I believe that the Reno Real Estate Market is slowing down. There are several factors for this.
- Many people believe home showings have been postponed due to COVID-19. However, in Nevada real estate agents can still show property in person to potential buyers.
- Home closings in general are taking longer to process and underwriting standards have risen. Many applicants that were qualified previously may be required to have a higher credit score to move forward today.
- More people are now unemployed but still require financing to buy a home.
- Several local Brokerages are requiring paperwork be filled out regarding COVID-19 prior to home entry.
For more information regarding the bullet points read the article below.
To get local market insights for Reno and Sparks, Nevada keep reading. The market may be slowing down but that doesn’t necessarily mean prices are going down.
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It’s Best to Look at Leading Indicators to Determine if the Reno Real Estate Market is Slowing Down
Let’s look at pending sales, property showings, and withdrawn listings as indicators of where the market is headed. From what the data is telling us below it is clear the Reno real estate market is slowing down.
Pending Home Sales in Reno-Sparks, NV
Pending sales are homes that are under contract in Reno-Sparks, Nevada. It is fairly common for a home to close in 30 days but some could take longer. I was hoping the positive growth on pending homes from the week of March 29th to April 18th would continue but no such luck.
Property Showings in Nevada
Last week we saw the pending sales numbers decline which isn’t that surprising with showings remaining low but trending slightly upward since mid April. Home showings in Nevada are down -52.3% from this same time last year.
Homes Withdrawn from the Multiple Listing Service (MLS)
A withdrawn listing is a home that was taking off the MLS. Having a certain number of withdrawn listings is normal, however what we are experiencing is not. COVID-19 is a big problem for the real estate market. Many people don’t want to leave their homes to view a stranger’s property and/or are no longer qualified to purchase a home due to underwriting standards being raised or changes in employment.
Fewer sellers want to open their doors and less buyers want to view property which results in huge jump in withdrawn listings. Only one of the 83 listings withdrawn last week was classified as temporary off market. Not good.
Housing Market Statistics
To get an idea of how the Reno-Sparks housing market is trending over a greater period of time I have selected a few key factors to analyze. These are the median sold price, average number of days on market, and the number of homes sold. All data is based on single family homes and was obtained through the Northern Nevada Multiple Listing Service (NNRMLS).
Median Home Price
Just because the market is slowing down doesn’t mean prices are declining. The median sold price for single family homes in Reno-Sparks is remaining relatively flat. No one knows for sure where prices are headed.
In my opinion, I would expect to see prices gradually decline. However, with all the World banks printing a large amount of money it may prop up home prices along with other market prices. One thing I feel for certain is that the currency is being devalued… So the amount of dollars it takes to purchase a home may stay roughly the same, but the dollars will be worth less.
Monthly Homes Sold
A great health indicator of the housing market is the number of homes sold. Remember, the homes sold metric is a lagging indicator due to the closing of property taking roughly 30 days or more. Moving forward we will start to see the affects COVID-19 has had on the real estate market. We are already seeing a slow down in homes sold for this time of year.
Average Days on Market
The Average Days on Market for homes sold in Reno-Sparks has been declining coming out of the winter season. The statistics suggests a fast paced market. However, we now know there are fewer deals happening. Days on Market is the average number of days between when a property is listed and the contract date when an offer is accepted.
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