After a dramatic slowdown in September, sales
remained steady through October, with overall activity off 41% from the year prior.
Meanwhile, the median price increased slightly to $280,000. Months supply of
inventory in the $500K-$1 million range is now approaching two years, with nearly
three years supply in the $1-2 million range, and an infinite supply of homes
over $2 million due to another month of zero sales. Full report.
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Reno Ignoramus
I believe this month does herald a new milestone. We are now in excess of a year’s inventory in all price segments. Up to now, the under $300K segment had been holding at under a year’s inventory. No longer.
It seems we have a nice stairstep increasing inventory as we go up in price. From 13 months ($300K and under) to one and half YEARS ($300K-$500K) to almost TWO YEARS ($500K-$1 million) to almost THREE YEARS ($1 million-$2 million)to a never ending, infinite, endless amount of houses in the $2 million and over category.
Now, Diane, my very finite mind has a question for you. If we have THREE YEARS of inventory in the $1 -2 million price range, how is it that houses in that range are selling in only 97 days on the market?
If we have TWO YEARS of inventory in the $500K-$1 million price range, how is it that houses in that category are selling in only 132 days?
I’m sure there is a very logical and understandable explanation. I just can’t think of it, and ask your help.
Lindie
In the $500K- $1 million category, there were 704 listings. 29 of them sold. 675 of them did not. 4% of the inventory sold. 96% of the inventory did not sell. (Certainly not 11% of listings “selling through”).Of the 29 houses in this category that actually sold, the MLS says they sold in an average of 132 days on the market. I suppose that is possible. Just as possible is that the DOM numbers are still phony.
In the $1-2 million category, there were 241 listings. 7 of them sold. 234 did not sell. 3% of the inventory sold. 97% of the inventory did not sell. (Again, certainly not 11% of listings “selling through”). Of the 7 houses in this category that actually sold, the MLS says they sold in an average of 97 days. Well, again it’s possible. But it does sound curious that in a price category where there is three years of inventory, the houses actually selling are selling in a little over three months. If there was an open MLS (I know, dream on) we could look up all these houses and see how long the house has been on the MLS, not just the most recent listing. After all, there are only 7 of them.
smarten
Lindie wrote, “In the $500K-$1 million category…4% of the inventory sold [and] 96%…did not…In the $1-2 million category…3% of the inventory sold [and] 97%…did not…”
I couldn’t help but think that if we were talking about Incline Village/Crystal Bay rather than Reno/Sparks, these numbers would suggest [to Mark and Lexi] a booming market immune from everything else outside of its borders! What a difference a little mountain [Mr. Rose] makes.
SkrapGuy
If I read Diane’s report correctly, it appears that in the entire Reno-Sparks market over $500,000, only 36 houses sold.
36 houses out of some 5,000 plus houses for sale.
Between $1 million and $2 millon, only 7 houses sold.
Over $2 million, no houses sold.
I have said before, Reno is not, in any substantial way, a million dollar market. Now that the cheap easy liar money has gone away, and people actually have to prove they can afford the freight, we are seeing how many people can really afford (as opposed to buy) a million-plus house.
What is surprising to me is the very low number of sales in the $500,000 and over segment. Perhaps we are now also beginning to see how many people can afford (as opposed to buy) a $500,000 house as well.
One of the fascinating things that struck me about the bubble was how so many people became blase about spending a half of million dollars on a house. I guess when you were just damn sure that it didn’t matter what you spent becuase some Fool greater than you would surely come along to pay even more, it didn’t matter.
To me, $500,000 has always been a lot of money.
And it appears that the much heralded California retirees have yet to appear to snap up all our high end houses.
Diane Cohn
Lindie, RI: Interesting questions. Since there were only seven in the $1-2 mill range, I went back and looked at those. And bonus, today I found an eighth. Three of them had been on the MLS prior under different listing numbers, so yes, days on the market were skewed. Here’s the true DOM picture:
226 S Earlham 68+183 DOM Sold $1.148 mill
2849 Mountain Spngs 111 DOM Sold $1.175 mill
2710 Del Monte 41 DOM Sold $1.25 mill
5940 Cartier 77+289+23 DOM Sold $1.277 mill
3785 Boulder 189 DOM Sold Sold $1.528 mill
5764 Indigo 51+121+418 DOM Sold $1.6 mill
4010 Canyon 142 DOM Sold $1.975 mill
Bonus eighth house:
5735 Nordend 321 DOM Sold $1.271 mill
You guys wanna do the math?
Remember, as of September 1, 2007, our MLS will be tracking cumulative days, so hopefully our deceptive little DOM data problem will solve itself going forward.
Reno Ignoramus
So the accurate number is that the houses in the $1 million- $2 million range that sold in October sold after an average of 254 days on the market, not 97.
So what’s a misrepresentation of 300% among friends?
BanteringBear
“So the accurate number is that the houses in the $1 million- $2 million range that sold in October sold after an average of 254 days on the market, not 97.
So what’s a misrepresentation of 300% among friends?”
A question for realtors:
When somebody comes to you to market their $1M plus home, do you tell them that it is taking an average of 97 days to sell, or 254 days? Where do the lies stop?
sf rental
It does not have to take 254 days to sell or even 97 days to sell. Just price it about 10 below the cheapest house (per sqft) and it would probably sell much quicker.
With the current inventory and the fairly recent correction to DOM, it may take years before this understatement disappears.
Nevertheless, it should be no surprise if the market shows a tiny segment moving quickly because it is priced right, while the majority is priced to wait.
john
Its nice to see that 5735 Nordend which is one of Montreux’s new chalet models sold for $1.271 mil. Asking was $1.499. It’s the first to have sold of many Chalet’s already built or being built. Sales are slow to say the least. One sale in over 12 months. Three months ago I inquired about a discount on this model and was told 100k was the best that could be done. Now we are down to almost 250k off. Soon I suspect these will be selling for 1 mil which will put the much lower quality tract home like Renaissance models well under 1 mil where they belong. The ice is cracking in Montreux. Next year should be prime shopping time and 1mil – 1.5mil will actually get you something much nicer in Reno than you can get in the Bay Area for the same price. Right now that’s just not the case. A good 25% correction in the over 1mil market is coming soon.