The 2014 Reno/SparksResidential Resale

Mid Year Market Report

Mark Ashworth

President

Reno/Sparks Association of REALTORS®

Trans-Action Realty 500

www.rsar.net

1

Feast ?

2

Famine ?

3

The Recovery Path Gets Clearer

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%NONE%

SHORTSALES…

REO%

IS IT REALLY A PATH ?

4

Not Sure It’s a Path….

The Buyer’s Tight Rope5

The Inventory

Home Sales

Home Prices

Distressed Properties

The Market Mix

The Buyers & Sellers

What’s Going On Now In Our Market?

6

Active Inventory – Single Family Homes

0

500

1000

1500

2000

2500

3000

3500Net Active Listings TOTALS

7

The Inventory Mix

0

100

200

300

400

500

600

700

800

900

1000

No

v-1

0

Jan

-11

Mar

-11

May

-11

Jul-

11

Sep

-11

No

v-1

1

Jan

-12

Mar

-12

May

-12

Jul-

12

Sep

-12

No

v-1

2

Jan

-13

Mar

-13

May

-13

Jul-

13

Sep

-13

No

v-1

3

Jan

-14

NONE SHORTSALES

REO/Other

8

Active Inventory by Price Range

589

505

126

296321

20

218178

370 371

0

100

200

300

400

500

600

700Jun-11

Jun-12

Jun-13

Jun-14

9

Home Sales

120160200240280320360400440480520560600640680

# Listings Sold

10

Historical Sales Trends

0

100

200

300

400

500

600

700

800

Jun

-05

De

c-0

5

Jun

-06

De

c-0

6

Jun

-07

De

c-0

7

Jun

-08

De

c-0

8

Jun

-09

De

c-0

9

Jun

-10

De

c-1

0

Jun

-11

De

c-1

1

Jun

-12

De

c-1

2

Jun

-13

De

c-1

3

Jun

-14

1st Homebuyer’sTax Credit Deadline

Lenient Lending Practices

No Artificial Influence

11

What’s Happening to Home Prices ?

$100,000

$130,000

$160,000

$190,000

$220,000

$250,000

Median Price - 3 Month Moving Average Trendline

12

Home Sales by Price Points

0

50

100

150

200

250

Jun-10 Jun-12 Jun-14UNITS SALES

13

New Pendings Vs. New Listings

050

100150200250300350400450500550600650700750800

New ListingTOTALS

NewPendingTOTALS

14

Sales vs. Inventory

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2200

SalesTOTALS

Net ActiveTOTALS

SALES VS ACTIVEINVENTORY

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Odds of Selling

11.5%

27.6% 31.1% 26.4%

69.7% 62.8%

45.9%

366

521594

524 503 519 559

0

500

1000

1500

2000

2500

3000

3500

Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14

Inventory

Sales

"Odds of Selling" - Absorption Rate

June 08 June 09 June 10 June 11 June 12 June 13 June 14

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The MIX – December 2008

Dec-08NONE

SHORTSALES

REO/Other

17

The MIX – December 2013

NONE

SHORTSALES

REO/Other

18

The MIX – June 2014

NONE

SHORTSALES

REO/Other

But Remember19

Overall Valuation Change

20

Builders Are Back

What you should know about today’s buyers

21

22

First-time Home Buyers by Age

39%

79%

36%

19%14%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

All Buyers 32 andYounger

33 to 47 48 to 57 58 to 66 67 to 87

23

Buyer’s View of Home as Investment

All Buyers

32 and Younger

33 to 47 48 to 57 58 to 66 67 to 87 88 and Older

Good investment

78% 85% 79% 74% 74% 64% 50%

Not Good Investment

6% 3% 6% 9% 8% 10% 17%

Don’t Know 16% 12% 15% 17% 18% 26% 33%

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Price of Home Purchased Compared to Home Recently Sold

Price of Home Sold Price of Home Purchased

Difference

32 and Younger $152,900 $250,000 $97,100

33 to 47 $205,000 $278,000 $73,000

48 to 57 $245,000 $259,000 $14,000

58 to 66 $220,000 $208,700 -$11,300

67 to 87 $199,800 $175,700 -$24,100

88 and Older $151,900 $181,800 $29,000

25

Size of Home Purchased Compared to Home Recently Sold

Size of Home sold Size of HomePurchased

Difference

32 and Younger 1,500 2,450 950

33 to 47 1,850 2,600 750

48 to 57 2,200 2,200 0

58 to 66 2,000 1,940 -60

67 to 87 2,000 1,800 -200

88 and Older 1,600 1,400 -200

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Characteristics of Home Purchased

32 and Younger

33 to 47 48 to 57 58 To 66 67 to 87 88 and Older

MedianPrice

$165,000 $235,000 $200,000 $185,000 $168,000 $191,000

Median Sq. Ft.

1,700 2,100 2,000 1,800 1,750 1,500

Median Year Built

1986 1991 1993 1995 1997 1991

27

Newer Home Availability

28

Reason for New vs. Resale Home

New Home 16%

Avoid renovations or problems with plumbing or electricity 32%

Ability to choose and customize design features 25

Amenities of new home construction communities 14

Lack of inventory of previously owned homes 10

Green/energy efficiency 6

Other 13

Previously Owned Home 84%

Better price 30%

Better overall value 28

More charm and character 17

Lack of inventory of new homes 9

Other 1629

2010 Homebuyer Demographics

0

50

100

150

200

250

300

350

Millenials (1980 -1996)

Gen X (1965 -1979)

Boomers (1946-1964)

Silent Generation(1925-1945)

G.I. Generation(1900-1924)

2010 <$200 K

2010 $200K - $500K

2010 >$500K

30

2011 Homebuyer Demographics

0

100

200

300

400

500

600

700

Millenials (1980 -1996)

Gen X (1965 -1979)

Boomers (1946-1964)

Silent Generation(1925-1945)

G.I. Generation(1900-1924)

2011 <$200 K

2011 $200K - $500K

2011 >$500K

Source: Western Title

31

2012 Homebuyer Demographics

0

100

200

300

400

500

600

700

Millenials (1980 -1996)

Gen X (1965 -1979)

Boomers (1946-1964)

Silent Generation(1925-1945)

G.I. Generation(1900-1924)

2012 <$200 K

2012 $200K - $500K

2012 >$500K

32

2013 Homebuyer Demographic

0

50

100

150

200

250

300

Millenials (1980 -1996)

Gen X (1965 - 1979) Boomers (1946 -1964)

Silent Generation(1925-1945)

G.I. Generation (1900-1924)

2013 <$200 K

2013 $200K - $500K

2013 >$500K

33

Financing 2nd Quarter 2012

37%

28%

6%

29%

Conv. Loan

FHA Loan

VA Loan

Cash

34

Financing 2nd Quarter 2013

41%

21%

7%

31%

Conv. Loan

FHA Loan

VA Loan

Cash

35

Financing 2nd Quarter 2014

47%

21%

7%

25%

Conv. Loan

FHA Loan

VA Loan

Cash

36

SUMMARY

Sales Mix

Sales Pricing Trends

Affordability

37

The % Sales Mix Trends 2013 - 2014

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%Ja

n-1

3

Feb

-13

Mar

-13

Ap

r-1

3

May

-13

Jun

-13

Jul-

13

Au

g-1

3

Sep

-13

Oct

-13

No

v-1

3

Dec

-13

Jan

-14

Feb

-14

Mar

-14

Ap

r-1

4

May

-14

Jun

-14

Jul-

14

NONE%

SHORTSALES%

REO%

38

Home Pricing Trends: Affordable?

$100,000

$130,000

$160,000

$190,000

$220,000

$250,000

Median Price - 3 Month Moving Average Trendline

39

Affordability….It’s All About The Payment !

$1

44

,71

8

$1

60

,25

6

$1

92

,67

8

$2

10

,52

6

$2

26

,75

7

$1

97

,23

9

$25,000

$75,000

$125,000

$175,000

$225,000

$275,000

$325,000

$375,0001

99

9

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

AffordablePrice

Median Price

$2

10

,08

4

40

$1,000 P&I

Payment

FINAL THOUGHTSSales Remain Healthy

Distressed Properties… Less of a Factor

Tesla…Feast ?

The Margins Tax… Famine ?

It’s Always About Affordability

41

Thank You

Reno/Sparks Association of REALTORS®

5650 Riggins Court, Reno, NV

775-823-8800

www.rsar.net

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