for the last several months.  But don’t let that statistic fool you.  Remember, the median sales price represents the very middle of a data set, with exactly half of the houses priced for less and half priced for more.  A higher number of homes sold in one end of the data set can make it appear that the market is cooling, but other aspects of the market say otherwise.

  • With only 370 single family homes selling in Reno AND Sparks during Jan 2021, the “non-movement” of the median sales price could largely be a factor of more homes selling in the lower price-range.  As seen in the chart below, the circled portion (homes under $500k) represents 62% of the sold inventory in January 2021. This explains why we did not see an increase this month in the Median Sales Price.

  • The graph above represents the distribution of sold properties by price-point.  62% of the units sold were under $500k.  This distribution of sold properties is a large reason why the Median Sales Price is still hovering around $450k.

  • Overall, the Average Sold Price per Square Foot has leaped again, up 18.4% compared to the beginning of 2020, and has inched up .6% month-over-month.  This average represents properties sold over ALL price ranges.

  • Refer to the chart above for a breakdown of the Average Sold Price per Square Foot by Price Range,

  • You’ve been hearing about our region’s housing shortage, right?  The graph above illustrates what has been happening with the rate and supply of sales in Reno and Sparks over the last year.  The Months Supply of Inventory is  down a staggering 73% compared to January 2020.  It held steady at 2 weeks of supply over all price points. MSI absorption rate represents the time it would take to completely “sell out” of the Reno-Sparks inventory at the current rate of sale if no new listings were added to the market.  A balanced market is around 5-6 months of supply, therefore, we are still very much in a “Seller’s Market.”

  • Once again, the Absorption Rate across all all price-points is well-below a balanced market.  The rate of sales in the high end luxury market over $1.5M is 2.6 months supply, also quick-moving in today’s fast-moving real estate market.  In the past, several years, the high-end market would typically over 7 months supply.

  • Single family residential properties are going into contract even more rapidly than the already hot market we have been experiencing over the last several months.  Since the pandemic began truly shaking the wold, the real estate market has been fast-moving.  In January 2021, it took only an average of 26 days to receive an accepted offer.  This accounts for ALL price points in the Reno-Sparks market and is 61% quicker than January 2020.

  • The Average Days to Contract for homes priced under $600k was only 18 days.  The $1-1.5M price range saw homes on the market for an average of 116 days before going into contract.  Perhaps initial overpricing played a part in this particular set of homes?

  • The market saw 20% fewer contracts in January 2021 compared to January 2020, yet rose 10% from the previous month.  This is the time of the year when we start seeing a turn upwards in general activity.
  • As seen in the last two graphs, the count for New Listings has been a near mirror of the New Contracts count.  January 2021 saw 22% more new listings year-over-year and 19% more New Listings month-over-month.

SUMMARY:

  • These days, when “dialed-in” and “move-in-ready” homes come to market, they are often snatched up in about 1 to 3 days, with back-to-back showing appointments during those only days on the market.  Multiple competing offers flood the inboxes of listing agents, allowing Sellers to capitalize on the hot market, and resulting in the highest possible net to those Sellers.
  • While the average 30-year fixed rate mortgage was sub-3% in January, as of February 24, 2021, Bankrate.com reports, “The average rate for a 30-year fixed-rate mortgage is 3.13 percent, an increase of 19 basis points over the last week.” Though on the surface, this appears to be bad news, 3.13% is still very low.  In addition, BusinessInsider.com projects, “As the US continues to face the economic fallout of the COVID-19 pandemic, mortgage rates will likely stay low. ”  This is good news for buyers who are struggling to get their offers accepted today in this fiercely competitive market.  Buyers need all the help they can get right now, and more inventory in the spring months would help too.
  • The market is absorbing new listings at an extremely fast rate, with only an average 2-weeks supply of inventory in Jan 2021.
  • The Median Sales Price, the mid sales-point for sold homes of all price-ranges, is 10% higher than last year.
  • The Average Sold Price per Square Foot continues to steadily rise and is now $261/square feet in Reno-Sparks.
  • Single-family residences continue to move very quickly at an average of 26 days from listing to contract, 61% faster than this same month last year.
  • Today’s fast paced sales beg for Realtors who think on their feet and have the experience and skills to handle the demands of this hot market.  Buyers and Sellers benefit from choosing a professional to handle every detail to navigate them through a successful purchase or sale.  If you need me, I’m there. Email direct dhallerbach@intero.com or reach me by cell at 775-233-0682.  Thank you, ~Denise Hallerbach, Broker-Owner, INTERO Reno
In-The-Know Real Estate Blog January 30, 2021

What Happens When Homeowners Leave Their Forbearance Plans?

According to the latest report from Black Knight, Inc., a well-respected provider of data and analytics for mortgage companies, 6.48 million households have entered a forbearance plan as a result of financial concerns brought on by the COVID-19 pandemic. Here’s where these homeowners stand right now:

  • 2,543,000 (39%) are current on their payments and have left the program
  • 625,000 (9%) have paid off their mortgages
  • 434,000 (7%) have negotiated a repayment plan and have left the program
  • 2,254,000 (35%) have extended their original forbearance plan
  • 512,000 (8%) are still in their original forbearance plan
  • 116,000 (2%) have left the program and are still behind on payments

This shows that of the almost 3.72 million homeowners who have left the program, only 116,000 (2%) exited while they were still behind on their payments. There are still 2.77 million borrowers in a forbearance program. No one knows for sure how many of those will become foreclosures. There are, however, three major reasons why most experts believe there will not be a tsunami of foreclosures as we saw during the housing crash over a decade ago:

  1. Almost 30% of borrowers in forbearance are still current on their mortgage payments.
  2. Banks likely don’t want to repeat the mistakes of 2008-2012 when they put large numbers of foreclosures on their books. This time, many will instead negotiate a modification plan with the borrower, which will enable households to maintain ownership of the home.
  3. With the significant equity homeowners have today, many will be able to sell instead of going into foreclosure.

Will there be foreclosures coming to the market? Yes. There are hundreds of thousands of foreclosures in this country each year. People experience economic hardships, and in some cases, are not able to meet their mortgage obligations.

Here’s the breakdown of new foreclosures over the last three years, prior to the pandemic:

  • 2017: 314,220
  • 2018: 279,040
  • 2019: 277,520

Through the first three quarters of 2020 (the latest data available), there were only 114,780 new foreclosures. If 10% of those currently in forbearance go to foreclosure, 275,000 foreclosures would be added to the market in 2021. That would be an average year as the numbers above show.

What happens if the number is more than 10%?

If we do experience a higher foreclosure rate from those in forbearance, most experts believe the current housing market will easily absorb the excess inventory. We entered 2020 with 1,210,000 single-family homes available for purchase. At the time, that was low and problematic. The market was experiencing high buyer demand, and we needed more houses to meet that demand. We’re now entering 2021 with 320,000 fewer homes for sale, while buyer demand remains extremely strong. This means the housing market has the capacity to soak up a lot of inventory.

Bottom Line

There will be more foreclosures entering the market later this year, especially compared to the record-low numbers in 2020. However, the market will be able to handle the increase as buyer demand remains strong.

In-The-Know Real Estate Blog January 15, 2021

Will Forbearance Plans Lead to a Tsunami of Foreclosures?

At the onset of the economic disruptions caused by the COVID pandemic, the government quickly put into place forbearance plans to allow homeowners to remain in their homes without making their monthly mortgage payments. Today, almost three million households are actively in a forbearance plan. Though 29.4% of those in forbearance have continued to stay current on their payments, many have not.

Yanling Mayer, Principal Economist at CoreLogic, recently revealed:

“A distributional analysis of forborne loans’ payment status reveals that more than one third (39.1%) of all forborne loans are now 150+ days behind payment, while as many as 1-in-4 (25.5%) are 180+ days past due.”

These homeowners have been given permission to not make their payments, but the question now is: how many of them will be able to catch up after their forbearance program ends? There’s speculation that a forthcoming wave of foreclosures could be the result, and that could lead to another crash in home values like we saw a decade ago.

However, today’s situation is different than the 2006-2008 housing crisis as many homeowners have tremendous amounts of equity in their homes.

What are the experts saying?

Over the last 30 days, several industry experts have weighed in on this subject.

Michael Sklarz, President at Collateral Analytics:

“We may very well see a meaningful increase in the number of homes listed for sale as these borrowers choose to sell at what is arguably an intermediate top in the market and downsize to more affordable homes rather than face foreclosure.”

Odeta Kushi, Deputy Chief Economist at First American:

“The foreclosure process is based on two steps. First, the homeowner suffers an adverse economic shock…leading to the homeowner becoming delinquent on their mortgage. However, delinquency by itself is not enough to send a mortgage into foreclosure. With enough equity, a homeowner has the option of selling their home, or tapping into their equity through a refinance, to help weather the economic shock. It is a lack of sufficient equity, the second component of the dual trigger, that causes a serious delinquency to become a foreclosure.”

Don Layton, Senior Industry Fellow at the Joint Center for Housing Studies of Harvard University:

“With a greater cushion of equity, troubled homeowners have dramatically improved options: a greater ability to access funding (e.g. home equity lines) to keep paying monthly expenses until family finances might recover, improved ability to qualify for and support a loan modification, and, if push comes to shove, the ability to sell the home and monetize their increased net worth while reducing monthly payment obligations. So, what should lenders and servicers expect: a large number of foreclosures or only a modest increase? I believe the latter.”

With today’s positive equity situation, many homeowners will be able to use a loan modification or refinance to stay in their homes. If not, some will go to foreclosure, but most will be able to sell and walk away with their equity.

Won’t the additional homes on the market impact prices?

Distressed properties (foreclosures and short sales) sell at a significant discount. If homeowners sell instead of going into foreclosure, the impact on the housing market will be much less severe.

We must also realize there is currently an unprecedented lack of inventory on the market. Just last week, realtor.com explained:

“Nationally, the number of homes for sale was down 39.6%, amounting to 449,000 fewer homes for sale than last December.” 

The Months Supply of Inventory in Reno-Sparks was 74% lower in December 2020 compared to December 2019.  It’s important to remember that there is a sever shortage of homes for sale in the last several months, and inventory remains extremely low.

Nationally, the market has the potential to absorb half a million homes this year without it causing home values to depreciate.

Bottom Line

The pandemic has led to both personal and economic hardships for many American households. The overall residential real estate market, however, has weathered the storm and will continue to do so in 2021.

Reno-Sparks Market Report November 17, 2020

November 2020 Market Report

** Data in this report reflect market activity from OCTOBER 2020 compared to the previous month and year.  Information is gathered from the Reno-Sparks Association of Realtors® (RSAR) for the Greater Reno-Sparks region via Northern Nevada Regional Multiple Listing Service (www.nnrmls.com).  Data accounts for single-family resale residences only, and excludes townhouses/condos, manufactured/modular and new construction.

  • Median Sales Price, at $455,000 for single-family re-sale properties in Reno and Sparks jumped up again 3.4% month-over-month, and is 13.8% higher than October 2019.

  • The Average Sold Price per Square Foot held fairly steady month-over-month at $250/square foot.  This average represents properties sold over ALL price ranges.  For a breakdown of the Average Sold Price per Square Foot, refer to the chart below.  The October 2020 Average Sold Price per Square Foot is 11.7% greater than October 2019.

  • Homes that sold in October 2020 under $600,000 averaged around $235/square foot.  While the upper price ranges pulled in bigger numbers at $312/square foot for the $1M to $1.5 M range, and $414/square foot for homes that sold over $1.5M.

  • The # of Units Sold in September dropped 11.5% month-over-month from 680 to 6169.5% more properties sold in October this year compared to October 2019.  The inventory that sold in October most likely went into contract in September.

  • As seen in the graph above, much like the activity the previous month, the bulk of homes that closed escrow in October 2020 sold between $300k & $500K.  These sales accounted for 55% of the total market share.

  • The Absorption Rate in Reno/Sparks continues to plummet to only 0.6 Months Supply of Inventory. a significant 71% drop year-over-year and a 17% decrease month-over-month.  MSI absorption rate represents the time it would take to “sell out” of the Reno-Sparks inventory at the current rate of sale if no new listings were added to the market.  A balanced market is around 5-6 months of supply, therefore, we continue to experience a major “seller’s market.”

  • The Absorption Rate across all all price-points is well-below a balanced market.  Even high-end, luxury  properties priced over $1.5M saw only 2.3 months supply of inventory during October 2020.

  • Properties continue to spend a very short period of time on-market before going under contract.  Over all price-points, the average days from listing to accepted offer in October 2020 was 34 days.  Properties are moving 41% more quickly into contract than October 2019. 

  • In October 2020, the fastest moving properties were those priced between $300k and $500K, spending an average of only 18.5 days on market.

  • The # of New Contracts over the last several months has held fairly steady.  During the month of October 2020 we saw 21% more new contracts compared to October 2019.  No significant change was noted in the # of New Contracts month-over-month.  

  • The # of New Listings to come to market during October 2020 dropped another 8.5% month-over-month, while increasing 11.5% compared to October 2019.

SUMMARY:

  • While the weather in Northern Nevada has cooled, the real estate market has most certainly NOT!  Inventory remains staggeringly low at 0.6 month supply of inventory and indicates continued high buyer-demand and a rapid rate of sale.
  • Low inventory and high buyer demand continue to place heavy upward pressure on prices, as seen in another jump in the Median Sales price.  At $455,000, the Median Sales Price is 3.4% higher month-over-month and 13.5% greater year-over-year.
  • The Average Sold Price per Square Foot is 11.7% higher than October 2019.
  • Average days from List-To-Contract remains low at 34 days.
  • The # of New Contracts in October 2020 held steady month-over-month.  The New Contract count in October was 21% higher than the same time last year.
  • If you are considering selling your home to upsize, downsize or relocate, I am here to assist you with experienced, professional services to make your transition as smooth as possible.  Email direct dhallerbach@intero.com or reach me by cell at 775-233-0682.  I am so happy to help!
  • Buying a home in Northern Nevada?  Whether it’s your first home, second or third, vacation home or investment property, I have the knowledge and highest level of skill to navigate you through the process.  Call me at 775-233-0682.
Reno-Sparks Market Report October 15, 2020

October 2020 Market Report

** Data in this report reflect market activity from SEPTEMBER 2020 compared to the previous month and year.  Information is gathered from the Reno-Sparks Association of Realtors® (RSAR) for the Greater Reno-Sparks region via Northern Nevada Regional Multiple Listing Service (www.nnrmls.com).  Data accounts for single-family resale residences only, and excludes townhouses/condos, manufactured/modular and new construction.

  • Median Sales Price, at $440,000 for single-family re-sale properties in Reno and Sparks held steady in September 2020, posting a mere 1% dip compared to August 2020, and has shown an increase of 11% year-over-year. 

  • The Average Sold Price per Square Foot continues its upward trend we have been experiencing over the last several months.  Single-family residences sold in Reno-Sparks in September 2020 sold for an average of $249/sqft, a 5% increase month-over-month and an 10% increase year-over-year.

  • Though the Average Sold Price per Square Foot is $249/sqft, once again, homes that sold in September 2020 for over $750k appear to be pulling this average upward.  Homes that sold between $1M and $1.5M averaged $327/sqft, and homes that sold for over $1.5M averaged $439/sqft!

  • The # of Units Sold in September ticked up 4% month-over-month from 644 to 680.  The # of Units Sold is 12% higher than this same time last year.  Please note that homes closing in September likely went into contract in August 2020, accounting for a typical 30-day escrow.

  • As seen in the graph above, the bulk of homes that closed escrow in September 2020 sold between $300k & $500K.  These sales accounted for 60% of the total market share.

  • September’s Absorption Rate continued its downward trajectory and is at a new low of 0.7 Months Supply of Inventory. a staggering 71% drop year-over-year and a 25% decrease month-over-month.  MSI absorption rate represents the time it would take to “sell out” of the Reno-Sparks inventory at the current rate of sale if no new listings were added to the market.  A balanced market is around 5-6 months of supply, therefore, this is a profoundly “seller’s market.”

  • As just mentioned, a “Balanced Market” sees about 5-6 months of inventory.  Even the high-end luxury market is realizing only 3.5 Months Supply of Inventory, and is very much a “Seller’s Market” as well, while the $300k-$500k inventory is less than 1/2 a month of supply!

  • The # of Days from Listing to Contract since the COVID 19 economic shut-down in March has averaged 36 days.  In September 2020 the overall average Days to Contract followed this trend.  Single family residences are taking about 30% less time to receive and acceptable offer this year than in September 2019.  These averages account for all price ranges.

  • While homes priced $300k-$400k received an accepted offer an average of only 16 days from listing, the upper price points of $$1M+ did take an average of a few months to accept an offer.

  • Over the last 4 months, the # of New Contracts has lingered around 720 per month.  During the month of September 2020 we saw 34% more new contracts than the same month last year and 8% fewer new contracts than the previous month.

  • The # of New Listings to hit the market dropped 8% month-over-month, while decreasing 10% compared to September 2019.

SUMMARY:

  • So why are folks moving to Northern Nevada?  They have recently found that they can work from anywhere… They are moving here for the jobs that are being created here… Their companies are moving them here.  They are purchasing their retirement homes (both ahead of and after their retirement date)… They loathe the tax burdens of our neighboring state… They are threatened by wildfires and/or have devastatingly lost their home because of them.  Pick your reason… the mass influx of new Northern Nevadans is real.
  • While the Median Sale Price in Reno-Sparks is holding steady, so too are low interest rates.  Sub-3% interest rates for many qualified buyers may be keeping those buyers in the market.
  • The combination of historically low 0.7 Months Supply of Inventory and high buyer demand continue to add fuel to the very hot residential real estate market today.
  • The Average Sold Price per Square Foot continues is upward trend, and appears to be driven by the high-end luxury market.
  • Average days from listing to contract remains low at 36 days.
  • The # of New Contracts in September 2020 continue to rise.
  • If you are considering selling your home to upsize, downsize or relocate, I am here to assist you with experienced, professional services to make your transition as smooth as possible.  Email direct dhallerbach@intero.com or reach me by cell at 775-233-0682.  I am so happy to help!
  • Buying a home in Northern Nevada?  Whether it’s your first home, second or third, vacation home or investment property, I have the knowledge and highest level of skill to navigate you through the process.  Call me at 775-233-0682.
In-The-Know Real Estate Blog September 10, 2020

How Will the Presidential Election Impact Real Estate?

The year 2020 will be remembered as one of the most challenging times of our lives. A worldwide pandemic, a recession causing historic unemployment, and a level of social unrest perhaps never seen before have all changed the way we live. Only the real estate market seems to be unaffected, as a new forecast projects there may be more homes purchased this year than last year.

As we come to the end of this tumultuous year, we’re preparing for perhaps the most contentious presidential election of the century. Today, it’s important to look at the impact past presidential election years have had on the real estate market.

Is there a drop-off in home sales during a presidential election year?

BTIG, a research and analysis company, looked at new home sales from 1963 through 2019 in their report titled One House, Two House, Red House, Blue House. They noted that in non-presidential years, there is a -9.8% decrease in November compared to October. This is the normal seasonality of the market, with a slowdown in activity that’s usually seen in fall and winter.

However, it also revealed that in presidential election years, the typical drop increases to -15%. The report explains why:

“This may indicate that potential homebuyers may become more cautious in the face of national election uncertainty.”

Are those sales lost forever?

No. BTIG determined:

“This caution is temporary, and ultimately results in deferred sales, as the economy, jobs, interest rates and consumer confidence all have far more meaningful roles in the home purchase decision than a Presidential election result in the months that follow.”

In a separate study done by Meyers Research & Zonda, Ali Wolf, Chief Economist, agrees that those purchases are just delayed until after the election:

“History suggests that the slowdown is largely concentrated in the month of November. In fact, the year after a presidential election is the best of the four-year cycle. This suggests that demand for new housing is not lost because of election uncertainty, rather it gets pushed out to the following year.”

Will it matter who is elected?

To some degree, but not in the overall number of home sales. As mentioned above, consumer confidence plays a significant role in a family’s desire to buy a home. How may consumer confidence impact the housing market post-election? The BTIG report covered that as well:

“A change in administration might benefit trailing blue county housing dynamics. The re-election of President Trump could continue to propel red county outperformance.”

Again, overall sales should not be impacted in a significant way.

Bottom Line

If mortgage rates remain near all-time lows, the economy continues to recover, and unemployment continues to decrease, the real estate market should remain strong up to and past the election.

Reno-Sparks Market Report June 18, 2020

June 2020 Market Report

** Data in this report reflect market activity from MAY 2020 compared to the previous month and year.  Information is gathered from the Reno-Sparks Association of Realtors® (RSAR) for the Greater Reno-Sparks region via Northern Nevada Regional Multiple Listing Service (www.nnrmls.com).  Data accounts for single-family resale residences only, and excludes townhouses/condos, manufactured/modular and new construction.

Here is the market overview:

And here are a more detailed look at the stats for May 2020 compared to the previous month and year:

  • In May 2020, the Median Sales Price for single-family re-sale properties in Reno-Sparks combined was $399,900, a 3.6% decrease from April 2020, and a 2.5% increase from May 2019.  As seen in the graph above, the median sales price has hugged the $400k price point over the last year and appears to be steady at this time.

  • # of Units Sold inched up 387 to 396 from April to May 2020.  The sales volume is down 42% compared to the same month last year.  This volume is representative of properties that likely went under contract for sale in April and were in escrow for about 30 days.

Months Supply of Inventory (MSI) decreased 11.8% month over month from 2.4 to 2.1 months supply.  This measure of inventory is also about 5% higher than last year. MSI accounts for the time it would take to “sell out” of the Reno-Sparks inventory at the current rate of sale if no new listings came to market.  A balanced market is around 5-6 months of supply.  Therefore, with a low 2.1 months supply, we are still very much considered to be in a “Seller’s Market.”

The Average # of Days from Listing to Contract in May 2020 was 39 days.  Single family residences are taking 20% longer to sell this year than in May 2019, and only 1.6% longer than the previous month.  These averages account for all price ranges.

As seen in the graph above, homes that sold in the $200k to $700k range during May 2020 received acceptable offers significantly more quickly than the rest of the market.  The $1M to $1.5M range went into contract fairly quickly (66 days) compared to the $750k to $1M range and the $1.5M+ range (108 days).

With Seller’s receiving an average of 99% of asking in May 2020, we continued to see no significant change for this statistic overall.  Please note that price reductions may have occurred prior to receiving 99% of asking.

Is the economic impact of COVID-19 pandemic causing foreclosures and short sales in Reno-Sparks at this time?  So far, homeowners appear to be hanging in through the highest unemployment rate most of us have ever seen.  The percentage of distressed sales on the market did increase 7% month over month, but is still down 30% from May 2019.  Only 1.7% of homes listed on multiple listing service were considered “distressed,” meaning a bank-owned/foreclosure or short sale.

The last several weeks of real estate activity have brought a significant increase in the # of New Contracts.  Month over month, we saw a 635 New Contracts for sale, a 63.7% leap from April 2020 and a 3.9% increase from last year.

# of New Listings to hit the market the week ending in May 2020 increased slightly by 3.8% compared to April 2020.  Our # of New Listings are still down nearly 40% from the same period of time last year.

SUMMARY:

  • Inventory is still low, but what IS on the market is moving, as indicated by the significant increase in New Contracts, which should lead to an increase in sales volume in the coming months.
  • The Median Sales Price at $399,900 appears to be fairly steady at this time.  Over the last year, the $400k Median has been a benchmark the market has hovered around during the last 13 months.
  • The consensus among many real estate professionals is that “summer is the new spring.”  The typical influx of activity that happens in March, April and May is beginning happening now.  My colleagues and I have been extremely active over the last couple of months.
  • With low inventory, however, we’ll need to see if buyer demand for fewer homes listed will continue, and ultimately put more upward pressure on prices again.  Will the Median Sales Price start moving up again in the near future?  We shall see…
  • Buyer activity in Reno-Sparks comes largely from out-of-state, particularly California.  While many of our relocation clients are looking to escape the crowds, traffic and high taxes of California during COVID-19 uncertainty, they are finding more reasons now than ever to make that move.  We call them “California Refugees,” and we are here to help.  Email me at dhallerbach@intero.com to learn more about the many benefits of moving to Reno-Sparks.
Reno-Sparks Market Report June 4, 2020

Weekly Watch (Week Ending May 30, 2020)

For those of you who have followed my blogs over the past several years, my usual content offers the most exciting and interesting events and activities in Northern Nevada every week.  It is called “The Weekend Warrior.”  Since our social calendar has been obliterated by the COVID-19 pandemic, I shifted my focus to what is happening in the Reno-Sparks real estate market in “The Weekly Watch.” My objective is to keep you well-informed about weekly market trends so you can make informed decisions regarding your real estate investments.  The graphs below represent activity for single-family residences (excluding condos, townhouses and new construction) from the week ending May 30, 2020 compared to the previous week and year.  The numbers are subject to change slightly, due to late reporting by real estate agents to Northern Nevada Multiple Listing Service.

 

The Median Sales Price for single family residences in Reno-Sparks combined, at $420,000, increased 5% week-over-week and 8.3% year-over-year.  The Median Sales Price has hovered around the $400,000 mark over the last several months, and appears to be unaffected by coronavirus at this time.

 

The # of Closed Sales statistic is starting to show some hope, as 103 homes closed escrow the week ending May 30 compared to 93 homes the previous week, a 10.8% increase.  Though sales volume is still about 40% lower than this same time last year, we anticipate the # of Closed Sales should continue to increase as these are homes that went into contract about one month ago, and over the last several weeks, the # of New Contracts has steadily and rapidly increased.

 

Low inventory and continued Buyer demand are likely contributors to the high percentage of list price that Sellers are receiving.  The week ending May 30, Seller’s received and average of 98.6% of asking price.  Please bear in mind that some of these contracts may have come at a point after the Seller had reduced the list price.

 

During the week ending May 30, single family homes that closed escrow took an average of 44 days from listing the property to negotiating a contract.  This statistic is unchanged week-over-week, and up about 28% from the same week last year.  The # of Days to Contract stat is representative of properties that went into contract about 30 days ago, a customary timeframe for escrow.

Looking at the length of time from the property hitting the market to the date of written offer acceptance, the average days to contract were the greatest in the $900k to $1M price range.

 

The # of Active single family homes available for sale dipped again another 8% (-5.4%) week-over-week.  Since the WHO (World Health Organization) Pandemic Declaration, our active inventory has held fairly constant, as indicated in the circled timeframe.  Overall, 38% fewer active listings are on the market than the same week in 2019.

 

As more businesses resume “semi-normal” activity, and Buyers are getting out to find new homes and investments, we continue to see an increase of New Contracts week-over-week and year-over-year.  There were 7.5% more New Contracts the week ending May 30 than the week ending May 23.  And there are 19.3% more New Contracts than this same week last year.

 

The # of New Listings brought to market (116 listings) dropped again, with 18.3% fewer homes being listed the week ending May 30 compared to the week ending May 23.  There were nearly 31.4% fewer homes listed this week than during the same week in 2019.

Summing It Up…

  • Overall, the Sales Volume and # of New Listings on the market remains low, especially this time of year.
  • With New Contracts on the rise over the last several weeks, we should start seeing a subsequent increase in number of Units Sold in the weeks to come as well.
  • Sellers are receiving a high percentage of their list price and the Median Sales Price has ticked up to $420k again, likely due to the low-inventory market and steady buyer demand.
  • Mortgage interest rates are still extremely low, and many Buyers are taking advantage.  Email me today for a highly skilled and knowledgable lender recommendation.
  • For more information about the ins and outs of buying &/or selling real estate in today’s market, please do not hesitate to call me at 775-233-0682 or email dhallerbach@intero.com.
Reno-Sparks Market Report May 14, 2020

May 2020 Market Report

** Data in this report reflect market activity from April 2020 compared to the previous month and year.  Information is gathered from the Reno-Sparks Association of Realtors® (RSAR) for the Greater Reno-Sparks region via Northern Nevada Regional Multiple Listing Service (www.nnrmls.com).  Data accounts for single-family resale residences only, and excludes townhouses/condos, manufactured/modular and new construction.

Here is the market overview:

And here is the breakdown for a couple of interesting statistics from April 2020:

  • At $416,500, the April 2020 Median Sales Price for single-family re-sale properties in Reno-Sparks combined for the month was $416,500, a slight 0.4% increase from March 2020, and up 10.5% April last year.

  • As seen in the chart above, the # of Closed Sales at dropped from 507 in March 2020 to 374 in April.  This marks a 26% decline in closed sales month-over-month, and nearly 30% fewer closed sales compared to last year.

Months Supply of Inventory (MSI) in April 2020 jumped back up 31% compared to March, recording 2.2 months supply.  This measure of inventory is also about 6% higher than in April 2019. MSI accounts for the time it would take to “sell out” of the Reno-Sparks inventory at the current rate of sale.  A balanced market is around 5-6 months of supply.  Therefore, this the low 2.2 months supply, we are still very much considered to be in a Seller’s Market.

The average # of Days from Listing to Contract in April 2020 was 39 days.  This is still quite a short period of time when looking back over the last few years.  The # of Days to Contract is about 7% lower than April 2019.  These averages account for all price ranges.

With Seller’s receiving an average of 98.9% of asking in April 2020, we have continued to see no significant change for this statistic overall.

One may wonder if coronavirus is having an effect on the percentage of distressed sales in Reno-Sparks.  At this time, the answer appears to be “no.”  In April 2020, Distressed Sales (short-sales and foreclosures) are nearly 50% lower than the same time last year.

Here is what is happening now… The Week Ending May 9, 2020:

After 4 straight weeks of an increase in New Contracts, the week ending May 9 saw a relative leveling out of New Contracts, with just a slight 2.2% decrease from the previous week.  Overall, the number of new Contracts for this week last year is down about 10%.

# of New Listings to hit the market the week ending May 9 increased 25% compared to the previous week.  The Reno-Sparks real estate market saw nearly 42% fewer new listings than the week ending May 11, 2019.

SUMMARY:

  • Real Estate in Nevada continues to be an “essential service.”  Governor Sisolak’s mandate to eliminate in-person open houses for all properties, and in-person showings of tenant/renter-occupied properties has been extended to May 30, 2020.   All owner-occupied and vacant properties may still be shown to prospective buyers with practice of social distancing, use of personal protective equipment and frequent 20-second hand-washing &/or hand-sanitizing.
  • Starting May 4, California Bay Area agents were allowed to show occupied properties and to stage vacant properties once again. The allowance for such activities could potentially mean an increase of activity in Nevada, a place where many Californias are expected to call their “new home.”
  • Lending qualification parameters have tightened, but the Mortgage Interest Rates are staying low!  For a super reputable, local lender recommendation, contact me.  I will be happy to connect you with the best!
  • Looking more closely at the last full week of activity (ending May 9) the # of New Contracts has leveled week-over-week, and the # of New Listings rose slightly.
  • While the sales volume took a hit in April, the Median Sales Price has held steady, largely due to buyer-demand keeping pace fairly stable rate of sale and continued low inventory.
  • Nationally acclaimed economist and author of the Blog “ECON 70” Elliot Eisenberg, PhD checked in again with the Reno-Sparks Association of Realtors.  This month, Elliot stands by last month’s assertion that the current recession is very different from previous recessions, and that it will be deep but relatively short.  Click HERE to watch the April 2020 “Monthly Economic Minute.”
Reno-Sparks Market Report April 23, 2020

Weekly Watch (Week Ending April 18, 2020)

Currently we are living in a world that is ever changing. My goal in “The Weekly Watch” is to increase your knowledge about what is happening with your investments and to provide you with information to help guide your decisions during this unprecedented time. The following are highlights from the most recent real estate activity in the Greater Reno-Sparks Region. These graphs represent activity for single-family residences for the week ending April 18, 2020 compared to the previous week, and compared to the week ending April 20, 2019. The data excludes condos/townhouses and new construction.

 

The Median Sales Price jumped back up 4.4%, from $407,000 to $425,000 from the week ending April 11, 2020 to the week ending April 18, 2020. The Median Sales price is also up 10.4% from this same week last year. This statistic is reflective of properties that went into contract roughly 30 days ago (the common length of escrow for properties obtaining financing).

# of Closed Sales increased 17.8% between the week ending April 11 and the April 18, 2020. This number is down 22.5% from the same week last year. Again, this statistic is reflective of properties that went into contract about 30 days ago.

Of the properties that went into contract approximately 30 days ago, these 86 Sellers received 99% of List Price. This is a slight increase of 0.3% from the previous week’s closed sales.

# of Days from Listing to Contract increased 51.8% from the week ending April 11 to April 18. Though this may seem like a radical change week over week, it is only taking 3.3% longer on average to accept an offer for purchase than this same time last year.
In the week ending April 18, the Active Inventory dropped 5.6% compared to the previous week, and is down about 24% from the same week in 2019. This inventory includes properties of all price ranges.

During the week ending April 18, 30 single family residences were either withdrawn from the market, expired, or were temporarily withdrawn from the market. This number sharply increased 30.4 from 23 the previous week, but skyrocketed a whopping 130.8% from the same time last year. We’re going to have to blame this one on COVID-19!

With 110 New Contracts/Pending Sales during the week ending April 18, there are 27.6% fewer new contracts compared to the same time last year. However, the # of New Contracts/Pending Sales did increase 31% compared to the previous week. So this figure is encouraging. I can personally report that on April 18, I had 9 properties scheduled to show my buyers, and of those 9, 5 went into contract that day or shortly after. These properties ranged in asking price from $340,000 to $390,000. We definitely have buyers out there taking advantage of low interest rates and scooping up homes.

# of New Listings during the week ending April 18 declined 19.5% compared to the previous week, and a staggering 54% compared to the same time last year.Will this low inventory keep our prices steady? We shall see…

Summing It Up…

  • With the use of a “Coronavirus Property Entry Advisory & Declaration,” and strict practice of social distancing guidelines, real estate activity in Nevada continues.
  • Properties in Nevada are shown by appointment only. Owner-occupied homes and vacant properties are permitted to be shown, while all tenant-occupied properties are prohibited from showings. Traditional open houses are also not permissible.
  • Though sales volume, new contracts and new listings are significantly down compared to the same time period last year, single-family home prices do not seem to be affected. Median Sales Price, as seen in the above chart, is hovering around $400k and even appears to be edging up since mid February.
  • Mortgage interest rates are still VERY LOW… For home purchase and re-financing information and rates that apply to you, contact me, and I’ll introduce you to a reputable local lender.
  • While growing unemployment is still a major concern, we look forward to the return of business activity throughout the US and the continuance of our thriving Nevada economy.
  • While many Californias currently are suffering an economic hit, our suspicion is that those who were already planning a relocation to Nevada will be even more motivated once their feet are back on the ground. We just need to get on the other side of “the curve.”
  • For more information about specific property values and to search real estate for when YOU are ready to purchase/sell, please do not hesitate to call me at 775-233-0682 or email dhallerbach@intero.com.