In the Sparks and Reno housing market, prices are at record highs, inventory is at record lows and demand is not slowing down. Whether you’re a buyer or a seller, keep reading for more insights into the Northern Nevada real estate market.
Sparks and Reno housing stats you need to know
Median sales price
The median sales price for the Sparks and Reno housing market in November 2020 remained steady at $455,000—the same as it was in October 2020. The median sales price is the mid-point value where the price for half of the closed sales is higher and half is lower. Since November 2019, the median sales price has increased by almost 14%, from $400,000 to $455,000.
Price Per Square Foot
The price per square foot was at $253 per square foot in November, which also is up 14% year-over-year, so the market is holding strong as demand is high and inventory remains low.
Supply and Demand
To determine supply, we analyze new listings. In November 2020, there were 375 new listings on the market, which represents a 35% decrease in inventory month-over-month and a 12.4% decrease year-over-year. As of this morning, only are 226 homes are on the market in Reno and Sparks, a record low. A year ago, there were 974 homes for sale, which means inventory has dropped by more than 74% year-over-year. Furthermore, there only are 51 homes for sale, and 20% are priced at or below the current median home price of $455,000.
Another way of assessing the inventory levels of Sparks and Reno housing is by looking at the months of inventory, or the time it would take to exhaust the active listings at the current rate of sales. A five to six-month inventory is considered a healthy and balanced market, where neither buyer nor seller is favored. As of the end of November, homes in the $300,000 and below range had five days worth of inventory, while homes in the $300,000-$600,000 range had 8 days worth of inventory. The luxury price range has dropped to just 4.7 months of inventory.
Demand remains high as more people move to Northern Nevada for employment, lifestyle, or to take advantage of the state’s favorable tax environment. To measure demand, we track the number of homes that go into contract in a given month. The number of new contracts went from 612 in October 2020 to 434 in November 2020, a 29% decrease. The November 2020 figure also represents a 5.4% decrease year-over-year from 450 new contracts in November 2019. The decrease is more of a function of low inventory though and does not represent a softening of buyer demand.
In November, 590 homes were sold, which was a 5.6% decrease month-over-month from the 625 sold homes in October. Despite the small month-over-month decrease, the November 2020 sales still represent a record number of sold units for November and a 30% increase year-over-year.
In short, the number of year-to-date home sales are up 5% from the same period last year, despite this year’s pandemic conditions. The majority of sales—72%—was in the $300,000-$600,000 price range.
The luxury market is also flourishing as we see homes at the $1 million and $2 million price points getting into contract in less than two days with multiple offers.
Days on Market
Days on market is an important metric for sellers to understand typically how long it will take them to sell their home. In the Sparks and Reno housing market, this number decreased 9% month over month in November, from 78 days in October. Many homes are getting into contract within 30 to 45 days. At the same time, title companies, lenders and appraisers are also racing to keep up with the refinance boom created by record-low interest rates.
Inventory levels setting new record lows by the day will likely drastically impact the number of sales we see in the next three months. The first months of the year usually come with low inventory, so don’t be surprised to see January’s sold units lower than ever before. The Sparks and Reno housing market continues to be a seller’s market in all price ranges. While there are ways to leverage this to your advantage, it’s always best to have an experienced and knowledgeable REALTOR by your side.