Click on the picture below to see the latest Reno Area Market Condition Report with commentary from First Centennial Title. (3 pages)
Some excerpts:
"Generally, even though the market may have bottomed in terms of demand, prices will continue to display weakness. This result (market bottom) is in line with other areas surveyed. Sale pendings are rising, but at a pace a bit slower than other markets surveyed."
"Percent Selling is increasing pointing toa trend toward more properties closing relative to those failing (see bowing of the trend line for Percent Selling)."
"The strongest sub-market is Minden SFR. The weakest continues to be Yerrington SFR."
DERRICK
Geee and what was I saying?.. median price should settle in nicely at 245-250k..
April should prove to be a VERY strong month in terms of sales!
Do I hear 4 consecutive months of stronger sales?
BanteringBear
Let’s see, sales down 32% year over year. Yep, things are sure improving Derrick – NOT!
MikeZ
Let’s see, sales down 32% year over year.
Pay NO ATTENTION to those degenerating YoY metrics behind the curtain!
Instead, look over HERE … in just the right light (MoM, no seasonal adjustment) Feb-Mar was almost flat, so, obviously, we’re “scratching the bottom” and it’s all sunshine and roses from here on.
Quick, buy now, before it’s too late!
MikeZ
Hurry! Only 12 mos of inventory left!
DERRICK
They sure are bantering bear.. sales were down 38% last month, and 32% this month.. That would be an improvement! duh!
smarten
Mike Z said “Hurry! Only 12 mos of inventory left!”
Ah, that January 11, 2009 date at 4:00 P.M. is looking better and better! For what it’s worth, I posted an “It’s Official. The Reno/Sparks Market Bottom [Median Pricewise] is 4:00 P.M. on January 11, 2009!” blog on ChaseNation at http://chasenation.com/profiles/blog/show?id=2000642%3ABlogPost%3A5173 [I hope you guys realize that insofar as I am concerned, this is all tongue and cheek].
BTW, I know you guys are turned off to ChaseNation but surprising to me, all the abhoring feel good, back slapping, positive mental attitude garbage comments that permeated that site before Diane invited us to participate have EVAPORATED [guess why?].
Diane tells me she’ll feature a maximum of one blog/poster on the ChaseNation main page at a time [although I don’t know exactly what “a time” means]. So if a couple of you jump in with timely posts, ChaseNation may very soon exhibit a very, very different [and sobering] look.
MILLER
Interesting that they are calling it an increase for YTD. Uhh, correct me if I am wrong, but if you look at the graphs, the beginning of each year (Jan-Mar) is always the highest part of the year, right? So, if you’ve only got the three highest months of the year as your annualized run rate for sales per day (11.5), then the numbers are going to look like there’s a small trend upward. Annualize those numbers based on the previous year decrease percentage after the March sales and I would bet that sales per day number would trend down in a hurry.
– Just and observation….
derrick
Miller-
That may be true but april is shaping up to be even better than march.. so that puts us at 4 months now NOT 3..
Don’t be surprised if we reach 5 straight months.
BanteringBear
Derrick:
I would suggest you do a little research before rattling off your misguided utterances. Anyone with even the most basic knowledge of Reno real estate understands that the sales numbers almost always increase month over month this time of year, and are nothing to get excited about. Therefore, a more accurate sales quantity assessment is accomplished by comparing year to year sales (ie. March 2007 to March 2008).
MikeZ
RE: “Miller”
Absolutely correct.
When you’re desperate, you’ll slice and dice the data any which way you can to make it look good, hence “YTD” or Derrick’s “last 3 months” (same thing, essentially).
And if you think *that’s* funny, some realtors are now citing decade-over-decade appreciation to show what a great long-term investment real estate is.
We may soon see century-over-century.
DERRICK
exactly bantering bear. which would explain why you so mysteriously left out the fact that YOY sales were down 38% in march and 32% yoy this month..
A 6% improvement in only 1 month? with improving sales for 4-5 months straight? Sorry I don’t see things getting much worse from here..
The lowest you will EVER see the median is 240-245K and not even that is a sure thing.
MILLER
Since this IS Nevada, can we start an under/over pool on the Median price?
Since Derrick has set the bar at $240, I’ll take the under!
BanteringBear
Derrick:
What part of sales down YOY, prices down YOY don’t you understand? I mean, if you want to rejoice over a 32% drop in sales YOY, fine. It’s quite odd. Here’s another for you: sales can actually INCREASE as prices DECREASE. Is that good news? For buyers – yes, for those who over payed for a Spanish Springs stucco sh!tbox on a postage stamp lot – no. Do you celebrate when you lose your wallet as well?
As for your latest proclamation regarding median price, you have consistently proven to be self contradictory, and flat out wrong in your predictions. You have ZERO credibility. When the median falls well below $240-$245k, I’ll be sure to reference your latest utterance. I’m sure, as in the past, you’ll be nowhere to be found that thread…
smarten
BB is exactly right. When recovering from a bubble bottom, as sales volume increases the median price DROPS! That means the median is almost guaranteed to drop over the coming months. And I suspect that drop is going to be sizeable and quick.
So to follow up with Miller’s comments, I’ll take some of that UNDER $240K action. Are you in Derrick?
You know with dinner for 10 on January 11, 2009 plus this over/under $240K action, we’d better take some security from Derrick – don’t want to get stiffed!
Allen Murray
So when can we call bottom? After 6 months of increasing median sales price? I submit that we are getting close enough now. I know most of the lemmings will wait to see 6-12 months of positive data or for the WSJ or their bartender to tell them after the fact that we have hit bottom, but its my opinion that you are better off buying a little too soon than a little too late. If you buy a little too soon, you have better selection and get to enjoy your house in the meantime. So the only reason not to buy now is if you think we still have a ways to go to hit bottom…I say we are close enough. The problem is that we won’t know who’s correct for years to come.
DERRICK
bantering bear maybe you should get out a little more and STOP living on this blog..!! Get A life!!
Dickson
Allen, it’s a non-issue now. Smarten the Omniscient has answered your question. The bottom is on January 11, 2009. At 4:00 pm I believe. Prices will not decline after that date and time. So if 9 months is “close enough” for you, go out and buy a house. Hell, buy two or three. You don’t want to be a bartender-relying lemming of course.
And if it turns out the Omniscient doesn’t know what the hell he is talking about, and you end up losing your ass, I’m sure he will put his money where his mouth is and cover your losses.
Go for it.
MikeZ
So when can we call bottom? After 6 months of increasing median sales price?
Learn from history or be doomed to repeat it …
Allen, you might want to look at the price data from the last bubble/collapse: http://tinyurl.com/yq7vgh … note the dead cat bounces, the first at 24 mos (guess where we are now in *this* collapse?).
I’m sure those bounces looked like real bottoms at the time to people who were desperate to call a bottom.
My point is: You might want to leave the Dom corked and in the fridge for now.
Allen Murray
Dickson, surely you understand that Smarten is speaking tongue in cheek with that prediction, you’re not naive enough to think he is serious are you?
Allen Murray
Mike, historical data doesn’t mean much, we are in unchartered territory. You can pull up as many charts and news history reports as you want it doesn’t mean squat if you ask me. All I’m saying is that I don’t think we have a whole lot farther to fall. You obviously disagree, what’s your median target or other criteria, and when do you think it will occur?
BanteringBear
Allen Murray posted:
“…its my opinion that you are better off buying a little too soon than a little too late. If you buy a little too soon, you have better selection and get to enjoy your house in the meantime… All I’m saying is that I don’t think we have a whole lot farther to fall.”
It’s always a good idea to consider the source. Allen Murray is trying in vain to unload a massively overpriced anchor. If you don’t “need” to sell Allen, why did you recently lower your price?
Personally, I call BS on all of the don’t need to sell crap we’re hearing. I’ve watched properties go from “don’t need to sell” to foreclosure.
Allen Murray
BB, I have to agree with Derrick, you need to get a life. I’ve only reduced the price on my house once, and it was 9 months ago. Please check you facts before you comment and quit stalking me. Secondly, I find it amusing that you never make a prediction or tell anyone here where you are coming from, you just criticize other’s opinion, and rarely back it with fact. So unless you want to jeopardize your already feeble credibility, answer this: What angle are you coming from, and when do you predict bottom? Your failure to answer these questions will reiterate my point.
BanteringBear
Allen:
I’ll NEVER come out of anonymity. I know it just burns you up, and I love it. Stalking? That’s just weird Allen. Let’s stick to real estate.
Allen Murray
BB, hahhahah..just what I thought=)
Allen Murray
BB, how about one more chance to redeem your credibility. What do you mean by asking why I recently reduced my asking price? Was that a mistake on your part, or do you consider 9 month recent? If you want to play BB, I’ll be happy to play with you……
BanteringBear
I will put out one disclaimer to the blog, and this is not to satisfy Allen. I do not reside in Reno, own a home there, nor do I ever intend to. I have no vested interest in prices, therefore I will not benefit from them be they high or low. I may, however, be interested, at some far future point, in a second home on acreage at Tahoe. It’s not something that is very important as I can enjoy myself quite well in a vacation rental.
BanteringBear
Allen, I have no credibility issues. Do you always resort to making things up when angered? I think it’s quite pertinent to point out that you are one of the many delusional sellers in todays market. Don’t you? Let’s be honest here.
BanteringBear
Allen:
Regarding the price thing. If I am not mistaken, and perhaps I can locate the post, Smarten quoted your asking price at $1.3M. Your listing disappeared from the mls recently (to “refresh the listing”?) and it’s now listed at $1,199,000. It looked to me like you dropped it $100k. If not, I stand corrected.
One question: If the bottom, in your opinion, is going to be so brief with prices taking off shortly thereafter, why not just hang onto your house and ride out that appreciation you expect?
smarten
Well, another interesting exchange between BB and Mr. Murray.
So now I have a couple of questions. Why BB, do you have an interest in Reno real estate and this blog? You’ve admitted you have no vested interest now or in the future and although you might want some Tahoe [versus Reno] acreage in the future [and BTW, where exactly does one find Tahoe acreage?], you’d rather vacation rent. So what’s the interest other than we players?
Again, most of the rest of us have some direct interest in the local real estate scene; what’s yours?
And to Allen, is BB correct when he states your opinion is that the bottom is going to be brief with prices taking off shortly thereafter? If so, when is the bottom pricewise, and for how brief?
Although I do agree with you it’s better to buy slightly before [versus after] a bottom, are you familiar with 106 Londonderry Court in St. James Village? 5,200 square feet of fairly new, upscale construction for $900K [or possibly less]. How does that comparable stack up to your home, and would you say now is the time to buy something like this [for what it’s worth, I say it still has another $150K or so to go]?
Allen Murray
BB, just to be clear, I never asked you to break your anonymity, to each his own, I just ask that you back you comments up with some substance instead of just criticism. Secondly, you obviously have me confused with someone else in that I have stated here many times recently that I don’t think the bottom is going to leave anytime soon. I think Smarten’s guess of Jan 09 may be close and Green’s median target of $235K might be close, and that even makes Derrick pretty close, nobody has a crystal ball, these are guesses. You have failed to ever offer a target, just criticism.
Lastly, I listed my house in May have 07 for $1.3 and was averaging 3 showings a week for the first few months. After no offers and showings tapered off, I reduced the price $100,000. It has been at that price ever since. The listing has never went off the MLS as you surmise. l I ask that if you want to criticize me, get your facts straight, I can take it, if you are going to call b.s. expect me to call you back. I have told my listing agent several times that if he thinks he’s wasting his advertising dollars that I completely understand him wanting to cancel the listings. In light of the recent repeat showing and an “almost” offer, we decided to run it through the spring and see what happens. I suspect given your stalking nature, that you will be one of the first to notice if it sells, or if I take it off the market. Any questions BB?
Allen Murray
Smarten, to answer your question, I think the bottom is going to be here for some time. I believe this because of the current recession and credit crisis, this will take years to work through. If you believe this and think we are near bottom now, why wait 2-3 more years to buy for the exact same price on the upswing? The reason I think we are near bottom is because I think the low end is getting back into line with what the locals can afford. I’m not so sure the high end will follow. I suspect many if not most high end owners don’t have the same debt concerns as in the lower to middle price ranges. How many people do you know that live in a $1m+ house and need to work to make their payment?
As for comparing the St. James house to mine, I have no clue. I will tell you that I know several investors looking for “deals” now including myself in the lower end. I actually looked at the Palisade house mentioned by GreenNV a while back, but thats a whole other topic.
Marla
After a year on the market with no offers, at what point would a hypothetical seller perhaps conclude his house is overpriced?
Hypothetically, of course.
BanteringBear
Allen:
I’ve looked at your listing twice. Why? Because you foolishly blew onto this blog with diarrhea of the mouth using your real name like you were the second coming of Donald Trump, all along bragging about your real estate savvy. And now, you’re whining and crying about stalking? Get a clue, Allen.
Yes, Marla, you’d think a seller would wake up after a house hasn’t had an offer for more than a year. Diane recently wrote a column about those in need of price therapy. Perhaps Mr. Murray will never come out of his greedy stupor.
Allen Murray
Haha, I hear you Marla. You know its funny, people forget that getting 2 full priced offers in the first week your house is listed for sale is not normal. Obviously, there is a price that any house will sell at. I could sell it tomorrow at a certain low price and I may never sell it at what I’m currently asking. As I have mentioned on this blog before, as long as I’m getting consistent showings at my current price, I will continue to market it. Consistent showings are few and far between for some, I’ve talked to people who have had their house for sale for 6 months without one showing. Also, if you look at the average market time to sell a house in my price range, mine should sell any day now….haha joke BB. Even when times were good, 180 days to sell a $1m+ home was about average. Also, Marla, I do actually need a place to live, and my house is pretty nice=) I don’t really understand why my refusal to lower my price to sell my house tomorrow evokes such strong emotion from some, Who really cares, if I’m overpriced, go buy a different house…..
BanteringBear
“The reason I think we are near bottom is because I think the low end is getting back into line with what the locals can afford. I’m not so sure the high end will follow. I suspect many if not most high end owners don’t have the same debt concerns as in the lower to middle price ranges.”
This is an extraordinarily naive statement. Allen, if you honestly believe this, you’re in the wrong profession. If you know anything about real estate, and previous busts, it’s that an ebbing tide lowers all boats. I’d like hear an explanation as to how your theory is even possible.
A rough hypothesis would say that if a $350k house turns into a $200k house, then the $500k house is the next $285k home. In your scenario, some less expensive homes would drop in price while pricier ones would not, the end result being certain price points having ZERO homes on the market. Not gonna happen.
GreenNV
Allen, in fact your house did show up as a new listing on April 4, at least at Prudential. I have no idea if it was a miscoding on an extended listing or a “bump” by David Hughes, but I might hazard a guess.
If you have an unique home that appeals to a select group of buyers and can hold out, it can be rewarding. 465 Leventina Canyon hung on at $1,197,000 after dropping from $1,250,000 I recall, for a year and a half. It is now off the MLS, owners have moved out, Sold sign on the property. Can’t find any recorded data yet, but it looks like this house (one of the few I think was worth the asking price) sold close to asking (this was not a must sell).
But the number of “special” home sort of bothers me.
Allen Murray
Thanks for the info Mike, I did recently renew the listing, but I didn’t realize it had expired and believe the days on market remain accurate, am I correct? The price is unchanged. As you may know, I’ve been playing this game for almost 20 years now, and I do realize that most people think that their house is more “special” than the next. Obviously, my house is currently worth more to me than anyone else, but you have to have your line in the water to catch something, and I’d like to think that I’m not a bad fisherman……its just hard to sell anything right now when the fish aren’t biting.
smarten
Allen, I must disagree with your statements “the high end will [not] follow” the low end, and “many if not most high end owners don’t have the same debt concerns as in the lower to middle price ranges.”
We’re already starting to see the high end follow the low end insofar as pricing is concerned. Not as dramatically, but movement nonetheless. I gave you an example with Londonderry [a BK that was filed to stop a foreclosure (i.e., they have the very same debt concerns lower and middle priced property owners)] that has dropped over $300K [25%] in price. There’s another listing in St. James Village that’s in the $800K’s [prices haven’t been that low in this community for many number of years]. I think John made a post several weeks ago that referenced a crack in Montreux pricing [from over $2M to $1.7M plus]. And I think I recounted how I met a fellow who just closed on a Saddlehorn 3,000 square foot home at $600K; down from $850K plus.
These are all examples of the high end of the market following suit with what has been going on in the low end of the market. And I think if you ask Diane, she’ll tell you it’s her opinion the high end of the market is now primed to implode.
And what’s the problem with your hanging tough on your overpriced home? It artificially lowers the percentage of sales/listings, and forces those sellers who really need to sell to artificially lower their prices even more. Sorry!
Reno Ignoramus
Allen, there appear to be 63 houses on the MLS between $1 million and $1.2 million. 6 are reporting a pending offer. So you have a 1 in 10 chance. That isn’t all that great, but in this market it’s a bit better than the 6% of houses that are actually selling. Of course, pending does not mean sold, and at least 1 or 2 of those pendings will probably never go to sale. So there you are, right there with the rest of the sellers trying to snag a fish, as you put it.
SkrapGuy
Here’s the problem Allen has. I think we can all agree (can we all agree on anything??) that the people who buy Allen’s house are not going to be first time home buyers. They are going to be move-up buyers. So, move up from where? Let’s say from the $700K to $800k range. That seems about right for the next leap up. Well, there are currently 109 SFR in the $700K-800K price range in Reno-Sparks. 3 have an offer. Yes, a whopping 3% of the houses in that price range have an offer. This vapor lock is present all up and down the market. So where are Allen’s buyers going to come from?
Tell me anything, just please don’t tell me they will be rich Californians.
Allen Murray
Smarten, again, you don’t have to apologize, and you might be right, I just don’t think we will see it to the degree as the lower end, but that’s just my opinion. All I can say is if my house ever sells near my asking price some of you will have to eat crow. I’ve never said I was confident I will get my price, but I’m not as sure as you that I won’t. Keep in mind, my asking price was thought out as I have explained before, but I’ll reiterate. In late 2004 as construction was completed, Wells Fargo appraised it at $1.2m. I realize it was almost a year before the peak. I lived in it for 2 years like I have done 3 times in the past to avoid capital gains and put it up for sale in May of 07. I refinanced it in Jan of 07 to take my ex off the note and again it appraised at $1.2m. At that time Zillow had it at $1.4. When I listed it last May, we pulled recent solds and actually walked through current listed in my area and price range and set the price. What I am saying is that my price was thought out, and I have been do this for a living. Will I make money on this house like I have in the past…probably not? Am I complaining…absolutely not, that’s the game I play. Be careful about commenting too strongly without having actually seen my house and knowing what kind of activity it has been getting. If things don’t pick up this summer, I will probably sit on it for a while.
Allen Murray
RI, thanks for pointing out my 10% chance, I’ll take those odds….you are absolutely right about pendings not closing. I wouldn’t be suprised in this market if its 50/50.
Skrap, you ask who will buy my house? If I knew, I would have already sold it to them.
BanteringBear
The problem I have with Allen Murray’s house, is that it’s Allen Murray’s house! Just kidding. Moving on, I grew up right around the corner from Allen. In fact, my old house is maybe 15 doors up. I think Allen overbuilt for the area. It was a nice area growing up, but it’s a little dated now, and I think there are much nicer areas for the money.
Allen’s house is large, but I still think the price will bottom in the $500k range, give or take a little. That’s still better than $100 per square foot. I do take into consideration that, at that price, it would cost much more to build, but I believe prices will over correct due to the severity of the credit crisis and current recession.
I always go back to the fact that 3 Newlands Circle, a glorious property with a guest house, sold for ~$550k pre-bubble. That was undoubtedly a good price, but an indication that million dollar homes were, and should be, few and far between in Reno. There are many parading themselves as such, but few will prove to be legit.
Reno Ignoramus
Reno never was million dollar market. Ever. Yes, there were a few folks who could pay a million dollars without Voodoo jetfuel. But not very many. Take away the Voodoo money that juiced the fraud and the frenzy between 2001-2006, and what do we have? A community where the median household income is about $46,000 a year. Wage and income growth in Reno has been stagnant for years, just as it has been most places. By traditonal standards, a buyer would need about $250,000 in annual income to buy a million dollar house with 20% down and an 80% loan. Not exactly your typical Reno buyer.
This is not to say that some cardiologist won’t come along and buy Allen’s house. But without the Voodoo juice, the million dollar market is going to see some serious retraction in the next 2-3 years.
Sully
“Percent Selling is increasing pointing toa trend toward more properties closing relative to those failing (see bowing of the trend line for Percent Selling).”
So if 37% of 206 (Reno/Sparks combined) actually closed. Thats 76 from 206 leaving 130 that didn’t close. What happened to them?