Reno-Sparks Homes and Real Estate Market Report May 2011

Summary:

• The median sales price has continued its settling trend over the past 24 months.  More buyers and investors are deciding it is an opportune time to purchase a home.  High inventory and low prices reflect the affordability of homes, verified by the increase in home sales.

Reno-Sparks Homes Median Sales Price

• May 2011 median price was down 3.6% to $147,900 compared to $155,250 in April 2011.
• The median sales price continues to settle from the prior months.
• For the past nine consecutive months median price has been lower than the prior year-over-year median.
• Median price is defined as the mid-point, the price for half of the sales for the time frame is below and half are above.

Reno-Sparks Homes Price per Square Foot Sold

• Price per square foot is at $90.34.
• Price per square foot by area groups, as provided in the Detailed Report, is a good way to compare similar homes within a specific area.

Reno-Sparks Homes Sold

• This May’s unit sales of 496 single family homes is the second highest May in the history of sales reported through the MLS.  Statistical records date back to 1989.
• May ended the month with 496 single sold transactions, up 15.1% from the prior month.
• Sales were up 10.2% from the same periord last year, which continued to be influenced by the First Time Home Buyer tax credit.
• This month’s sales were only exceeded by May 2005 (644 units sold), which occured during the real estate boom.

Average Days on Market

• The average days on market are 134 days, down 3.1% from April 2011.

Day on Market (DOM) by Special Conditions (New Report)

• Short sales continue to influence the average days on market with over 190 DOM.
• Properties with no special conditions, REO, or Other show a range of between 90 and 120 DOM

Reno-Sparks Homes New Listings

• 787 new listings were taken in May compared to 785 in April, a less than 1% increase.

Distressed New Listings by Special Conditions (New Report)

• The percentage of “Distressed” new listings was down 3% from the prior month.
• 60% of new May listings were distressed – 243 Short Sales, 217 Bank Owned/Other
• The number of new listings with no special conditions has increased for the past five months, while the number of short sale listings have declined.  After a recent peak in December 2010, REO new listings have remained stable.
• Note:  Properties reported as “Other” which includes “Fannie Mae’s, Freddie Mac’s and HUD’s” are included with Bank Owned REO properties.

Status of Pending

• Active Pending – Short Sales represent 58% of the total active pendings; Active Pending Loan equals 18%; Pending No-show represents 18%; Active Pending call 5%; and Active Pending House less than 1%.

Reno-Sparks Homes Months Supply of Inventory  (Unsold Inventory divided by Sales per Month)

• As of May 31, there was 6.8 months of unsold inventory based on the May sales rate.

Historical Months Supply of Inventory

• Historical Months Supply of Inventory show that May MSI is down 1.2 months from April and May 2010.
• In the past twelve months, there have been five months which have fallen into what is defined as a balanced market.  In the past 24 months, the market has remained as primarily a buyer’s market.
• The National Association of REALTORS® describes a balanced market as between 5 and 7 months supply.
• Unsold inventory includes Active Pendings.  This method of reporting months supply of inventory follows the industry standard of including all pending sales remaining in active status in the active inventory.

Conclusion

• May 2011 median home price of $149,700 is the lowest the Reno area has seen since 2000.
• May 2011 closed sales numbers set a near record as being the second best May for single family sales number in history.
• Year-to-date 2011 unit sales numbers continue to out-perform 2010 unit sales by 2%.
• In May, the “Bank-owned” sales category held the dominant share of the market with 40% of the closings.
• The affordability door is open to a wider range of buyers.  This means that a two-income, household earning approximately $10 per hour each, can now afford the median priced home in the Reno/Sparks area.
• Mortgage rates are at historic lows.  Rates are predicted to move up before year end.  For those with stable jobs and who expect to stay in their home long-term, it’s an excellent time to buy.
• The number one market requirement for Nevada is jobs!
• For buyers, it’s buyer confidence and credit worthiness to qualify for financing under stricter underwriting guidelines.
• At current median prices, the dream of homeownershp has never been more affordable.

Report courtesy of Reno/Sparks Association of REALTORS® with data sourced from Northern Nevada Regional MLS

To read the full report complete with charts, graphs and 5 year history Reno Sparks Homes Real Estate Report May 2011.

To read Reno-Sparks Homes and Real Estate Report April 2011.  Previous months can be found under Categories: Reno/Sparks Market Reports