Reno-Sparks real estate continues to be a great bet in Northern Nevada despite 2020’s global COVID-19 pandemic and financial instability.
The real estate market is continuing its strong trend of high demand and low inventory with October’s sales reaching a new median sales price record, which is the fifth time we’ve hit an all-new high in 2020 alone. The new median sales price is $455,000 in Reno/Sparks, which is a 3.4% increase month over month (MOM) and a 14% increase year over year (YOY). Demand remains high with more people moving to the area and looking for homes and not enough new affordable housing being built to keep up.
Reno-Sparks Real Estate Trends
In October, there were 568 new listings in the Reno/Sparks market, which is up 11.4% from the 510 homes listed for sale in October 2019 but down 8.5% from the 621 listed for sale in September 2020.
On average this month, we have seen about 300 homes available for sale in the Reno/Sparks market. Last year at this time, we had closer to 1,119 homes, which means inventory has dropped by a staggering 72% YOY. The available inventory of homes priced at or below our current median sales price of $455,000, is about 20% of the inventory on market. The number of new contracts is up 21% YOY.
There were 616 homes sold in October, which broke records for October but represents an 11% decrease MOM from the 693 homes that were sold in September, which also was a record month. Despite the MOM decrease, home sales in October were up 9.4% YOY from the 563 homes sold in October of 2019, so year-to-date home sales are up 2.6% YOY, which is pretty impressive given that most of 2020 sales occurred during a global pandemic.
Additionally, the majority of year-to-date sales remain in the $300,000-$600,000 price range, which is 72.5% of the overall market.
Days On Market
Days on market is an indicator for sellers of how long they can expect their home sale to take. Average days on market increased for the first time this year in October at 78 DOM, although many homes are in contract within 30-45 days.
One reason for this could be because of the number of home refinances that current owners are taking advantage of due to historically low interest rates. New sales take priority over refinances, but they still take time away from mortgage lenders, appraisers and escrow and title companies, so it’s taking longer for contracts that require financing to close.
Price Per Square Foot
The average sell price per square foot in October increased just slightly over September as well, coming in at $249 per square foot, which is up 11.5% YOY.
Typically, the highest median sales price of the year occurs in the summer, so for it to happen in October indicates that the market may not be cooling like it traditionally does in the fall. But inventory remains at record lows, which eventually will negatively impact the number of homes sold. September and October had record sales, but that trend is unlikely to continue with the inventory at historically low levels.
A special thank-you to the essential workers, healthcare practitioners and first responders for keeping our community safe as we continue to navigate the COVID-19 pandemic. I encourage everyone to stay vigilant in the battle against COVID-19 by practicing social distancing, wearing masks and diligently washing their hands.
Cheers to a safe and socially distant start to the holiday season.