Let’s take a look at the existing housing inventory and sales statistics by price range for the Reno-Sparks area, as of January 30th.
Local housing inventory and affordability have been main topics of conversation in the real estate industry for much of this past year. At the end of January, overall inventory was up 13.3% year-over-year. However, inventory in the most affordable price ranges is down nearly 12%. The most notable year over year inventory change occurred between $300,001 - $600,000 where we see a 30% increase in availability. The increased inventory in this price range is mainly due to the appreciation in home values, which is being driven by strong economic and job growth.
When we look at absorption by price range, we still see a strong seller’s market in homes priced below $600,000. For homes priced below $300,000 there is currently 25 days of inventory emphasizing the need for more affordable homes in our market. For homes in the range of $300,001-$600,000, available inventory is just under 2 months. It is good to remember that The National Association of REALTORS considers 5 to 6 months of inventory a healthy market, where neither buyers nor sellers have a distinct advantage. In the price ranges above $600,000 we have a greater inventory of available homes, and a shift toward more of a buyer’s market. The months of inventory sits at 5.4 months for properties in the $600,001 to $900,000 range. In the next price range from $900,001 to $1,500,000, it sits at is 8.6 months. For homes priced over $1,500,000, we have seen a dramatic increase in inventory since the beginning of 2016; currently with nearly a 4 YEAR supply.
Over 92% percent of all sales this year have been under $600,000, with 54.3% of sales occurring below $300,000. 38.3% of sales occurred between $300,000 and $600,000. Only 4.9% of sales this year have been between $600 and $900,000. The remaining 2.5% of sales were over $900,000. The supply-demand equation continues to drive home prices up in the most affordable price ranges below $600,000. However, the pace of price increases is beginning to temper, and often depends on the neighborhood or area of town.