September 2022 Market Report

** Data in this the September 2022 Market Report reflect market activity from AUGUST 2022 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) in Reno-Sparks dropped slightly for the third consecutive month, down 1.5% from $574,510 to $565,686. However, the MSP is still 6.7% higher than in August 2021.

While the Median Sales Price (MSP) in Reno ticked up 0.7% month-over-month, the MSP in Sparks fell 4.1% to $524,901 compared to last month. The MSI is still 8.4% and 5.6% higher respectively compared to August last year.

Closed Sales inched up about 2% compared to July 2022 and are down 22.2% compared to August last year.

Median Sold Price per Square Foot was $311/SF, down 2.8% compared to July 2022 and up 3.3% compared to last year.

The Months Supply of Inventory is the number of months it would take to sell through the available inventory at the current rate of sales. Though the Months Supply of Inventory (MSI) shifted from 0.8 MSI to 3.2 MSI over the last several months, August’s MSI was nearly 10% lower that July’s MSI. During August of 2021, the MSI was 0.8 MSI representing a market that was a 180% higher rate of sales compared to August 2022. Bear in mind, that a true “balanced market” is approximately 5-7 months supply, so though the market has shifted toward a “Seller’s Market,” we are still not at a fully balanced market.

As observed in the chart above, the faster pace of the $200k to $999k price ranges explains how the Months Supply of Inventory has hovered at about 3 MSI despite thte MSI in the Luxury Market leaping to over 10 MSI.

Median Days to Contract has increased from 25 to 32, a 28% increase month-over-month, and a whopping 433.3% increase year-over-year. However… let’s take a look over the last several years… The median Days to Contract is still WELL below the peaks of 2013, 2016, 2018, & 2019.

The Luxury Market showed properties taking about 62 days from listing to receiving an acceptable offer. This is approximately double the Median of all price points and likely the reason that we saw a 28% increase month-over-month and a 433.3% increase in Days to Contract year-over-year.

New Pending Sales increased 29.2% from July to August 2022. There are 13% fewer New Pending Sales compared to last year.

15.8% fewer New Listings hit the market in August 2022 compared to July 2022. We saw a 20.2% decline in New Listings compared to last year as well.

OTHER INTERESTING STATS TO KEEP AN EYE ON:

Keeping an eye on the distressed sale market, at this point, we are still NOT seeing that recent market activity is causing more properties to be sold as foreclosures. Short-sales are few and far between due to the great amount of equity many home owners currently have in their properties.

The % of Cash Purchases has increased 3.6% month-over-month for all single family sales in Reno-Sparks and are 2.5% higher than last year. 26.1% of all sales in August 2022 were cash.

August 2022 saw 32.3% more Withdrawn and Expired Listings compared to the previous month, and a staggering 203.4% more compared to August last year. This is an indication that many Sellers are fatigued and frustrated with not receiving an acceptable offer during their listing period.

With Pending Sales jumping up in August, we naturally experienced a slight decrease in the number of Active Listings, posting 8.1% fewer compared to July 2022. The active inventory was 117.4% higher than August 2021.

15.6% of all sales during August 2022 resulted in closing prices above list price. Historically, statistic is actually more normal compared to the market madness and overbidding we experienced during the first 2 years of the COVID-19 pandemic.

SUMMARY:

- Over the last several months, the real estate market globally has shifted, with more days to contract, price reductions and cash incentives for Buyers.
- The rapid appreciation experienced during the first 2 years of the pandemic appears to have ceased, but the market is not dead.
- On the bright side, Buyers have more opportunities to place offers with little to no competition and potentially receive cash from Sellers to exercise as credits toward closing costs or mortgage rate buy-downs.
- Mortgages rates have popped back up to around 6% for qualified buyers. Though this does seem high compared to the historic low rates in 2020 and 2021, Buyers can be thankful that rates are not 18.63%, the peak back in 1981. It could be much worse!
- More important than ever, Sellers must not over-price their properties when listing them for sale. Overpriced properties tend to sit longer and lose more value in the long-run due to the need for eventual significant price drops. Maintenance and proper preparation & staging are critical for successful sales as well.

Do you need expert guidance for your next real estate purchase or sale? As a Buyer, you have more negotiating power than you have in many years, so this may be the time to leverage your next purchase. Sellers… Let’s meet to strategize about how to professionally prepare and price your property strategically in our marketplace. I am here for you, whatever your real estate needs are. Email me at dhallerbach@intero.com or reach by cell at 775-233-0682 so we can discuss the best plan for YOU!

~Denise Hallerbach, Broker-Owner, INTERO RENO.