January 2022 Market Report

** Data in this report reflect market activity from DECEMBER 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.

The Median Sales Price (MSP) remained steady in December and was $545,000 in Reno-Sparks. The MSP was just 2% higher in December 2021 compared to November 2021, and 21% higher than December 2020. As typically experienced during the winter months, inventory has stayed extremely low. Despite mortgage rates rising, Buyers are still in the market and often bidding properties over-asking when the property is priced at or near market value.

Though we have heard a lot lately about the expectation that Mortgage Rates will be rising in 2022, looking back over the last 3 years, even if they rise to 4% as predicted, rates would still be lower than they were three years ago.

4.6% fewer single family homes sold in Reno-Sparks in December 2021 compared to November. And 6.3% fewer homes sold in December 2021 compared the same the previous year. Roughly the same number of single family homes sold in December 2021 compared to 2 years ago.

The Average Sold Price per Square Foot holds at $305/SF for the second straight month. Since December 2020, the Average Sold Price per Square Foot increased 21.5%. However, looking at the last several months, we appear to have reached a bit of a plateau at the moment. Please note that these figures represents the average over ALL price points.

See chart ABOVE for the breakdown of The Average Sold Price per Square Foot by price range. The most significant change (November 2021 to December 2021) was seen in the $1.5M+ price range ($468/SF increased to $492/SF). Most other price points remained relatively static or dropped in December 2021.

Months Supply of Inventory (MSI), a calculation of the rate of sales, in December 2021 was 0.5 MSI. compared to 0.8 MSI the previous month, a 33.3% change month-over-month. The rate of sales was the same as it was exactly one year ago. Consider this… if the rate of sales in December 2021 continues at the same pace, and no new listing were added to the market, the entire inventory of single family homes would be “sold out” in approximately 2 weeks. A balanced market is approximately 5-6 months supply.

Inventory is at all time lows!! As of January 12, 2022 at 6:45 am there were only 236 active single family residences on the market in all of Reno and Sparks, across all price-points (not including condos). Pickings are SLIM!!

The Median Days to Contract over ALL price points during December 2021 was 15 days compared to 16 days in November, a 6.3% decrease month-over-month. The Median Days to Contract has increased 88% since December 2020.

The # of New Contracts (homes with accepted offers) decreased 17% month-over-month and and was about the same as December 2020.

The # of New Listings dropped from 376 in November to 295 in December 2021, a 39.7% decrease. The # of New Listings in December 2021 was nearly identical compared to two years ago. We expect that New Listings will begin to increase again in January or February as seen in the graph BELOW.

SUMMARY:

- The Median Sales Price is holding steady at $545,000 for Reno and Sparks combined.
- # of Units Sold declined again in December 2021, which is typical during the winter months.
- A balanced market sees 5-6 Months Supply of Inventory (MSI) and the current rate of sales is 2 Weeks Supply of Inventory… We are still looking at a Seller’s market.
- # of New Listings may very well be at its low-point for season, as seen in the previous graph. We typically begin to see an increase in New Listings after the 1st of the Year. Looking forward to that happening!!
- Interest Rates are on the rise, but not expected to travel much higher than 4% by the end of 2022. How will this impact Buyers in today’s market? Only time will tell!
Big questions for the coming months and year?

1) How will the surge in Omicron COVID-19 cases affect the real estate market?

2) Will rising mortgage rates impact Buyer affordability as we progress through 2022?

3) If Buyers retreat from the market due to higher mortgage rates, will this result in a flattening of the market?

4) Let’s see what happens over the coming months and year!!

Are you in need of guidance for your next real estate purchase or sale? I am here for you. Email direct dhallerbach@intero.com or reach by cell at 775-233-0682 so we can discuss the best plan for YOU! Thank you, ~Denise Hallerbach, Broker-Owner, INTERO RENO.