What can I say? The big news is that residential sales are off by 26% in March 2007 compared to March 2006 as inventory ticks upward. This does not bode well for a strong spring selling season in the Reno real estate market, to say the least. read
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MikeZ
Told ya.
I read just this week that YOY median prices had dropped by almost 33% (31%) in a county in New England (my hometown).
Prices there are now back in line with the pre-bubble price/growth trend. The same thing has to happen in Reno, though it may not all happen in one year.
Green NV
Dang it, I tried to post a pithy, current, insightful commentary about why things aren’t selling (complete with maps, graphs and color 8×10 color glossy phographs) but lost it to an editing error.
The meat of it was that things aren’t selling because the sellers don’t have a clue about the current market. That they are listing their homes on an average of 25% over the peak valuations of July 2005, and forget about Guy’s Median Sales chart showing a 15-20% decline from the peak. That bottom line, asking/sell price needs to decrease about 40% from asking to get the market going again.
The original research was done on Craig’s List. Not scientific – it is the home of a lot of 3rd tier agents that think this is high tech matketing. But some interesting properties show up once in a while.
I couldn’t believe that 25% asking price over the peak. So I narrowed my search to the newest listings from 89523 over the last 2 months or so. Listings w/o photos, attached units, and Sierra Canyon were ignored. In the end, asking prices are about 16.5% over selling prices around 7/2005.
So maybe I was too harsh initially. Asking prices may only have to dive only 30% not 40% to meet the market.
Maybe that is today’s good news story.
If you want the more detailed data, let me know. It is just such a pain posting a chart on this blog format.
Q for Diane. Where do you extract your sold information from? Washoe Assessor seems to be about 5 weeks behind the curve. Does the MLS have an earlier, proprietary data base that is more current?
BanteringBear
Most homes on the market right now are horrendously overpriced. Rather than lay blame, I will leave it at that. But that’s not the lone reason for the slowdown in sales. It actually has more to do with the overall dynamics of todays market. To put it simply, supply is crushing demand, and will continue to for years to come. This is due to the massive and continued overbuilding of new homes, as well as a glut of resales hitting the market for various reasons. While lower prices might attract more buyers initially, sales volumes will continue to decline. More people are already in homes than should have been, many of which will end up in foreclosure. The number of future buyers is simply too small. Any talk of hitting bottom or a stabilization in prices is, at the very least, horribly premature. It’s a rocky road which lies ahead.
Diane Cohn
Green NV, I pull my data from the Northern Nevada Regional MLS. It’s a live database of information about property resales that involve real estate agents, and I limit my analysis to homes, condos, townhomes and manufactured homes in the Reno-Sparks metro area.
I believe the information extracted is generally accurate except regarding days on the market (it’s too easy to withdraw and relist the same property multiple times, but our board is working on this issue), or when agents don’t update listing status in a timely fashion (which doesn’t happen too often as there are many fines associated with not properly maintaining listings.)
The software does a good job of collecting data, but it’s a poor platform for serious analysis, which is why my broker exports to Broker Metrics.
The assessor’s office, though behind, gives a more accurate picture of the market because it includes all property transfers… new, resale, for sale by owners, family transfers, refinances, etc.
Brian Kaiser over at UNR is the professional analyst who gets paid to go through the MLS and assessor numbers with a fine tooth comb to come up with a truer picture of the entire local market, and those reports can be purchased.