Building permits up 15 percent

This blog’s own Mike McGonagle was quoted in an article in today’s RGJ. Check out the story here Lower land, materials costs spur new home construction.

According to the piece, new home construction in Washoe County is starting to show some signs of life with building permits up 15 percent Y-o-Y.

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About Guy Johnson

I am a licensed Nevada REALTOR® living and working in Reno, Nevada. Give me a call at 775-722-4011. My team and I will be happy to assist you with your real estate needs.
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13 Responses to Building permits up 15 percent

  1. Avatar skeptical says:

    Just what Reno needs, more housing supply….NOT!

  2. Avatar Carleton says:

    Probably going to be looking at 400-450 REOs per month in the next few months. Maybe more.

    So yes, Skeptical, hard to see how how builders starting to turn out new inventory is going to help resales.

  3. Avatar billddrummer says:

    I think it’s great that builders are building again.

    Sarcasm off.

  4. Avatar smarten says:

    So if the cost to buy is lower than the cost to build, why, why is anyone paying for/taking out a building permit?

    FWIW, there are a couple of residential construction projects in process in IV; the first active ones I’ve seen in over a year. Something must be happening.

  5. Avatar DownButNot Out says:

    Smarten – I’m not convinced the price to build is more than the price to own. IMO costs have come down so much that you can build a new house for about the same or less cost/sf than what they’re currently selling at. I imagine most people would rather have a brand new house than a 5-30 year old house if the cost was comparible.

    My guess is they start the building process hoping to time next years market. If they want their product out next spring they’re right on schedule.

    It still seems like a gamble to me, but maybe it beats sitting idle if the only you know is how to build.

  6. Avatar inclinejj says:

    Smarten

    The big boys or someone doing some spec house?

  7. Avatar Perry says:

    I think the other factor is even though the inventory looks to be priced well so much of it is short sale. Not everyone wants to wait six months only to have the sale fail. Most of the REO’s that are priced well have competition and sell quick.

    Guy how much inventory is priced around $100sq’ regardless of size without a pending offer that is a clean quick close sort of sale?

  8. Avatar DonC says:

    The other factor favoring home builders is that resales may not be priced competitively as owners decide to “wait out” the downturn. Seems like there are a lot of houses on the market at prices not consistent with what has sold in the last year. This unrealistic pricing may get worse as people conclude (correctly) that the recession is over and (incorrectly) that prices will soon move sharply upward.

  9. Avatar smarten says:

    I’d say about 50%-50% between spec/owner occupancy. Given the cost to build; economy; state of the real estate/mortgage markets; does someone know something the rest of us don’t?

    Let me give an example. Ira Rodman is a very high end IV SFR builder. He builds homes [for spec] in a very distinctive “Tahoe” craftsman type design priced at in excess of $5M. For the last couple of years Ira has had two of his homes for sale; one on Crossbow priced at $5.25M, and the other on Champagne priced at a little under $7M. Well about 4 months ago the home on Crossbow was quietly removed from the MLS. Word has it Ira accomplished a private sale. And last week the home on Champagne went into escrow.

    And about 5 months ago IRA started construction on his latest offering – this one around the corner from his Crossbow home on Eagle.

  10. Avatar Guy Johnson says:

    Perry, out of the current 959 non-pending, non-short sale Active listings throughout Reno-Sparks, 139 are priced at less than $102/square-foot.

  11. Avatar SmartMoney says:

    Hmm, don’t see any evidence of 521 Cross Bow being sold,county records don’t show a transfer of title, and it’s still for sale on Zillow. It’s a $3 million house at best, only dirt for brains would pay what he’s asking.

  12. Avatar smarten says:

    Smart –

    Word has it that Sandra Marx was the money person behind construction of Cross Bow. Sandra also owns 794 Tyner that was constructed by the very same Ira Rodman. Cross Bow is no longer listed for sale on the IV MLS [also, go to zillow.com and under the details section for this property, you will see that the listing was “removed” on 10/5/2009]. Tyner is currently listed [MLS #938884] at $2.785M. You might want to read between the lines.

  13. Avatar billddrummer says:

    To SmartMoney,

    Perhaps it’s in escrow, not sold yet. You’re right about recordings–no transfer deeds since he purchased the lot.

    To Guy,

    Interesting that only 14% of listings are priced below $102/s.f., when most of the sales volume is in that price range.

    Are listing prices still sticky? The chart on the site says average listing prices are still well north of $300,000, yet the median sales price is $176,000.

    What’s going on here?

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