Real Estate activity was relatively slow, and our median price remained flat in the first four months of this year, that all changed in May. At that point, the demand for single family homes in our area reached unprecedented levels. Here are a few statistics I’ve gathered throughout the year.
· Median Sold Price in Reno & Sparks rose over 14% YoY
· Despite the slow start, the total volume in sales increased by over 1% YoY
· Inventory remained historically low with an average of less than one month’s available supply
2020 was a year of paradox’s and real estate was not immune to the fray. While the overall value of our homes reached record levels, we found a big number of homeowners slipping into default. According to data released in November by Black Knight Inc, between 7 %– 8% of Nevada homeowners are in some form of distress, mostly in the form of forbearance. A back-of-the-envelope calculation puts the total number of Washoe County homeowners in distress at just over 7,000. This factor is a moving target and its’ long-term effect on our market remains to be seen.
Rental Rates: Defying the circumstances, the cost and demand for rental housing has remained strong. According to the 2020 Johnson/Perkins/Griffin 3rd quarter apartment survey, vacancy rates went down by over 1% while the average monthly rent rose by $52. Several new projects are coming on board this spring including the Reno Experience District (I still think of it as Park Lane) which may flood the market just a bit.
New Construction: Once again supply has fallen well short of demand and many if not most of our relatively affordable, single-family subdivisions are operating under a lottery system. This is a problem with no end in sight.
Luxury: Perhaps no other segment of our market tells the story better than this: In 2019 we saw a total of 228 sales over $1,000,000 in all of Reno & Sparks, in 2020 we closed 563. In my mind these numbers speak for themselves.
So, where is our market headed in 2021? All indicators point to the same. Job growth remains strong in most sectors and we continue to attract young talent to our area. Interest rates are predicted to remain historically low and even with the spike in prices, it is still less expensive to purchase a home rather than rent it in many cases. Additionally, Uhaul Moving & Storage recently published the fact that the number one out-of-sate destination for bay-area residents in 2020 was…. Wait for it… Reno. I think we’ll see more of that this year too.
dan@nvhomeconnections.com