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