Reno-Tahoe Housing Market Conditions - January, 2017
First Things First - I hope the New Year brings you everything you want, need, and are working towards - good health and happiness to you all!
We have been publishing a market report, The Greater Reno-Tahoe Real Estate Report, for several years. This report gets updated monthly. Over the last 12-18 months, I have 'missed' a number of months of writing a blog update and/or notifying our subscribers by email. During this time, the report has been updated every month, however. I have added some additional staff and will try to get a blog post up here each month along with an email notification, but, If I don't, the report will be updated each month on or around the 10th. You can always find the report at this link: Reno-Tahoe housing market conditions. All of the information in this blog post is available (in chart or table form) in the report.
2017 Housing Forecast
The 2017 housing market will continue along on the same trend line as we have experienced in 2016. The key themes of the 2016 housing market (with comments for what to expect in 2017) included:
- Moderation in Price Appreciation - While prices will likely continue to rise, the rate of appreciation is slowing to sustainable levels. For example, the Reno median single family home price appreciation for 2013 over 2012 was 30% compared to 13%, 16%, and 9% for the same metric in 2014, 2015, and 2016. This moderation effect is also driven by the affordability factor based on average income levels in the region. Check out our "Bubble Chart" on page 9 of the Greater Reno-Tahoe Real Estate Report to see a good historical view of this phenomenon.
- Low Inventory of Homes - While we still have low inventory levels in the lower price ranges, we have experienced an increase in inventory (this is directly related the moderating price appreciation) especially at the higher priced segments of the market. New home builders will continue to build homes to meet demand and play 'catch up' from the lack of new home construction during the recent economic downturn. While we are in this 'mixed market' based on the price segment, it is more critical than ever to consult your agent to really understand the market dynamic you are either buying or selling in.
- Continued Low Interest Rates - Rates remained at historical lows during most of 2016. Immediately after the Presidential election, rates did rise but have since stabilized. The consensus for 2017 is there will likely be increases to the interest rate as economic confidence increases. Again, the rising rates will damper or suppress the rate of price appreciation.
- Continued Local Growth - California Relocation: I do not have numbers to report in this area, however, we continue to see strong interest and movement of Californians to our region in our business. The primary groups of those relocating seem to be either retirees (or near retirees) and younger people getting started who are drawn to the region for outdoor recreation and living affordability.
- Continued Local Growth - New/Expanding Employers: While the region continues to attract companies, the big mover in this area is Tesla Motors. As of December 8, there was a report that Tesla has created 331 jobs which is far short of the projected 1,700 at this time. However, as the report indicates, the Company is aggressively hiring as battery production has begun. The original forecast was for Tesla to employ 6,500 people by 2020 when the plant reaches full production. Time will tell how much growth this will actually bring. For more general information on Tesla's location and other information, we do maintain an information page on our site as well.
Again, you can subscribe (free) to The Greater Reno-Tahoe Real Estate Report to get notices when each issue is published.
If you have any questions from the statistics or analysis in this post, please feel free to comment or give your CalNeva Realty agent a call.
Thanks for reading!
Broker - CalNeva Realty