This week’s real estate headlines

Here are a few national real estate-related stories and news pieces that came across my screen this past week…

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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 on the Reno, Sparks, Incline Village, and northern Nevada real estate market, economy, and other related topics.

Below are a few recent posts from my Facebook Page.

To see my Facebook posts in real time as I post them please Like my FB Page

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Washoe County home sales by zip code

One of this blog’s most frequently searched-for topics is “home sales by zip code”. As such, each January, I post an analysis of the prior year’s home sales broken out by zip code.

It’s that time of year again, but before we dive in, here are some aggregate numbers for Washoe County, Nevada: 2019 saw 7,877 homes (both condos/townhomes and houses) sold county-wide. These home sales exhibited an overall median sales price of $372,000. Unit sales were up 5.5 percent year-over-year, and the median sales price was up 3.6 percent year-over-year — resulting in an increase in 2019 total sales volume of 6.9 percent over 2018’s.

Now, without further ado, let’s take a look at Washoe County’s 2019 home sales by zip code.

Number of Homes Sold

Of the 22 zip codes reported on in this analysis, just three accounted for nearly one-third of all home sales in 2019. And just five accounted for nearly half of all units sold.

89436 (Wingfield Springs) in Sparks, Nevada took the top spot with 985 home sales in 2019. 89521 (South Meadows) in Reno took the 2nd spot — with 855 homes sold; followed by 89506 (Stead/Lemon Valley/Golden Valley) with 709 unit sales.

The chart below shows the top zip codes in terms of unit sales. The top-four rankings are unchanged from last year.

Greatest increase in units sold

I typically don’t report this metric, but this year one zip code jumped out in terms of year-over-year increase in units sold. 89439 (Verdi) saw an unprecedented 368 percent increase in home sales in 2019 — jumping from 19 homes sold in 2018 to 89 homes sold in 2019.

Taking a closer look at Verdi’s 2019’s sales revealed that more than two-thirds were new home sales through the new developments being built there.

The zip code with the next best increase in units sold was 89433 (Sun Valley) with a 22 percent year-over-year increase.

Highest Median Sales Price

Not surprisingly, it was the Lake Tahoe zip codes that exhibited the highest median sales price. 89402 (Crystal Bay) took the top spot with a median sales price of $1,784,500. 89451 (Incline Village) came in 2nd with a median sales price of $848,000.

In Reno, Nevada, the top zip codes were 89511 (Montreux, ArrowCreek, Saddlehorn, et al) coming in 3rd with a median sales price of $697,000, followed by 89519 (Caughlin Ranch) with a median of $625,000.

The chart below shows the top zip codes ranked by 2019 median sales price.

Lowest Median Sales Price

89512 (Reno – North) exhibited the lowest median sales price in the county in 2019 — with a median home price of $231,000. 89442 (Wadsworth) had the 2nd-lowest median — with $240,000 for the year; followed by 89431 (Sparks) with a median of $270,000.

The chart below shows the zip codes with the lowest median sales price in 2019. For reference the Washoe county-wide median was $372,000.

Home Price Appreciation

In 2019, median sold home prices in Washoe County increased 4.8 percent overall year-over-year. However, this increase was not uniform across all zip codes. In fact, some zip codes saw a decrease in 2019’s median sales price compared to 2018’s (see the Data Set below).

89441 (Spanish Springs – West) took the top spot this year with an impressive 11.8 percent increase in its 2019 median sales price over 2018’s. In a very close 2nd-place was 89402 (Crystal Bay) with an equally impressive 11.7 percent appreciation; followed by 89451 (Incline Village) with a 9.6 percent growth.

The chart below shows the top zip codes in terms of year-over-year median sales price increase.

The Data Set below contains metrics for all 22 zip codes, including a column showing the highest priced home sale for each zip code.

Are there other housing market metrics you would like to see by zip code? Do you have questions/comments regarding the above? Please let me know in the comments below.

And, as always, thank you for reading the Reno Realty Blog.


Data Set

The table below shows the data for all Washoe County zip codes used in this analysis. [Click on the column headers to sort by that column.]

Methodology

Washoe County, Nevada encompasses 41 zip codes, however many of these zip codes are for P.O. boxes only and contain no homes. The analysis above applies to only those zip codes containing homes. Data in the charts and tables covers both site/stick built and condo/townhouse sales in Washoe County, Nevada for the 2019 calendar year. Data excludes manufactured/modular homes.

To see all the zip codes within Washoe County, Nevada click here.

For an interactive zip code boundary map for Washoe County click here. Use the + and – buttons to zoom in and out, respectively, on the map.

Note: The home price reported above covers the zip codes of Washoe County, Nevada. Residential data includes Site/Stick Built and Condo/Townhouse properties only. Data excludes Manufactured/Modular and Shared Ownership properties. Data courtesy of the Northern Nevada Regional MLS (as January 22, 2019), and the Incline Village REALTORS® Matrix system (as of January 25, 2019). All information herein is deemed reliable, but not guaranteed.

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Housing market forecast 2020 for Incline Village, Carson City and other norther Nevada markets

According to the latest CoreLogic Home Price Index (HPI®) Report: National home prices increased 3.7% year over year in November 2019 and are forecast to increase 5.3% from November 2019 to November 2020.

Recently I published a blog post where I attempted to forecast where Reno-Sparks home prices would be at the end of this year (2020). See Reno housing market forecast 2020

My methodology consisted of applying CoreLogic’s 2020 forecast for home prices nationally to the current median sales price for the Reno-Sparks market after adjusting for the relative difference in home price appreciation for Reno-Sparks compared to that of the U.S. [Again, see Reno housing market forecast 2020 for additional detail.]

Because many readers of this blog are also interested in home prices in other northern Nevada housing markets, I employed the same methodology to other area housing markets in order to derive 2020 forecasts for those markets.

The table below shows the results of that exercise (click on the table to enlarge).


Methodology

The table above contains data for housing markets surrounding the Reno-Sparks metro area. These markets include: Carson City, Dayton, Fernley, Gardnerville/Minden, and Incline Village. I also separated Reno and Sparks, and included data for each in the table.

For each market I reported the median sales price for the 12-month periods: December 2017 – November 2018; and December 2018 – November 2019. I chose time periods ending on the month of November in order to correspond with the time period reported on in the aforementioned CoreLogic report.

After determining the median sales price for each of the 12-month periods, I calculated the percent increase in median sales price appreciation for each of the markets in the table.

Given the rate of home price appreciation, I then calculated two home price forecasts for 2020 [see the last two columns in the table]. One forecast assumed a market’s identical rate of growth as observed in 2019; the other forecast utilized a revised (upward) rate of home price appreciation that was based off of CoreLogic’s projection for home prices nationally after adjusting for the relative difference in home price appreciation for Reno-Sparks compared to that of the U.S.

Forecasts / Findings

While the two forecasts [see the last two columns in the table] provide a range where the 2020 median home price for each market may land, it is the differences in home price appreciation observed across markets that is particularly noteworthy.

Dayton, Nev. saw the largest home price appreciation with a 10.2 percent increase in the median homes price in 2019 over 2018. After Dayton was Carson City, Nev. with an 8.1 percent increase in the median homes price in 2019 over 2018; followed by Fernley, Nev. with a 6.0 percent increase; followed by Incline Village, Nev. with a 5.7 percent increase in its median sales price over the same time periods. Each of these markets saw substantially higher rates of increase over Reno and Sparks 3.7 and 3.6 percent increases, respectively.

At the lower end of the appreciation scale was the Gardnerville/Minden market, which saw a 3.1 percent growth in home prices — below the national home price year-over-year appreciation of 3.7 percent for the same time period.


Is there a northern Nevada market in which you’re interested that I did not include? If so, let me know in the comments below.

Thank you for reading the Reno Realty Blog. – Guy

Posted in Agent Insights, Fernley, Incline Village, Market Trends, Reno, Sparks | Tagged , , , , , , , , , , , , , , , | 3 Comments

This week’s real estate headlines

Here are a few national real estate-related stories and news pieces that came across my screen this week…

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RSAR Market Reports for Reno, Sparks, and Fernley, Nevada – December 2019

The Reno/Sparks Association of REALTORS® (RSAR) has released December’s Market Reports for Reno, Sparks, and Fernley, Nevada.

The following infographics highlight each market’s housing numbers. Click on the infographics below to access the entire reports.

Reno infographic

Sparks infographic

Fernley infographic

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Is Reno, Nevada’s home price appreciation uniform across all price segments?

Earlier this week I published Reno-Sparks’ monthly housing market numbers for December 2019. In that blog post, I noted that December’s median sales price of $394,000 was up a healthy 7.95 percent year over year (YOY). I described the YOY price appreciation as “healthy” because that number was higher than the annual increase observed a year ago. [For context, December 2018’s YOY price growth was 5.79 percent. Therefore 2019’s home price appreciation was more than 37 precent higher than 2018’s. That’s remarkable.]

Reno’s appreciation compared to the nation

Providing additional context, from the latest CoreLogic Home Price Index (HPI®) Report: “National home prices increased 3.7% year over year in November 2019…” So, Reno-Sparks’ median home price annual gain of 7.9% in 2019 was more than double the rate of home prices nationally. Wow!

In fact, after ranking all fifty states in order of home price appreciation, only two states had annual increases in home prices greater than that of the Reno-Sparks market. Idaho had a 10.2 percent annual increase and Maine had an 8.6 percent annual increase. [Incidentally, as a whole, the state of Nevada saw home prices increase by 3.2 percent year over year in November — less than the national average.]

What market segments are seeing the biggest gains?

We know the Reno-Sparks’ market as a whole is doing well, but are these gains uniform across all price segments? The short answer is No.

If we drill down a bit deeper, some interesting observations are made.

I began the analysis by splitting December 2019 sales into quartiles (four equal parts) based off of closed sold price — with quartile 1 being the lowest prices sales and then progressing to quartile 4, the highest priced home sales.

I then did the same with December 2018’s sales data. Once I had both data sets split into their respective quartiles, I was able to calculate the sold price increase (or decrease) for the year for each quartile. The results are in the table below [click on the table to enlarge].

I found the data in this table to be very interesting. Looking at the last column, the median sales price of quartile 1 (the lowest priced home sales) actually saw a slight decline from a year earlier. The other three quartile each saw annual increases to their respective median sales prices.

While quartiles 2 and 3 each saw robust annual gains, it is quartile 4 (the highest priced home sales) that really skyrocketed. The median sales price of the homes in quartile 4 exhibited an annual increase of more than 16 percent!

Should we be surprised?

Upon observing the larger gains in the highest-priced homes segment, I was reminded that one year ago I published a blog post entitled Reno-Sparks luxury home prices skyrocket in 2018.

In that January 2019 blog post I wrote, “The luxury home segment is the fastest growing segment in the Reno-Sparks market.”

The data compiled above shows the 2019 luxury home market outperformed as well. Is this a precursor to 2020? I believe so.

Reno-Sparks Median Home Price Appreciation by Quartile (December 2019)


As always, I thank you for reading and I welcome your comments below.

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Reno housing market forecast 2020

As a REALTOR®, “How’s the market?” is probably the question I get asked most frequently. And, “Where are home prices heading?”, is the second most frequently asked question.

Though the first question is always easily answered, the second question presents more of a challenge. There are so many factors to consider (e.g. the economy, job growth, mortgage rates, housing inventory, buyer demand, seller demand, and many more) in formulating an answer that it becomes difficult to predict.

When answering, I utilize a trusted source’s prediction for the nation’s housing market and then apply it to the Reno-Sparks housing market in order to derive a forecast for 2020.

Yesterday, I read CoreLogic’s latest Home Price Index (HPI®) Report. In their report, CoreLogic stated, “National home prices increased 3.7% year over year in November 2019 and are forecast to increase 5.3% from November 2019 to November 2020.” This statement provided me a starting point for my analysis.

Why CoreLogic?

From CoreLogic’s website, the firm has national property data spanning 50+ years, and they tout a 99.5% accuracy standard (see the screenshot below). Frequent readers of this blog know that I often link to CoreLogic’s reports.

Deriving a 2020 forecast Reno, NV

My methodology for applying CoreLogic’s 2020 prediction to the Reno real estate market is to first look at our market’s median home price year-over-year gain during the same period reported on in the CoreLogic report – specifically, from November 2018 to November 2019. So, let’s begin…

November 2018’s median closed sales price for the Reno-Sparks’ market was $377,250. One year later, November’s median home price has risen to $400,000 — representing an annual increase of 6.0 percent.

Comparing that increase to the nation’s average home price appreciation (3.7%) for the same time period shows that Reno’s increase was 63 percent greater than the national average. That’s remarkable!

Assumption

For 2020, CoreLogic predicts national home prices to spike 5.3% from November 2019 to November 2020. If we make the assumption that Reno home prices will again outpace the national average by the same degree that they did in 2019, we can then increase CoreLogic’s prediction by 63 percent when applying theirs to the Reno housing market. Doing so yields an 8.64 percent (5.3% X 1.63) appreciation.

As stated previously, November 2019’s median sales price for Reno-Sparks was $400,000. Applying a projected price appreciation of 8.64 percent to that median price yields $434,556.

So, if this methodology is correct, then Reno-Sparks median sales price should increase to $434,556 by November 2020.

Thoughts?

What do you think? Is a $434,000 median sales price in 2020 realistic?

I would love to hear your thoughts on what you think the median sales price will be at the end of this year. Please leave your comments below.


Thank you for reading the blog. Much appreciated!

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