RSAR releases inaugural Monthly Market Report

The link below will take you to the first installment of a new monthly Market Report created by the Reno/Sparks Association of REALTORS, Inc.  The report is sent to member agents and brokers, and agents are encouraged to use this information in their own analysis of the market and in counseling clients and customers.

Now before anyone starts suggesting "spin" or “kool-aid", take a look at the report.  You’ll find it to be an accurate analysis of the market reflecting the same numbers we report here on the RRB.  I think they’ve done a nice job with the report.  Let me know your thoughts.

Click here for the March Market Report and the accompanying chart.

Some highlights from the RSAR March Market Report:

  • March’s Median sales price has settled back to the January level of $200,000 for now – down 1.5% from last month – a 27% decrease from March of 2008.
  • “As of March, we had only 9.1 months of inventory based on the rate of sales for March. This compares very favorably to 14.1 months supply of inventory as of March 2008. We have to go back to March of 2006 to find better inventory absorption numbers.”
  • Month’s supply of inventory in the $1 Million+ category is 50.86 months.
  • Distressed properties accounted for:
    • 72% of properties sold in March
    • 78% of what’s pending
    • 63% of new listings
  • “The increased demand we see is still at the lower end, with plenty of inventory.  Multiple offers on 150K Bank/Owned’s doesn’t do much to drive up prices.”



  1. Avatar

    As to “replacement costs”, this metric is largely a method to look at the purchase of a real estate asset in an apples-to-apples way with the alternative of building a new asset from scratch. It is only properly used generally in a normal market where values increase each year, but is a wholly insufficient metric in a declining or depressed value market.

    This is because when demand for assets is down and supply of them is up, there are deals around that make more sense to buy than build. In a market with rising asset values, there is more demand than supply (obviously, thus the rising values). In this situation, both replacement cost and resale cost are simultanteously higher. (Not always in lockstep, but you get my point.) And the converse is also true where low demand equates to both lower resales and lower production costs. Since the data is at least partly correlated, replacement cost is not a good indicator in a vacuum, in and of itself, especially in a down market. So, be careful.

    There are many markets over many long years that still have homes for well under replacement cost and will continue for the foreseeable future (Gary, IN, Detriot, etc etc.) Fact is in some markets, there’s little if any demand, and until that changes, replacement costs are nearly irrelevant in those locations.

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    That’s a great summary.
    Down, lets take a hypothetical situation.
    If I decide to build a 50 million dollar house at the North Pole, my theoretical “replacement cost” is 50 mill. plus the piece of ice it sits on. However, in order to sell the house the buyer has to have some financial incentive to buy said house. Given the lack of infrastructure etc. my chances of selling are near zero.
    I can’t tell you how many discussions I’ve had with builders over this very basic principal. I’ve been buying houses for a long time now, and it’s still something I hear over and over.
    Just recently I offered 250K for a house someone wanted 599k for. “But but but… it’s way below the replacement cost” the builder wailed. “well tell someone who cares” I replied. Then I sat back and waited for the inevitable. 3 months later back she went to the bank. This house will probably sell in the 225K range.
    As I said, replacement cost means basically squat, particulary in a down market.
    The only use it has, is to signify that you are dealing with a complete rookie, which in of itself is pretty useful.

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    CL – I stated ‘I don’t mean indiscriminately – that is less than the cost of the bricks and mortar, you have a good long term investment.’ Your statement seems to make sense if your making a general statement about some off markets in a short term venue There are many exceptions to every rule when it comes to RE, and if that’s your point it makes sense to me.

    One area I haven’t seen discussed here is the difference between wise buying and, well unwise buying to put it kindly. Maybe it is a general undertone of everything written here.

    If each of us had to invest $300k we’d surely see a lot of differences in what SFD was purchased because we understand that value. But what about 1 million? 2 million? 5 million? Would you do multiple homes? Or maybe one nice Lakeview?

    Mike, feel like picking up the gauntlet?

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    Otto – Since your example is about buying at the North Pole,with no obvious infrastructure (nice touch) I guess Santa would be your only buyer, and as we all know – he has a home! So you now have a house where nobody in the foreseeable future wants to live (Detroit?) So in your example, you not only right, but you’d have been an idiot for building there.

    I’m sorry, what was your point? Oh – how’d you offer go on the $599K house?

  5. Avatar

    I’m still waiting for BB to talk more trash about me, so I can knock every one of his teeth out of his mouth.

    BB you are fool

  6. Avatar

    As to “replacement costs”, this metric is largely a method to look at the purchase of a real estate asset in an apples-to-apples way with the alternative of building a new asset from scratch. It is only properly used generally in a normal market where values increase each year, but is a wholly insufficient metric in a declining or depressed value market.

    What is the whole Real Property insurance based upon..Replacement costs..

    So are you guys saying..the whole Insurance Companies models and way of doing business is wrong?

    Down& are correct..

  7. Avatar

    I’ve actually never been a fan of censorship. But I’ve got to draw the line when we’ve got a guy here threatening physical harm. It’s been more than once that he’s done it, and I’ve had enough. I wonder if the authorities would be interested? It’s one thing to disagree about real estate, but quite another to threaten violence. The scary thing is, when someone linked this kooks myspace page to the blog, there was a photo of him with an assault rifle. This isn’t even remotely funny.

  8. Avatar

    Yup, its a fire policy so they’ll give you up to their stated ‘replacement value’ to rebuild the structure. This number in reality often has little to do with actual builder costs because they use a formulaic approach, which I think is called Marshall-Swift. You might not rebuild for that cost, because many homeowners like to keep their premiums low by keeping the replacement value lower. Also keep in mind that it is relatively rare for the entire structure to burn down, so you might rebuild using only a portion of the funds.

  9. Avatar
    Reno Ignoramus

    APN 152-051-03

    11180 Boulder Glen Way

    Purchased 6/7/04 for $940,296

    Trustee’s Deed 5/5/09
    unpaid debt: $1,016,463.32
    paid by purchaser at trustee’s sale: $535,500.

    Nice house in Arrowcreek. Sort of looks like “Arrowcreek Gem” over there in the slideshow to the right of the site.

    Do y’all love the smell of burnin’ comps in Arrowcreek?

  10. Avatar
    reno newbie

    boulder glen in arrowcreek or mountaingate or monte rosa? new in town

  11. Avatar

    So do I understand this to mean that the bank just walked away from almost a half a million dollars on this house? The bank can now sue the borrowers for a deficiency, correct?

    Sorry for the dumb questions. I’m not the expert on Nevada law like a lot of the regulars here. But why would the bank walk away from almost $500K? Is is easier to just sue the borrowers than to take over another Arrowcreek house since there are already so many of them on the market?

  12. Avatar
    Reno Ignoramus

    Yes Loretta, in Nevada once a foreclosure is complete and the property is sold at a trustee’s sale, the lender may bring an action for a deficiency judgment. That action must be brought within six months of the date of the foreclosure sale pursuant to NRS 40.455. However, even though Nevada law allows for a deficiency action, I have yet to hear of a single case where the lender has filed one here in Washoe County. Perhaps some other readers here may be aware of a deficiency action actually having been commenced?

    I have no idea why the lender here was willing to let the property go to a third party for little more than 50% of the unpaid debt. Perhaps you are right that the bank had no appetite to take its place in the sea of Arrowcreek listings on the MLS. Who knows.

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    I believe that this house used to (at least until today) be owned by a card-carrying member of Chase Nation, or am I mistaken?

  14. Avatar

    BB- although I’ve ignored your posts recently, in this case I agree with you. Physical threats should not be allowed or condoned on any public site.

    That being said – you insult posters with your brassiness , and you thrive on it. So don’t tell me this is unexpected.

    Any poster that threatens your well being should be put away, as far as I’m concerned, but your writing style doesn’t make you immune to both criticism and, well crazy MTF’s, even if in a perfect world it should.

    But as you’ve pointed out many times, we live in a world of idiots, so it’s hard not to understand why your derided by some, although it certainly shouldn’t be with physical threats.

  15. Avatar


    Your thinly veiled attempt to justify threats of physical violence comes as no surprise. I would expect no less from you given what you’ve shown. The fact is, you could research every single post I’ve ever written on this site and find that I’ve never threatened anybody. In stark contrast to your perpetual whining, I HAVE NEVER ONCE BEFORE complained about ANYTHING someone has typed about me, or anyone else. I support their right to free speech. If you weren’t some johnny-come-lately, you’d even recall me defending derrick’s right to free speech on more than one occasion- as pathetic as his utterances are. I still do. But there’s no place in this blog world for threats of physical harm. Period.

  16. Avatar

    BB- so you say ‘Your thinly veiled attempt to justify threats of physical violence comes as no surprise’ but in 3 of the 4 paragraphs in my posting I wrote I don’t agree or condone this type of behavior.Where does this come from? Hopefully you just didn’t read it fully before you wrote your response?

    Also, look up at what you wrote – you start with a derogatory slur ‘Downer’ you called me ‘johnny come lately’ and lets not forget ‘In stark contrast to your perpetual whining’ A few moths ago you threatened to open a can of ‘whoop @ass’ on me. But you don’t consider verbal abuse on par with physical abuse?

    Ask someone whose been verbally abused – most would say they’d have rather been physically beaten.

    Apparently you and Geraldo are the only people on the planet that don’t know why others get irritated with them.

  17. Avatar

    DonC said:

    “At the top of the bubble the market was roughly overpriced by 30% relative to income and interest rates. Now it’s fairly priced or slightly under priced, depending on how you view it.”

    I suggest you put your money where your mouth is, and invest every nickel you can scrape up in real estate, purchased at today’s prices.

  18. Avatar

    Being familiar with the 2 Incline Village properties that have been referred to in the blog, I disagree that they set the standard for pricing here. There were 16 bids and some contractors who were trying to game the sale too much not realizing they had to submit the best and final offer. I know for a fact some would have paid more but those were not the rules in force at the time. You are kidding yourself if you think a property like that will sell around that price anytime soon..that person got a screaming deal and I’m no real estate bull at all. As far as the Winding Way property is concerned, there was a similiar scenario. With time as an issue for the bank it dealt with one offer at the last minute and the agents did a good job of selling the offer. The price presents a reasonable buy versus rent comparison which ignores the premium placed on homes in Incline Village..again a screaming deal the likes of which won’t be seen for a long time. Incidentally, county records show that 2848 sq ft plus 914 finished basement, so 3762 sq ft, so $246/sq ft.

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