A new year, another new high for Reno’s median home price.
Reno welcomed 2020 by posting a record $430,000 median price for existing single-family homes in January, raising concerns once again about housing affordability. The previous high was $420,500, which was set in May 2019, according to the Reno/Sparks Association of Realtors.
Reno’s record-setting month was enough to push the combined Reno-Sparks median to $405,000, tying the record set back in July for both cities. This occurred despite flat numbers from Sparks.
The median price for an existing single-family home in Sparks in January was $369,000, which was almost unchanged from December. The RSAR numbers are limited to existing houses and do not include condominiums, townhouses, mobile homes and new single-family homes.
“Median prices are up from January last year, but we are also seeing a greater number of homes sold,” said Erika Lamb, president of Reno/Sparks Association of Realtors.
There were 253 homes sold in January, which is traditionally a slow month for sales. Although unit sales were down by 30% from December, for example, they were up by 6% compared to the same month last year. Sparks saw an even bigger jump in unit sales. The city’s 124 homes sold in January represent a year-over-year increase of 43%.
Robust sales activity continues to put the squeeze on Reno-Sparks housing inventory, with housing supply at less than two months. The metric is based on how fast the market’s inventory would be gobbled up at the current pace of sales if no other existing houses are added to the supply.
“January days to contract was down slightly to 69 days, telling us that properties are moving quickly,” Lamb said. “Inventory is still extremely low at 1.8 months of supply, which is why buyers are finding limitations with housing choices in the market.”
A new median price record also means that housing affordability will continue to be an issue for the Biggest Little City. Back in January 2017, the median price for an existing single-family house was $320,000 in the city of Reno. Since then, the median price has increased by 34%.
With wages failing to keep up, more and more residents are being priced out of the market. The number of Reno workers who can afford the median-priced home has dropped from 90% in 2012 to less than 50% in 2019, said Jeremy Aguero, principal analyst for data and analytics firm Applied Analysis, at a recent luncheon of the Economic Development Authority of Western Nevada.
Rents, meanwhile, also hit a record high during the third quarter of last year at $1,345 per month. The number represents a 64% increase from the beginning of 2012.
Supply is also tight in the apartment market, with vacancies just below 4% during the fourth quarter of last year.