After reading the comments to Diane’s February 5th Dear Arterra: post, I thought I would attempt to address the common thread running through the responses; namely, just what kind of prices does the downtown Reno condo market currently support?
To get an idea, I pulled recent Solds and current Pendings (under contract) for the various condo projects downtown. When available, the Actives (those presently listed for sale) were pulled as well. Additionally, I included Average DOM (days on Market) for the Solds. Although complete sales data is not available for all the downtown condo projects, the data that is available yields a pretty good picture of what’s going on downtown at the moment. Note: I’ve listed the condominium projects in order of increasing $/sq ft.
Village at Idlewild Park (1450 Idlewild Drive)
| Sold Properties | 2006 | 2007 | Pendings |
| Total # of Listings | 23 | 6 | 19 |
| Lowest Sold Price | $170,000 | $194,735 | $175,000 |
| Average Sold Price | $237,839 | $223,494 | $240,310 |
| Median Sold Price | $248,660 | $204,900 | $246,400 |
| Highest Sold Price | $292,225 | $286,530 | $285,900 |
| Average $/Sq Ft | $271 | $246 | $261 |
| Average Days On Market | 187 | 302 | 274 |
Riverwalk (200 West 2nd Street)
Active Properties
| Total # of Listings | 7 |
| Lowest Asking Price | $134,500 |
| Average Asking Price | $303,471 |
| Median Asking Price | $320,000 |
| Highest Asking Price | $485,000 |
| Average $/Sq Ft | $337 |
For the Riverwalk project I found only one resale unit on the MLS. This unit sold on 12/4/2006 for $355/sq ft. There were no Pendings.
Arlington Towers (100 North Arlington Avenue)
Active Properties
| Total # of Listings | 9 |
| Lowest Asking Price | $169,900 |
| Average Asking Price | $302,577 |
| Median Asking Price | $235,000 |
| Highest Asking Price | $469,900 |
| Average $/Sq. Ft. | $388 |
| Sold Properties | 2004 | 2005 | 2006 | 2007 |
| Total # of Listings | 18 | 11 | 10 | 2 |
| Lowest Sold Price | $89,000 | $142,000 | $143,000 | $205,000 |
| Average Sold Price | $160,072 | $267,454 | $322,690 | $502,500 |
| Median Sold Price | $136,000 | $217,000 | $278,500 | $502,500 |
| Highest Sold Price | $325,000 | $450,000 | $720,000 | $800,000 |
| Average $/Sq Ft | $238 | $315 | $333 | $401 |
| Average Days On Market | 41 | 49 | 87 | 102 |
There are two Pendings at Arlington Towers: $345/sq ft and $307/sq ft
The Park Tower Condominiums (280 Island Avenue)
Active Properties
| Total # of Listings | 8 |
| Lowest Asking Price | $255,000 |
| Average Asking Price | $533,525 |
| Median Asking Price | $335,000 |
| Highest Asking Price | $999,000 |
| Average $/Sq. Ft. | $394 |
| Sold Properties | 2004 | 2005 | 2006 | 2007 |
| Total # of Listings | 9 | 16 | 7 | 1 |
| Lowest Sold Price | $45,000 | $125,000 | $132,000 | $148,000 |
| Average Sold Price | $140,333 | $263,031 | $244,714 | $148,000 |
| Median Sold Price | $127,500 | $232,750 | $160,000 | $148,000 |
| Highest Sold Price | $207,000 | $572,000 | $380,000 | $148,000 |
| Average $/Sq Ft | $209 | $310 | $320 | $346 |
| Average Days On Market | 165 | 103 | 58 | 203 |
Also one Pending for $400/sq ft
The Montage (255 North Sierra Street)
Active Properties
| Total # of Listings | 6 |
| Lowest Asking Price | $215,000 |
| Average Asking Price | $384,166 |
| Median Asking Price | $377,500 |
| Highest Asking Price | $565,000 |
| Average $/Sq Ft | $424 |
No Solds and no Pendings found.
Palladio (50 North Sierra Street)
Active Properties
| Total # of Listings | 21 |
| Lowest Asking Price | $363,150 |
| Average Asking Price | $695,772 |
| Median Asking Price | $730,000 |
| Highest Asking Price | $1,005,000 |
| Average $/Sq. Ft. | $492 |
For the Palladio I found two Pendings: $457 and $546/sq ft
I realize I’ve presented a lot of data here. I welcome your thoughts and conclusions. It looks like the Arterra will be priced along the lines the Montage and the Palladio. The question remains can all this inventory be absorbed, and at what price? I’ll be monitoring the downtown condo prices, especially the Pendings I mentioned above, and posting periodically.
Data courtesy of NNRMLS February 2007.
Posted by Guy Johnson.
Grand Wazoo
Thanks very much for this data, Guy. Next time you run the numbers, please also include the median pricing data – your Statistics 101 professor will tell you the median price is as essential or more so than the average price to get a true feel for the market.
I look forward to your future contributions.
Guy Johnson
You are correct, Grand Wazoo. Thank you for the tip.
EyesWideOpen
Hey Guy: Great start to your blog and many thanks for the insider look at the condo data. I look forward to your posts.
The wife and I have been closely watching downtown Reno condos since May. A few weeks ago the Village at Idlewild Park offered us 15% off the unit we most desired. So we’re one of those 19 pendings listed in your data.
We’re very fond of the Riverwalk tower as well (we currently rent there), but the taxes are higher and the HOA fees are much higher, especially since they raised them 50% for 2007. That’s no typo: 50%! And I thought the 13% that Arlington Towers raised was high. When considering the taxes and fees into the overall value, I think the V@IP is a far better value and the location is simply fabulous. We have grandkids in Reno and living across the street from a regional park is a big plus.
EyesWideOpen
BanteringBear
Welcome, Guy. Thanks for the info. There is one question that all of the sales data in the world cannot answer. Are these units being purchased for speculation, or as residences? This has been a large part of the problem the last several years. Artificial demand. As has been evidenced across the country, high end condo projects were attractive as short term investment flips where the “owner” never intended upon living in them, or even renting them. They would oftentimes even sell the contract before the place was completed. Those days are, by and large, over with. Long term, the fundamentals will dictate pricing. These fundamentals are largely based on local economic conditions. When you consider local wages, the prices at Arterra are laughable. Obviously, Arterra is not for first time buyers, or average wage earners for that matter, but these local wages directly impact what is possible with the higher end. As the price per square foot on the lower end falls, so does the higher end. Arterra’s pricing per square foot is the highest ever seen in the area for a product not yet completed, and at a time when prices have been dropping steadily for months. This greatly affects what the units true “market value” is. For example, I know of a particular house, in the older Southwest off of Skyline on a shy half acre lot, listed at $549,000. At roughly 3300 square feet, that amounts to ~ $167 per square foot. Then, consider Arterra is asking over $550 per square foot. The disconnect is obvious. And historically, condos are cheaper than houses per square foot. This is because homes include land. With condos, you have no land. And, the price per square foot does not even include the HOA fees every month which makes the units even more expensive. The bottom line is, Arterra is grossly overpriced for the area. Paying those prices, especially in a depreciating market, would be foolish to say the least.
Reno Ignoramus
Thanks Guy for the info. I am wondering if you could post some info about what the HOA fees are at these various condo developments. Perhaps Eyes could share whatever info he might have.
Guy Johnson
Reno Ignoramus, I was thinking of the same thing [HOA fees] this afternoon. I’ll do a little investigating and post what I find.
Perry
Hello Guy,
Welcome and thank you for the information regarding the condo’s downtown.
My wife and I have been very interested in the downtown area but have yet to see something that makes sense economically.
We went to an open house at the Park Tower today and when I commented about the price verses wage issue I was rebutted with, most of our downtown buyers are from California and therefore the prices are justifiable. I find this attitude offensive.
In order for downtown to be a success, someone has to live down there. I’m talking about someone with a job. Someone who will eat out, have an ice cream, and take in a movie. Someone who will support business downtown and make it a place people want to be. If the “we sell to Californians” attitude continues downtown will not thrive. Part timers and flippers do not grow a community.
When you look in other cities (Portland, Chicago, San Diego) you can find products for most price points. Reno developers are only concentrating on the high profit high end. Check out this site for San Diego http://www.sandiegodowntown.info/downtown.html
I wouldn’t exactly call San Diego affordable but there is definitely variety and selection.
The Belvedere is close to offering something for those in the middle, but I think you give up too much to live there. They were non committal about the parking for the low rise section. Further there is no outdoor space on most and you can’t even open the window other than the vent.
I guess we’ll continue to watch and wait for now.
EyesWideOpen
2007 HOA fees:
1 bedroom, Arlington Tower:
$415/month
1 bedroom, Riverwalk Tower:
$335/month
1 bedroom, Village at Idlewild Park:
$185/month
1 bedroom, Park Tower (2006)
$330/month
Reno Ignoramus
Perry:
About a year ago, a condo at Park Tower came on the market at something like $1.1 million. I thought that was rather astounding for Reno, and so I went to look at it. I started talking to the realtor and pointed out that if one were to put down 20%, or $220,000, one would be looking at about $5,400 a month just for P&I on the $880,000 30 year amortizing loan. I asked what the condo fee was and he said it was “about $1,000” a month. So I said, gee, P&I and taxes and insurance and the HOA fee would come in north of $7,000 a month. I suggested that was pretty steep for downtown Reno living, especially in a 45 year old building fairly sparce on amenities.
The realtor, who I do not believe was the listing agent but was just “sitting in”, told me that there was major money coming into downtown Reno and suggested that if I could not run with the big dogs I ought to get off the porch. I have rarely encountered such arrogance. The irony of it all is that my sister was with me that day and, had she wanted to, she could have opened her checkbook and just written a check for the full price. She was totally put off by the condescending attitude.
I note that this unit, now a year later, is still on the market. The price appears to have been reduced by about $100,000 or so.
crazyowner
as the owner of one of the apartments specifically mentioned in your blog, i thought i would share my general agreement with all of you about the changes occuring in the market. in an effort to “price” my unit correctly, i am considering 1) palladio has 20 developer units unsold, probably available at preconstruction prices or lower, plus at least 10 flipper units available there or lower, depending on desperation of sellers, 2) montage tells me they have 40% pre-sales, and, even at that, we might look at their deposit contract and laugh as to whether those “buyers” will close, 3) montage construction lender Corus Bank is under termendous pressure from shorts because of deals like this, and could choose to pull the rug from this at any time, 4) i think the california buyer mystic is, slightly, valid, but you would have to be awfully patient to wait for one to appear if you were a seller, and 5) seems like 400 a foot is too high, wait for the high end to go to 300 neighborhood, and don’t buy anything unless you can see the seller in serious pain. at 300 a foot, none of these deals work, even for the construction lenders. these developers and flippers deserve to take a bath.
Reno Ignoramus
Crazyowner, I went into the sales office at the Montage last March and they told me at that time that they had “more than 50% presold with deposits.” Now they are saying 40% ? Interesting.
Do you have any word on the Paladio? I have occasion to be downtown about 2-3 days a week and it appears that work there has essentially ground to a halt. They have a 4 or 5 man workcrew on the entire project. From the street you can see that the sheetrock has been completed but the texture has not been applied to the walls. It has been like this for several weeks now. I know they have moved back the CofO date at least three times so far. Do you have any info?
Grand Wazoo
I ate lunch at Silver Peak (across the street from Paladio) yesterday and I agree there seems to be zero activity at the site. No work at all seems to be going on, the job site appears totally devoid of workers.
sean
Great posts!
I am one of those california buyers. I have not yet but am looking to. I was in Reno last summer. I liked the riverwalk project. I am glad i decided to wait though. I will be in town again in April to give it another look. Reno is a good investment if you are looking to live there as a primary residence.
The future holds the olympics. I have a place in Vancouver Canada. The 2010 olympics have brought added value to the property here. The fact is everywhere went up real estate wise over the last 6-8 years
London,San Diego,Sydney…it is global.
Second, coming from San Diego, Let me say California is EXPENSIVE! You will spend a half million and be disappointed at what you bought.
California is really full. Last year for the first time in a long time, more people left than came to California Many companies are looking to leave Calif. due to high costs many restrictions and so on,,,Obviously Nevada is a prime reciptent of this business migration
Water wise electrical grid capacities…it’s full. The growth will come in secondary, and tirtiary cities…i.e. Reno, Boise, Spokane, Laremy,Memphis,Milwaukee…I could go on, but you get the picture.
Where is Reno really going? what does it take to be a “great city”? Reno seems to be at a crossroads, or the begining of a long journey Nevadans are used to comstock loads rapid wealth booms, should this be any different? Perhaps that is the problem booms don’t last. Nevadans know that too!
I go back to my earlier point. If you want to live in Nevada as a full time resident over a 10-20 years, it would make as fins a home purchase as any. I would rather live in Reno than that nasty Las Vegas! The air is nice, the proximity to Tahoe, and the bay area is nice. Plus Reno is a market transportation hub for the west. So jobs seem to be plentiful.
Guy Johnson
Sean,
Thank you for your post and for lending a California perspective. I also appreciate the kind words regarding Reno. I *do* like Reno, and I believe it to be a wonderful place to live, work and play. I feel that sometimes my sentiments may get lost due to the subject matter of many of my posts.
– Guy