March was a month of contrasts. While the $1-2 million range weathered a noticable price drop, the over $2 million range saw a dramatic increase in closings. As prices softened in the $500K-$1 million range, the under $300K market strengthened on all fronts. The average overall Reno-Sparks residential sale went from $353,260 in February to $381,012 in March. Yet current pendings are off slightly from last month at this time. read it
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Reno Ignoramus
This post very clearly demonstrates Reno’s affordability problem. The hottest segment of the market is the bottom of the market, the below $300K price range. So in this segment the average selling price was $218,524. Did you notice that happens to be almost $150,000 BELOW THE MEDIAN??
In the $300K-$500K category, selling prices are down. Now I am just an Ignoramus, but I have a question about inventory in this category. Your post says in this category there were 642 listings for March. But when I go to your website and search the MLS in the $300K-$500K category for all of Reno and Sparks, I get 1,582 listings. What’s the difference?
In the $500K -$1 million segment, prices are down and inventory is up.
In the $1 million – $2 million segment, prices are down and inventory is up.
In the $2 million category, well, who cares? I’m sorry, but for most of us out here blogdom, a house priced at $2 million or more is like a car priced at $100,000. Nice, but personally irrelevant. All those numbers do is wratchet up the averages so it looks like overall prices are rising when in fact they may not be.
Pending sales are down in all categories.
You say April may be “softer” than March. I’m just an Ignoramus, and don’t always understand realtorspeak. Do you mean prices may continue to drop and invenory to grow? Except, of course, at the very bottom of the market?
Also, could you tell us what the median price was in March for all homes sold? The sale of even 2 or 3 houses for $2 million plus can skew the average.
Diane Cohn
Dearest Ignoramus, the 1582 listings you found represent all of Northern Nevada, while the 642 listings I focus on are in Reno-Sparks proper.
Softer is realtorspeak for, sales probably won’t be as numerous as the prior month and maybe the prices will fall a bit, but I don’t really know because I’m not a fortune teller or an empath (too bad).
The super high end is interesting to watch as it often moves contrary to the regular market. In many markets, it is considered a long term leading market indicator.
The median price in Reno Sparks for March was $313,500 with a low sales price of $85,000 and a high of $2,750,000.
Reno Ignoramus
What an interesting month March appears to have been. The AVERAGE sales price was $381,012, but the MEDIAN sales price was $313,500. Wow! A difference of $67,512. Boy, those 2 or 3 high end sales from the top 1% of the market sure skew the average, don’t they?
So,lets see: the median was $313,500? I note that on March 21, in your most excellent post on Reno’s affordability problem, you said the median was approximately $365,000. Does this mean that the median price fell $51,500??
If the median price of a home in Reno fell $51,500 in one month, then one of two things is true. Either:
1) The price of houses in Reno is falling through the floor, or
2) March was a strange month.
Even an Ignoramus knows that it is unwise to make too much out of one month’s results. We need to look at trends, right?
Could you tell us out here in blogdom what the median was on December 31? And what it was as of September 30 of last year? And maybe June 30 of last year? Well, maybe we could just start looking at YoY statistics. What was the median on March 30 last year?
Reno Ignoramus
Perhaps an Ignoramus can’t work the MLS thingy correctly. When I go to the MLS link on your wonderful website and search in the $300K-$500K category for the whole thing, which I assume would be “all of Northern Nevada”, I get 2,340 listings! When I search in the same category for just “All Reno” and “All Sparks”, I get 1,609 listings. (Which happens to be 27 more listings than when I went there 2 days ago.)
I don’t know, I’m just an Ignoramus, but it seems to me that a fair representation of houses on the market in any price range for Reno and Sparks would be found under “All Reno” and “All Sparks.” Is “Reno-Sparks proper” realtorspeak for something other than all of Reno and Sparks? How far down do you have to carve it to get to just 642 listings? Where did the other 1,000 listings go?
But then, even an Ignoramus can understand that it sounds better to say that 27% of 642 listings sold than 27% of 1,609. Because that would mean if you are a seller in that price range, you don’t have a 1 in 5 chance of selling your house, you have about a 1 in 10 chance.
And that might mean that maybe you ought to serioulsy consider dropping your price. But that is another story, right?
Reno Ignoramus
Sometimes an Ignoramus is really bad at math. At least realtormath. If 27% of 642 listings in a particular price range (like $300K-$500K) sold in one month, that would mean 173 houses sold. But if there were really 1,600 listings in that price range, and 173 sold, then that would mean only 11% of the listings sold. So it really is 1 out of 10, isn’t it?
Now I guess if we just eliminate 1,000 of those listings from our dataset, as, say, not being in “Reno-Sparks proper”, then we can get to 27% and 1 in 5. Is that how it works?
I know I do not often understand realtorspeak, and now I have to learn realtormath too.
Diane Cohn
Okay, so I’m pulling out the March data sheet I printed to try and figure out the discrepancy here. And I think I’ve found it.
I have a data field that doesn’t show on the website… it’s called Total Listed. Total Listed tells me how many homes were listed in a given timeframe, in this case, March. So, out of 642 homes listed in March in the $300K-$500K price range, 174 sold. In fact, Ignoramus is correct that (on my sheet anyway) 1621 properties total were listed as of April 1, 2006, which includes all the dead weight from prior months. Which means, the odds of selling are indeed worse when you look at it this way.
Why do I focus on new listings during a given period? Because I focus on sales during the same given period, March. I’m looking at snapshot of March. Homes listed, homes sold. I think it gives a clearer picture of the dynamics month to month. Nonetheless, I will take this conversation to the Jedi Masters of real estate just to be sure, because I certainly don’t want to misinform. Clearly I must pay closer attention to semantics.
My apologies to Ignoramus for a hasty first reply. Obviously I didn’t look closely at the first part of his question regarding the total number for sale and just made a quick assumption without really delving into it.