What to expect in northern Nevada this summer selling season
This year is off to an amazing start in the residential real estate world. Indicators we saw in the beginning months of this year were promising, not only in our local market but nationwide. The National Association of Realtors (NAR) reported that the existing-home sales increased 3.3 percentage points, to a seasonally adjusted annual rate (SAAR) of 5.69 million. This shows an increase from the 5.51 million reported in December 2016.
The median price of existing-homes also saw an increase, rising 7.1 percent. This shows that people are feeling resilient and more confident about buying homes. Indicators also show a boost in inventory nationwide, with a 2.4 percent jump. However, inventory is still 7.1 percent below what we saw the same time last year. January 2017 marked the 20th consecutive month of declining inventory numbers. This spring, most markets are stagnant at a 3.6-month supply. Here in northern Nevada, we are sitting at four months supply of inventory. This means that if sales continue at the current rate, it would take only four months to sell all existing active and pending properties.
Because of the current state of inventory in our market, northern Nevada remains a sellers market. We are seeing new listings jump month to month, however that monthly increase is still down in comparison to years past. This spring we have seen a 28 percent increase in new listings, totaling 488. However, this number is down 16 percent from one year ago. Because of this trend, we are expecting the summer months to see low inventory.
We do expect to see similar trends in our sellers market as we did last summer. Those being multiple offer situations, over asking price offers and short days on market stats. Currently sellers are receiving an average of 98.5 percent of list price, which is a 0.5 percent increase from the previous year. We do expect to see this number increase or at least remain consistent through the summer. In order to compete in such a market, we always encourage perspective buyers to make sure that they have a very strong agent to guide them through what can be competitive situations. Buyers want to make sure that they have a strong negotiator on their side, as well as a solid offer. Both of these items can make all the difference in an increasingly competitive market.
Another trend we expect to see this summer selling season is the increasing number of buyers coming into the market. As Millennials are approaching their 30s and considering children and marriage, we are anticipating seeing an influx of Millennial buyers. More jobs are being created for this age group than any other, offering the financial stability and opportunity to invest in a home. Another age group that is expected to have a large impact this summer are the Baby Boomers. As Boomers approach retirement, they are relocating to be close to family or downsizing often from neighboring, more expensive markets.
As affordability remains a challenging factor in our market, we do expect to see home sales in our outlying areas increase, as potential buyers seek more options within their budgets. In larger cities nationwide, suburbs are anticipating that growth as well. As people begin to look outside our city limits, northern Nevada can also expect new construction to continue to increase in cost per square foot. Buyers looking to custom build on land increases the demand for contractors and construction crews, driving up costs.
With such a promising spring, we can only anticipate that this summer season will be even better than last. As northern Nevada continues to grow, it is more important than ever to stay informed.
Marshall Carrasco is the owner/broker at Marshall Realty.