The 2015 Reno/SparksResidential Resale

Market Report

Dave HansenPresident

Reno/Sparks Association of REALTORS®Coldwell Banker Select Real Estate

www.rsar.net

A Little History First

• Let’s look at the NAR data and then• Let’s look at the local data

• Some charts will be similar, but there are differences

Homeowner Households from 2010 (Decreased by 1 million)

In thousands

Renter Households from 2010(Increased by 4 million)

In thousands

Nationwide Home Price Recovery(Almost Doubled over 20 years)

FHFA Home Price Index

Local Home Price Recovery

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30-year Mortgage Rates

Value Is Again Supported By Sales

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Is It a Seller or Buyer Market?

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Almost Constant Sales Appetite

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SalesTOTALS

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SALES VS ACTIVE IN-VENTORY

Reno/Sparks Median Prices

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$300,000 Recent Median Price TrendingSingle Family Homes

New Listings Are Bouncing Back

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Just who are these buyers?

• The National Association of REALTORS (NAR) creates a survey of buyers and sellers every year and we have pulled some interesting details out of these reports

Reason for New vs. Resale Home2013 2014

New Home 16% 16%

Avoid renovations or problems with plumbing or electricity 32 40

Ability to choose and customize design features 25 24

Amenities of new home construction communities 14 17

Lack of inventory of previously owned homes 10 10

Green/energy efficiency 6 9

Previously Owned Home 84%

Better price 30% 32

Better overall value 28 32

More charm and character 17 19

Lack of inventory of new homes 9 9

Distressed Sales Disappearing

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The Sales Mix - 2013 - 2014

Shrinking Shadow Inventory(but not in CT, NY, NJ)

2013 Distressed Sales

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Short Sales; 1498

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2013 Special Conditions Home Sales Mix

2014 Distressed Sales

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Short Sale, 569

REO, 333

2014

Where is our Shadow Inventory

• NOD = Notice of Default– Prospect for a short sale

• NOS = Notice of Sale– Going to Auction

• REO = Bank Owned– Sale at discretion of “Asset Managers”

383 Bank Owned Properties Not Currently For SaleGreater Reno/Sparks

Data is from RealtyTrac January 2015

577 Pre-Foreclosure PropertiesNot Currently For SaleGreater Reno/Sparks

Data is from RealtyTrac January 2015

150 Properties Going to AuctionNot Currently For SaleGreater Reno/Sparks

Data is from RealtyTrac January 2015

New Jobs Are On Coming!

Jobs are coming to our area

• EDAWN brings over 2000 jobs in 2014• Tesla will bring 6500 primary jobs

– And up to 10,000 secondary jobs• Defeat of Margin Tax removes stumbling block• Unemployment falls to close to 6%• Nevada Governor’s Economic Development

– GOED is bringing more jobs to our area

NV Jobs in Tourism & Gaming

Data from GOED

NV Jobs in Aerospace & Defense

Data from GOED

Nevada Jobs in Energy

Data from GOED

NV Jobs in Information Technology

Data from GOED

NV Jobs in Logistics & Operations

Data from GOED

NV Jobs in Manufacturing

Data from GOED

It pays to be different

• In the past we have evaluated affordability for the entire region.

• Home owners with different incomes are attracted to different areas.

• Here are some areas selected for continued population growth.

Affordable House Defined

• Used the median income for each Zip Code

• Used PITI and 28% Mortgage Debt to Gross Income

• Interest was increased by 1% for end of 2015

• The Washoe medium income in 2014 was $53,994.

Population 25,400 25,700

Homes Sales in 2014 = 370

Est. Shadow Inventory = 198

89434 Sparks East and Foothills

2014 2015 est.• Median Home Value $199,000 $208,600• Median Household Income$55,788• Affordable House Value $267,668 $238,309

• January 2015 Inventory 30• Homes below $267,668 11• Homes below $259,000* 9

*Washoe County Affordable Home

Population 37,400 39,500

Homes Sales in 2014 = 886

Est. Shadow Inventory = 70

89436 Sparks Suburban & Spanish Springs

2014 2015 est.• Median Home Value $260,000 $270,000• Median Household Income $79,216• Affordable House Value $380,074 $338,309

• January 2015 Inventory 104• Homes below $380,074 87• Homes below $259,000* 22

*Washoe County Affordable Home

Population 42,400 43,800

Homes Sales in 2014 = 652

Est. Shadow Inventory = 10

89506 Reno North Valleys & Stead

2014 2015 est.• Median Home Value $172,000 $181,400• Median Household Income $57,496• Affordable House Value $275,862 $245,605

• January 2015 Inventory 43• Homes below $275,862 29• Homes below $259,000* 27

*Washoe County Affordable Home

Population 25,900 26,400

Homes Sales in 2014 = 434

Est. Shadow Inventory = 9

89511 Old Southwest Suburban

2014 2015 est.• Median Home Value $475,000 $489,100• Median Household Income $92,166• Affordable House Value $442,207 $393,705

• January 2015 Inventory 153• Homes below $442,207 11• Homes below $259,000* 2

*Washoe County Affordable Home

Population 24,400 26,200

Homes Sales in 2014 = 620

Est. Shadow Inventory = 21

89521 Reno South Meadows

2014 2015 est.• Median Home Value $286,000 $294,000• Median Household Income $72,900• Affordable House Value $349,770 $311,406

• January 2015 Inventory 93• Homes below $349,770 49• Homes below $259,000* 10

*Washoe County Affordable Home

Population 33,400 34,300

Population 33,400 34,300

Homes Sales in 2014 = 545

Est. Shadow Inventory = 24

89523 Reno Northwest Suburban

2014 2015 est.• Median Home Value $280,000 $289,500• Median Household Income $67,952• Affordable House Value $326,030 $290,270

• January 2015 Inventory 90• Homes below $326,030 14• Homes below $259,000* 8

*Washoe County Affordable Home

Population 19,011 20,200

Homes Sales in 2014 = 457

Est. Shadow Inventory = 79

89408 Fernley

2014 2015 est.• Median Home Value $144,000 $150,000• Median Household Income $50,213• Affordable House Value $240,919 $214,494

• January 2015 Inventory 63• Homes below $240,919 49• Homes below $259,000* 53

*Washoe County Affordable Home

The Take Away for 2015

• Median prices increase 5-6% in 2015• Interest rates historically low until midyear

– Should start rising to about 5% by years end• Jobs opportunities will continue to grow• Distressed sales will continue to fall off• Affordability will continue to decline

Thank You

Reno/Sparks Association of REALTORS®5650 Riggins Court, Reno, NV

775-823-8800www.rsar.net