With all the volatility in the financial markets, more northern Nevada home buyers are lining up at the closing table. In west Reno, REMAX realtor Pam Reese gave us a tour of a home she's selling, telling us, "It's four bedrooms, 3 and a half baths. It’s listed at $850,000.” It’s a beautiful home with an updated kitchen, a bar in the living room...and outside, 2 huge decks. As Pam told us, "You can see the downtown from this way, the valley from this direction." It came on the market just 7 days ago. But if you're interested, you're already too late. It sold, in just a week.
Yes the sellers’ market is still going strong, with Reno prices up 12% from a year ago. The median sales price is up 17%…it went up another 5% just last month, taking Reno right up to that $300,000 mark again. It’s now at $291, 990. One reason is the lack of homes for sale. Pam says she'd have more sales if she had more homes to sell: "Absolutely. Absolutely. They'd fly." The inventory of houses on the Reno-Sparks market is near rock bottom. Pam says, "We have about 3 months-worth of inventory, which is really low." On top of that is the new threat of rising interest rates. As she told us, "If they're knowledgeable enough, they're very worried."
For the last few years, mortgage rates have been at some of their lowest levels on record. That allowed a lot of Nevadans afford a home. But the Fed says job growth could trigger steady mortgage rate increases, and that makes a lot of potential homebuyers…antsy. Pam tells us, "I had a little condo on the market. One day, I had 5 offers...all cash."
But higher finance costs mean fewer folks can afford to purchase a house. That's especially true with home prices so high. As she put it, "The price is high...the cost of buying is too high." Which could finally cool down an overheated market, which is quickly approaching another bubble.
