Market Trends Q2 2016 Market Report for the Reno/Sparks Region
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2nd Quarter
Median Sales Median SalesPrice Price & and Average Sold Price per Square FootFt Average Sold Price per Sq SPANISH SPRINGS
NORTH VALLEYS
SINGLE FAMILY
CONDO
Median Sales $$ Median Sales $$ Year to year change + Year to year change + � Average Price/SF
Average Price/SF
SINGLE FAMILY
CONDO
Median Sales $$ Year to year change �€ €
Median Sales $$ Year to year change Â?Â? Â?
Average Price/SF
Average Price/SF
NORTH URBAN
SINGLE FAMILY
CONDO
Median Sales $$ Median Sales $$ Year to year change + Â? Â Year to year change +Â? Â? Average Price/SF
Average Price/SF
SPARKS
SINGLE FAMILY
NEW NORTHWEST
SINGLE FAMILY
CONDO
Median Sales $$ Year to year change +€ �
Median Sales $$ Year to year change + Â? Â?Â
Average Price/SF
Average Price/SF
CONDO
Median Sales $$ Median Sales $$ Year to year change Â? Â? Year to year change Â?Â?Â? Â Average Price/SF
Average Price/SF
OLD SOUTHEAST
SINGLE FAMILY
CONDO
Median Sales $$ Median Sales $$ Year to year change Â? ƒ  Year to year change Â?Â?Â? Average Price/SF
OLD SOUTHWEST
SINGLE FAMILY
CONDO
Median Sales $$ Year to year change Â?Â? Â
Median Sales $$ Year to year change Â? Â
Average Price/SF
Average Price/SF
SINGLE FAMILY
CONDO
Median Sales $$ Median Sales $$ Year to year change -� � Year to year change �€ € Average Price/SF
Average Price/SF
Source: Northern Nevada Multiple Listing Service (NNRMLS)
Average Price/SF
NEW SOUTHEAST
SINGLE FAMILY
CONDO
Median Sales $$ Median Sales $$ Year to year change � �ƒ  Year to year change � ƒ �� Average Price/SF
NEW SOUTHWEST
Average Price/SF
Who’s Buying the House Next Door a study of the Reno-Sparks housing market I have been writing about the pain of the lack of homes for sale in our marketplace for some time, and that hasn’t changed at all except for an increase in the median price of homes in the Reno/Sparks area; up to $310,000 this past May. If you break it down further and only look at Reno, the median price for that same period was $326,000. We still have only a one-month supply of homes available under $300,000, instead of the 180 days that is considered a “balanced” market. And, we have only a 3 month supply in the price range from $301,000 to $600,000. These two price ranges are where 95 percent of the sales in our area occur. To date, we are not building or listing homes fast enough to meet the demands in our marketplace. I believed, like many of our sellers, that active listings were being purchased by the hundreds of employees being hired by the 100plus new companies in our community, a phenomenon we lovingly call the “Tesla Effect.” To prove my point, I surveyed 32 Dickson Realty agents that represented buyers from January 2016 to June 2016. I asked the questions: Where did your buyer come from? Were they investors, local buyers or buyers from outside the area? If they relocated, where did they relocate from, and did they relocate to work for a new or existing company? I captured in my informal survey information on approximately 65 percent of all buy sides from Dickson Realty from January 1st to June 24th. I made the assumption that our firm was indicative of all purchasers in the Reno/Sparks area. I was surprised by the results, and perhaps you will be as well. Here is what I discovered: • • • • • • •
51% were local buyers (owner occupied, not investors) 22% of buyers were investors 9.4% were parents purchasing for UNR students 7% were moving from other states to work with existing companies 4% of buyers were retiring from California 2.7% were medical professionals 2.3% were small- to mid-size company owners relocating their companies to northern Nevada • The remaining 1.6% was a combination of reasons, such as a new pastor in the area, retirees moving from Elko or older couples moving to be near family What did not show up, are the hundreds of employees that I assumed were buying homes and moving into the area to work for new companies. Of course, for many of these companies, it may simply be too soon as they are not fully operational yet. While the “Tesla Effect” may not yet be fully present in home purchases, we have witnessed an increase in website traffic from people wanting to learn more about our community and neighborhoods, researching home values and registering to receive information about new listings coming on the market. People from outside of our area are spending more time on our website when we compare year-over-year analytics, and we are seeing more first-time and returning visits to our website than ever before. These statistics were surprising because they indicate we haven’t yet seen, except perhaps in the rental market; the impact of new employees in our area. Hopefully, by the time they begin to look for homes, our inventory supply will have increased, otherwise the median pricing will continue to rise and with that, cause affordability problems, as we have witnessed in the rental market. While Reno and Sparks have not been relocation hubs in the past, the EPIC Report and reports by EDAWN and the Center for Regional Studies at UNR have projected an estimated 50,000 new jobs coming to the region. At Dickson Realty, we have hired a new Vice President of Relocation, Kylie Rowe. This is the first time in 40 years that we have needed a highly skilled employee working full-time with companies and their relocating employees. It is critical to both new and current regional employers, that we help their employees moving to the area integrate into our community as quickly as possible, and with sufficient housing inventory, they will be buying the house next door. This article was authored by Nancy Fennell, President of Dickson Realty, and originally appeared in Northern Nevada Business Weekly on Monday, July 4, 2016.
Reno-Sparks Market Profile Let’s compare the Reno-Sparks housing market activity, from May to June 2016, and also to activity from June 2015. According to the Reno Sparks Association of Realtors, the Median Sold Price for single family homes in the Reno/ Sparks area increased by a meager on half percent to just over $311,000 in June. When we compare this to a year ago, there was a very robust 11.3% increase, validating a strong market locally. Industry experts are not predicting a bubble at this time, as the increases in value are being fueled mainly by economic growth and jobs in our region. The number of homes sold increased modestly from 593 in May to 636 in June. Although more homes sold when comparing month over month, there was a 3.2% decrease in units sold when comparing year over year data. There were 798 new listings on the market in June, which is a 2.3% more than a year ago, but 56 fewer, or a 6.6% decrease in new listings than last May. Although we are seeing a small increase in new listings year over year, the current demand for homes continues to outpace the supply. We’ll continue to experience a strong seller’s market until more homes are offered for sale in the region. As we look at the Inventory numbers, there were 2,079 homes available for sale in June; which was a measly 50 unit increase from June 2015, but nearly a 4% drop from May. All this information allows us to calculate the Months Supply of Inventory, which remains historically low in the most active price ranges below $600,000. Overall, there was a 3.3 months’ supply of inventory in June, which is a 10% decrease from May. The National Association of REALTORS considers 5 to 6 months of inventory to be a healthy housing market, where neither buyers nor sellers have a distinct advantage. What does all this information mean to you, and why should it matter if you are a home buyer or seller? The lack of inventory and our region’s economic growth will continue to drive home prices higher. Low mortgage rates will also contribute to a steady stream of home buyers. As prices increase, concerns of affordability are making headlines. If you are thinking about buying, now is the time to get prequalified for a mortgage and start your home search. Whether you are buying or selling, talk to a Dickson Realty neighborhood expert first. Dickson Realty agents have the best tools, training and leading technology to stay in tune with the market. We are ranked the number one real estate company in the Reno, Sparks, Lake Tahoe market, and we’ve been assisting buyers and sellers in northern Nevada for over 40 years.
I’M LOCAL I’M GLOBAL
TM
INDUSTRY-LEADING SALES. WORLD-CLASS SERVICE.
As an affiliate of Leading Real Estate Companies of the World,® our brokerage is a global — not just local — real estate company working on your behalf. LeadingRE provides world-class marketing and resources, allowing us to provide the very best service. The result? Our organization produced more home sales volume in 2015 than any national franchise, over $351 billion, representing over 1.1 million transactions.
PRODUCING ONE-THIRD MORE U.S. HOME SALES VOLUME IN 2015 THAN OUR CLOSEST COMPETITOR Volume shown in billions of dollars OVER ONE MILLION TRANSACTIONS VALUED AT $351 BILLION IN ANNUAL HOME SALES
4,000 OFFICES 128,000 SALES ASSOCIATES OVER 55 COUNTRIES
n Leading Real Estate Companies of the World® Leading Real Estate Companies of the World
550 COMPANIES
350
$351
$265
n RE/MAX n Coldwell Banker n Keller Williams n Century 21 n Berkshire Hathaway Home Services n Sotheby’s International Realty n Prudential n ERA n Better Homes & Gardens n Realty Executives n Real Living n HomeSmart
$262
$208
®
$113
300
250
200
150
100
$98 $77 50
$45 $28 $18
$17
$11
$8
0
Actual member statistics for LeadingRE and estimates for other networks using average sales units per agent and average sales price for firms in each respective network from published sources for 2015 production. Sources: REAL Trends National Network 2015 Totals Final Report. REALTOR® Magazine 2015 Franchise Report. ®
© 2016 Leading Real Estate Companies of the World. All Rights Reserved. C–Sales Volume. 04.16
Equal Housing Opportunity
DOWNTOWN RENO 775.324.7000
CAUGHLIN RANCH 775.746.7000
DAMONTE RANCH 775.850.7000
SOMERSETT 775.746.7222
TRUCKEE 530.587.7444
GRAEAGLE 530.836.1700
DONNER LAKE 530.587.4811
MONTRÊUX 775.849.9444
SPARKS 775.685.8800
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© 2015-2016 Dickson Realty. All rights reserved. Although the information above is deemed reliable, Dickson Realty does not guarantee its accuracy. If your property is currently listed for sale, this is not intended to be a solicitation.