Home Prices And Sales Decline In Reno Area
A reader posted this report on the Reno area. “Fewer and fewer homes are being sold in Reno-Sparks, according to the latest sales data. In April, 358 single-family existing homes were sold in the Reno metropolitan area, a 36 percent decrease from the same month in 2005. Even in the historically hot-selling spring months, the real estate market is slowing.”
“‘I thought April was going to really kick it in, and it did a little bit more than in (January and February),’ said (broker) Pat Martinez. ‘But it wasn’t as much as I thought it would be. Buyers, at least the ones I have, are really taking their time.’”
“Despite that, the Reno metropolitan area median home price is still holding relatively steady, slipping to $335,000 in April from $340,000 in March. Indeed, the median time a home stayed on the market in April was 73 days in the Reno metropolitan area, a 40 percent increase from April 2005. But in Reno, where the median sales price stood at $388,200 in April, it took a median of 81 days. Reno’s April median sales price represents a 2 percent decrease from April 2005.”
“‘Overall, it’s obvious things are definitely slowing down,’ said (analyst) Brian Kaiser. ‘Everyone expected this to happen quite a while ago, so we are just finally seeing the effects of it in the numbers.’”
“In Carson City, the median price for a single-family home was $310,000, down from $320,000 in March and a 10 percent decrease, year over year. The median price for condos in the capital fell to $160,000, down from $169,000 in March and a 10 percent decrease from April 2005.”
Thanks to the reader who posted this. For some reason, Reno and Las Vegas articles rarely show up in search engine queries.
This drop in what should be the busy season is big news, IMO. And it is occurring in dozens of markets all over the US.
Reno: $388,200, down 2 percent
Sparks: $325,000, up 7 percent
North Valleys: $275,000, up 2 percent
Carson City: $310,000, down 10 percent
Minden/Gardnerville: $380,250, down 7 percent
Dayton: $280,250, up 2 percent. Fernley: $250,675, up 14 percent
Fallon: $234,147, up 20 percent
Perhaps some locals can give some insight into these smaller markets. I know Fallon’s median price has been falling for several months.
It’s far worse than your article mat indicate. 80 days on the market is BS. Re-listings and the like screw that number up. The only houses that are moving are the ones making drastic reductions of 10%+. Reno is going to get slammed, but survive. The outlying areas you mention above that are so reliant on the construction industry are doomed.
North Valley will take a hard hit. Speculators saw a bunch of new houses being built and ran up the prices just as high as other areas. People have always moved to the North Valleys becasue they could not afford any other area. While the houses might be new, the schools are still big time crap!
YOY declines!!
Finally, price decreases rather than just decreases in sales volume.
I’m not sure what is going on in Fallon. We call it Fallabama. There is a navy base out there, with the top gun program & a cancer cluster. As someone else said it’s very dry, and makes Reno look like a rain forest.
Dayton, I hear is dead. It’s about 15- 20 miles east of Carson City.
Carson City is the capital. A lot of state worker, very middle class, but most (even with 2 incomes) don’t make anything close to support a $310K median. Carson City is really a county, it goes all the way to Lake Tahoe, where RE has been pricey forever.
Minden/Gardnerville…The landscaping is very beautiful, not at all what you would expect from Nevada. The area has always been the ‘high rent’ area. Like Carson City, Douglas county goes all the way up to Tahoe.
Reno/Sparks…Gaming of course along with manufacturing and warehousing.
OT…
Poll on Yahoo Finance today
http://post.polls.yahoo.com/quiz/financeresults.php
Many home building stocks are trading near 52-week lows. Is this a buying opportunity?
Yes. They still have sturdy foundations. 21%
No. A house of cards is more like it. 58%
They’re fairly valued. 23%
56644 Votes to date
For some reason the link doesn’t work for me.
Go to the main page… then scroll down and it will be on the right side.
Sorry for the bad link above
http://finance.yahoo.com/
They have changed the poll to inflation. 70% concerned, 30% not concerned.
new record in phoenix 46064
hey bush is in yuma, may he will buy a house in AZ
No, but he will let in as many illegals as it takes to keep the economy humming.
Hey the next Bubble Cycle - Illegal immigrants - Buy yours today! They only go up.
Yeah I live in Phoenix and the number keeps climbing. I know here in Chandler alone they are in the process of converting somewhere around twelve apartment complexes over to condos. I think that no way they sell. I know the one that I was recently at in south Chandler the owners said keep the property 80% occupied and at the beginning of this week they said bump the occupancy back up to 90%. Whats going to be amazing is how many of these nice new homes that investors purchased and have put renters in. I’m starting to see some of them in my occupation and there have ben a few just trashed. The last one I went to in Avondale was about three years old. The flooring was trashed, doors were trashed, and graffitti painted on the walls. I’m guessing maybe $6,000 to turn this unit. WE have been heading downhill here in Phoenix but I have a feeling that we are in the very early stages. This thing is going to be ugly when its finally done.
They’ll sell for $100k each, if at all.
Reno, Sparks and Carson city have no good jobs. Pay is not good either in these areas. Most people who expect high sale price on their homes can no way afford it themselves. Wonder what makes them think others can??? Buyers are not STUPID…
People moving out of CA are driving prices up in other states.. If I were a Californian moving to other state I would never pay $500K for $250K home in states like NV, AZ…Why would I pay more for something that is not worth the money just bcoz I got a big sum selling my home in CA….that is something Californians need to think about…
Although Reno is getting much better, I agree with you on the “no good jobs.” You take away the money that this real estate frenzy has created in the last 5 years and your left with jobs where it’s hard to make more than $15 an hour up here. Outside of real estate, most household incomes that I see cross my desk don’t exceeed 50k combined. This why I said earlier it’s going to get real bad here.
I keep saying the median needs to be under 200K, and there needs to be some 3/2’s in the 150K range that is in a safe area. Everyone thinks I’m a nut, but that is what is affordable to the locals.
Agreed
What may be even more telling about this article is that while it’s been years since I’ve been there, I’m pretty sure Reno has but one economic driver. This may be the canary in the coal mine for “2nd. homes”. I suspect nnvmrtgbrkr may have more direct knowledge of this market. Like Ben says, “2nd. homes” were really just an excuse to speculate. How many of us really thought anyone was going to occupy these homes? Many that are now on the market boast that they “have never been lived in”. Well, what kind of a boast is that? It’s almost like those ridiculous Barrett Jackson Auto Auctions where everyone ooohs and ahhhs and they get bid up ever higher. We’re then left to wonder as we see the proud new owner put it on a trailer to take it home to his/her personal collection where it too will never be used.
Judging from the photos of houses are the market, I would guess 1/2 are empty.
Was it Monday or Tuesday I posted the MLS? It was around 8,550. In 2 or 3 days is up to 8,822. The population for the area is around 300 or 400K
http://rgj.homescape.com/rgj/index_map.jhtml?userId=COVEGCAUHORG5LAZGQPSFEY227531&_requestid=17818
I once had a second vacation home. Quickly realized it was the most expensive hotel room I ever owned.
” Buyers, at least the ones I have, are really taking their time.’”
Surely the smart ones will take years to buy.
This is great news for me as I wait to see when Las Vegas starts showing more bad news.
Simmsays…
http://www.AmericanInventorSpot.com
simmssays,
Me too! Me too. Vegas has been my “target market” all along. Since I wouldn’t live in “DC” if they were giving away houses (no offense) but their bubble just doesn’t mean as much to me. Now I do appreciate their efforts and rejoice along with them on each and every price reduction what I really want is 5 bd/ 5ba GOTstucco palace for a fraction of what the original lender is on the hook for! I will then spend only about six of Oregon’s worst weeks there so I can leave the neighbors with the impression I “come from money”. What a gas man! What a gas.
More and more as astute fellow “bubble heads” continue to overwhelm me with their tireless research efforts I’ve come to the conclusion that the time to SELL was 2003 and 2004 (not buy). One more time, “the only people that buy at the exact bottom and sell at the exact top are called what class? Yep, LIARS! Sellers have been in a perilous way since we started 2006 and many of the astronomical prices we saw listed in 2005 have yet to sell! The data is supporting this time and again. This all leads me to believe that (yes you’ve heard me say this before) that the origins of the bubble go back to 1997 when tax legislation effectively created “tax free” money up to the tune of 500K every 24 months. And we wonder why we have a bubble?
Let’s see here? I can save money through my 401K by contributing a little bit every payday OR! the $300 a month I DON’T contribute could be more effectively applied to “qualify” for an even bigger mortgage (I can’t afford) to get even more “tax free money” NOW! Not in 30 years, NOW! Which would the average American prefer to do? Save now and spend later OR! spend now AND spend later and then spend some more?
I came across Dewey’s cycles theory the other day, in which he claims that real estate moves in 18.3 year cycles. I’m just curious if his theories have been discredited, or if some people still put any faith in them. If 1989 was the last top for real estate (at least in OC), then 18.3 years would put the top for this cycle in 2007. I’m not sure that I can buy into a theory that would say that each cycle is always the same length, especially since other factors (tax code changes, interest rates, availability of credit, bubbles or run ups in other sectors, etc.) are not going to follow this same cycle. On the other hand, there is some gut level feeling that maybe a cycle this long might have some validity as people tend to have short memories, and you can see it with the bubble today. Anyone have any thoughts or info on Dewey’s cycle theory?
Read “A Random Walk Down Wall Street”.
Short version: Using honest statistical math, there are no patterns in the markets. Some fraction of people will make more than average, some less than average, as you would expect from a statistical ensemble.
The only ones who are guarenteed to get rich are the ones selling you the idea that there’s a pattern.
Thanks for the info. I will take a look at the book.
People are extremely good at seeing patterns in random numbers ( just like ink blot tests).
I am a graduate of Carson City High School and a graduate of the University of Nevada, Reno in chemical engineering. I left the area due to the fact that local jobs do not pay well. Northern Nevada does not have a diversified economy. The area is built upon real estate, state government, casinos/hotels. I concede there is some light manufacturing, but the wages are low and you are lucky to get benefits in that area.
In my opinion, Northern Nevada is entirely dependent on a constant flow of California refugees, i.e. equity nomads to keep the economy growing. It’s a strategy that actually has been quite successful for many decades in fact. The only problem was that it left out people like me, who were young and from the area and trying to get a start in life. I am now in Saint Louis.
But now prices have gotten out of control, and one leg of the table is going taken away. N. NV better hope that Californians continue to gamble…. I hope they don’t have financial difficulties in CA!
It might be that California in desperate state financial straights legalizes all gambling. The Tribes and Vegas will scream but wow, the repurcussions.
I think you’d see prop 13 ‘modified’ before you’d see Vegas style gambling legalized in CA.
The problem with modifying Prop 13 is that every single possible change will absolutely without a doubt lower State revenues. I know that sounds Lafferesque but it’s true. The only real disconnect in Prop 13 is commercial/business property. California is already an openly business hostile environment. Any revaluation there would kill productive businesses. Any attempts to establish multiple tier tax rates have already been nixed by the Supreme Court and their “welcome stranger” precedent setting ruling. Any attempt to do a “reset” would flood the housing market crashing all values (and therefore tax revenues) while the case worked through the courts regardless of outcome. Perhaps increasing the 2% per annum cap to 3-4% is possible but that would be a very small, at best, near term gain at great political cost. It’s a tax, of course it is unfair. Rather than worry about revenues we need to control spending. Giving more drugs to the addict isn’t going to fix the problem.
The state has already allowed the Indian gaming casinos. I can’t see why folks would keep driving through the Sierras to go to Reno when the Indian casinos are newer, and nicer than the garbage found in Reno. Carson City is nothing but low rate casinos, was just there. Tahoe is beautiful though. CA as a state is going down the tubes, just as many new home “owners” (LOL) who are really homedebtors for life are on their way down the tubes. Just a question of who will go first. To all CA, get the hell out of CA while you have a chance. Ciao.
Carson City is not a tourist town, it’s a government town.
A lot of people stay in Reno when to come to ski, or enjoy Lake Tahoe.
That said I believe Nevada will be hit hard by the coming RE crash. Of course anyone who works in RE will be hurt, but so will anyone in tourisum (as Califorians tighten their belts).
I like to go to Reno to gamble better than an Indian casino. At least in Reno you can walk around and go to other casinos. In a Indian casino you are stuck on one casino with no where else to go. And the odds are better in Reno, although they of course favor the house.
THe smart folks have bailedout ofCA. The dumb ones will spend that last HELOC $ trying to win the $MILLION jackpot to save their overleveraged McMansion and Hummer
After the last $ from CA is spent, then NV is toast. ANd so is Arnold and Co.