This week’s real estate headlines

national real estate headlines - 2014Here are a few national real estate-related stories that came across my screen this past week…

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Here come the new agents!

crowdWow! The number of new real estate licensees in Washoe County has grown more than 10 percent since the beginning of the year. According to the most recent real estate statistics from the Nevada Real Estate Division as of May 2015 there are 2,790 Active licensees in Washoe County. Compare this number to the 2,531 Active licensees reported in January of this year [See the first Table below]

This increase in new real estate agents equates to more than 50 per month. At that rate of growth we’ll be back to 2007 highs in about nine months. The highest number of Active licensees I see in the Table below since I’ve been tracking this number is 3,229 reported in August 2007. It’s likely we’ll surpass that number. Which begs the question can our local housing market sustain that many real estate agents?

The answer to that question requires some in-depth analysis of many factors (units sold, median price, sales volume, sales commission, etc.), and is a good subject for another blog post. In the meantime, a quick back-of-the-napkin calculation shows that in terms of units sold per agent, expect that number to decrease.

Since turning the corner in 2012 the Reno-Sparks market has been averaging ~6,900 residential sales1 annually over recent years; and thus far this year appears to be tracking the same:

  • 2012: 6,976 units sold
  • 2013: 6,891 units sold
  • 2014: 6,794 units sold
  • 2015: 3,203 units sold (to date 6/23/2015)

Using 6,900 annual sales, equates to 13,800 transaction sides annually. [Each sale typically has two agents involved; one on the buyer side and one on the seller side.] With 2,790 current Active licensees that comes out to 4.9 transactions per agent this year. Compare that to last year when the roughly 2,450 licensees averaged 5.5 transactions per year. What will happen next year if the increase in the number of agents continues at it’s current pace? Without a corresponding increase in the number of sales, the projected 3,200+ licensees will average only 4.3 transactions per agent.

Now, of course, not all new licensees will have the same number of sales. The Pareto principal [a.k.a. “80-20 rule”] definitely applies to real estate sales. Skill set and success aside, many new licensees simply choose not to be full-time real estate agents. Some will be part-time and some will hold a license only for a referrals basis.

Again, without performing a more detailed analysis, it’s safe to say the local real estate agent arena is going to get a little more competitive. Welcome to the exciting world of real estate sales, new agents!

1The unit sales data reported covers the cities of Reno, Nevada and Sparks, Nevada [NNRMLS Area #100]. Residential data includes Site/Stick Built properties and Condo/Townhouse only. Data excludes Manufactured/Modular and Shared Ownership properties. Data courtesy of the Northern Nevada Regional MLS – June 2015. Note: This information is deemed reliable, but not guaranteed.

Historical licensee numbers can be found in the Tables below for both Washoe County as well as the entire state.

Active Inactive Total
Washoe County Licensed RE Agents and Brokers
May 2015 2,790 710 3,500
January 2015 2,531 659 3,190
August 2014 2,455 629 3,084
March 2014 2,431 601 3,032
November 2013 2,460 538 2,998
April 2013 2,490 543 3,033
September 2012 2,506 555 3,061
May 2012 2,517 587 3,104
January 2012 2,537 623 3,160
June 2011 2,574 699 3,273
February 2011 2,578 744 3,322
March 2010 2,644 803 3,447
November 2009 2,737 779 3,516
September 2009 2,737 796 3,533
August 2009 2,725 817 3,542
March 2009 2,770 1,022 3,792
December 2008 2,888 1,001 3,889
September 2008 2,791 1,011 3,802
June 2008 2,984 1,085 4,069
January 2008 3,104 1,142 4,246
October 2007 3,176 1,134 4,310
August 2007 3,229 1,137 4,366
June 2007 3,221 1,237 4,458
April 2007 3,166 1,304 4,470

 

Active Inactive Total
Statewide Licensed RE Agents and Brokers
May 2015 20,984 5,275 26,259
January 2015 20,544 5,020 25,564
August 2014 20,403 4,671 25,074
March 2014 19,710 4,101 23,811
November 2013 19,484 3,937 23,421
April 2013 19,719 3,704 23,420
September 2012 19,832 3,642 23,474
May 2012 19,925 3,855 23,780
January 2012 19,987 4,264 24,251
June 2011 20,395 4,861 25,256
February 2011 20,744 5,276 26,020
March 2010 22,139 5,652 27,791
November 2009 22,612 5,802 28,414
September 2009 22,865 5,943 28,808
August 2009 22,920 6,066 28,986
March 2009 23,466 7,448 30,914
December 2008 24,327 7,457 31,784
September 2008 23,814 7,345 31,159
June 2008 25,986 7,518 33,504
January 2008 26,997 7,470 34,467
October 2007 28,115 6,970 35,085
August 2007 28,548 6,988 35,536
June 2007 28,763 7,418 36,181
April 2007 28,886 7,723 36,609

Source: Nevada Real Estate Division

Related post: Washoe County real estate licensees increase for the first time since the collapse of the housing bubble

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A few of my recent Facebook posts

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In addition to posting on this blog, I also maintain a Facebook Page where I post daily content. A few of these recent FB posts follow. Feel free to Like my FB Page to see these posts as I post them.

Nice story on Reno from Bloomberg.#TeslaEffect #Tesla

Posted by Guy Johnson, Keller Williams Group One, Inc. on Monday, June 22, 2015

ICYMI: a list of every position at the new Tesla Gigafactory and how to apply.#Tesla #TeslaJobs

Posted by Guy Johnson, Keller Williams Group One, Inc. on Thursday, June 18, 2015

Switch is funding the half-million-dollar interior build-out of the University of Nevada, Reno's InNEVation Center in…

Posted by Guy Johnson, Keller Williams Group One, Inc. on Wednesday, June 10, 2015

Check it out — Nevada ranks 10th in the Nation in startup activity. ICYMI Nevada's new ranking is up from 21st this time last year.#StartUp

Posted by Guy Johnson, Keller Williams Group One, Inc. on Tuesday, June 9, 2015

ICYMI Thrillist.com did a fun piece on downtown Reno comparing it to Brooklyn NY. Check out "A New Yorker's Guide to Reno" below.

Posted by Guy Johnson, Keller Williams Group One, Inc. on Monday, June 8, 2015

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RSAR Monthly Market Report – May 2015

The Reno/Sparks Association of REALTORS® has released its Sparks and Reno real estate market report for May 2015. Click on the report below to access the entire report.

rsar-market-report-2015-05

From May’s report…

“Homebuyers who have been on the sideline should consider making a move to buying a home soon before interest rates get too high,” said Dave Hansen, 2015 president RSAR. “Mortgage rates are showing signs of inching up. The 30-year fixed-rate mortgage is up almost a half of a percentage point since mid-May, averaging about 4.125 percent. Economists had predicted we would begin to see an increase in interest rates by mid-year and they appear to be right.”
May 2015 median price was up 4.7% to $284,900 compared to $272,000 in April 2015 and up 18.7% compared to $240,000 in May 2014.

related post: RSAR Monthly Market Report – March 2015

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Last week’s real estate headlines

national real estate headlines - 2014I was camping this past weekend so my weekly post of real estate headlines is a bit tardy.

So here are a few national real estate-related stories that came across my screen last week…

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FCT’s Market Condition Report – May 2015

Our friends at First Centennial Title have released their Market Condition Report for the Reno, Nevada area for the month of May. (Click on the report below to enlarge.)

FCT May 2015 Market Condition Report

Nothing but green. Green tinted cells signal tight markets — from a Ratio of Supply to Demand standpoint — in the specified areas. All other things being equal, the smaller the Ratio of Supply to Demand, the tighter the area market.

Reno’s Ratio of Supply to Demand value of 1.8 is up slightly from last month’s 1.7 number, however remains extremely low. Sparks’ Ratio of Supply to Demand value of 1.2 is up slightly from last month’s 1.0 number, and also remains extremely low.

Also noteworthy is the difference between the median “in escrow” price and the median closed sales price report for the areas. The May report shows that Reno properties exhibit a median “in escrow” price of $293,000 and a median closed sales price of $288,000. This difference of only $5,000 indicates that properties are selling at only a 1.7 percent discount.

related post: FCT’s Market Condition Report – May 2015

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May median sales price, units sold, DOM and inventory

monthly median 2015-06-06May’s median home sales price for the Reno-Sparks real estate market jumped 4.7 percent for the month to come in at $284,900. $284,900 is an 18.7 percent year-over-year increase over May of last year. The last time our market saw a median as high as $284,900 was in February 2008 — more than seven years ago.

May’s median sold price per square foot (ppsf) came in at $152.94/sq.ft. — a 1.4 percent one-month increase over the $150.85/sq.ft. seen in April; and a 12.1 percent year-over-year increase over the median ppsf in May 2014.

The number of homes sold in May was unchanged from the number sold in April. May’s 567 houses sold represents a 3.8 percent year-over-year increase over the 546 sold in May 2014. Home sales continue to be robust.

May shaved off a few more days from the median days on market (DOM) number. The current median DOM is at 52 days. Compare this number to last year’s when the median DOM was 65 days — nearly a two-week difference.

For the 3rd consecutive month available inventory has risen. [That is a good thing.] After having declined every month since August 2014 available inventory in the Sparks and Reno real estate markets finally turned the corner in April of this year. Currently, 930 houses are available for sale — up 18.5 percent over April’s 785 houses for sale. However, available for-sale inventory remains low. May’s number is down 13.6 percent from this time last year.

Pending sales are also up. May’s 1,129 pending sales are up 2.5 percent over April’s pendings and is the highest number of pendings since May of last year.

May sales by type break out as follows:

  • REO sales: 4% – down from April’s 5%
  • Short sales: 5% – down from April’s 6%
  • Equity sales: 89% – up from April’s 87%

Distressed sales now make up less than 10 percent of the monthly sales.

May sales by price band break out as follows in the table below…

sales price ($000’s) units sold cumulative % of sales
0 – 99 6 1.1%
100 – 199 83 15.7%
200 – 299 224 55.2%
300 – 399 144 80.6%
400 – 499 46 88.7%
500 – 599 20 92.2%
600 – 699 13 94.5%
700 – 799 4 95.2%
800 – 899 8 96.6%
900 – 999 2 97.0%
1M+ 17 100%
total 567

A whopping 17 homes sold for over $1M in May. I can’t recall the last time that many $1M+ homes sold in one month. To put that number in perspective, last year the total number of $1M+ sales was 77 – or an average of 6.4 per month.

Also noteworthy, May saw the sale of 2500 Manzanita for $8,000,000 — the highest sale for a residential property this year.

May’s median sold price for houses and condos combined was $266,170 — a 4.4 percent increase from April’s median sold price of $255,000 for combined sales of houses and condos.

The table below contains the past 13 months of data…

Month Year # Sold Median Sold Price Sold Price per Sq Ft Median DOM # of Actives # of Pendings
May 2015 567 $284,900 $152.94 52 930 1,129
Apr 2015 567 $272,000 $150.85 57 785 1,101
Mar 2015 550 $272,195 $149.02 59 715 1,027
Feb 2015 395 $265,000 $143.43 75 630 1,044
Jan 2015 363 $252,000 $140.12 85 706 933
Dec 2014 518 $261,990 $139.98 78 806 789
Nov 2014 473 $260,000 $138.51 70 940 977
Oct 2014 490 $260,000 $140.04 73 1,083 1,075
Sep 2014 507 $239,000 $136.90 70 1,325 999
Aug 2014 578 $250,000 $138.38 60 1,390 1,015
Jul 2014 530 $249,950 $140.26 61 1,365 1,117
Jun 2014 564 $250,000 $135.97 61 1,234 1,098
May 2014 546 $240,000 $134.60 65 1,076 1,190

Note: The medians table above is updated on a monthly basis. The median home price data reported covers the cities of Reno, Nevada and Sparks, Nevada [NNRMLS Area #100]. Residential data includes Site/Stick Built properties only. Data excludes Condo/Townhouse, Manufactured/Modular and Shared Ownership properties. Data courtesy of the Northern Nevada Regional MLS – May 2015. Note: This information is deemed reliable, but not guaranteed.

Click here for historical data back to 1998.

Related post: April median sales price, units sold, DOM and inventory

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This week’s real estate headlines

national real estate headlines - 2014Here are a few national real estate-related stories that came across my screen this past week…

Posted in headlines, News | Tagged | Leave a comment