Market Trends Report: 3rd Quarter 2022

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MARKET TRENDS

3rd Quarter Market Report from the Market Leader

Reno/Sparks Market Overview

As we head into the fall months of 2022, we are beginning to experience the effects of higher mortgage rates, global geo-political and stock market instability. Historically speaking though, demand is still strong in our region. Sellers should work closely with a professional REALTOR to establish a realistic pricing strategy when going to market with their homes. Keep reading for the latest info on the single-family home market in the Reno/Sparks area.

As of October 2nd, 2022, there were 1,276 homes available for purchase, which is a slight increase of 1.2% from last month. Although this represents an increase of about 136% in standing inventory for the region compared to this time last year, it is important to remember that we were in a severe housing inventory crisis at this time in 2021. So, an increase in inventory is realistic and is welcomed by buyers and real estate professionals. Buyers now have more choices and additional time to make informed decisions before submitting offers. This benefits sellers too.

Months of Inventory is the amount of time it would take to sell all existing homes for sale if no additional homes entered the market. A five to six month supply of homes historically represents a balanced market, where neither buyers nor sellers have an advantage. For homes priced under $400,000, we have 1.8 months of standing inventory in Reno/ Sparks, or 12.5% more than that of last month. For homes in the range of $400,000 to $700,000, inventory is about 2.3 months.

For the inventory of homes priced in the mid to upper price ranges, we have:

• 3.2 months of inventory in the $700,000 - $1,000,000 price range

• 3.7 months of inventory in the $1,000,000 - $1,500,000 price range

• 6.6 months of inventory for homes priced over $1,500,000

As of September 30th, our region has had 4,101 home sales so far this year. That is 14.8% less than the 4,816 sales we had at the end of September 2021. A small decrease in sales coincides with increases in mortgage rates. The decrease in sales is not believed to be a long-term problem.

Breaking down the home sales through the first nine months of this year, we see that:

• 71% of sales were under $700,000

• 18.4% of sales were between 700,000 and $1,000,000, and

• 10.6% of sales were over $1,000,000

Mortgage rates have been fluctuating recently, so be sure that you have been pre-qualified by a lender to understand how much house you can afford. A professional real estate agent with negotiation and market expertise is as important now as it has ever been, whether buying or selling.

Source: NNRMLS Residential listings/sales, area 100

Is Selling Or Buying A Home In Reno-Sparks During A Recession A Good Idea?

With the Federal Reserve raising interest rates for the third consecutive time to tame inflation, and continued economic uncertainty around a potential recession, those who are buying a home in Reno and Sparks are facing a very different housing market.

Yet, different doesn’t mean disaster for first-time homeowners looking to enter the market or existing homeowners thinking about selling.

Here are a few considerations for Northern Nevadans to navigate today’s housing market.

How To Navigate Selling Or Buying A Home In Reno-Sparks During A Potential Recession

First, a recession doesn’t equal a housing crisis. Whether we’re in a recession or teetering on one, this housing market isn’t a bubble that’s about to burst.

What we’re experiencing in Reno/Sparks tells us it’s not a bad market; it’s a different market. We’re not facing the same crisis witnessed in 2007-2009 due to high-risk mortgages and extinct lending practices.

Historically, there’s proof that when the economy slows down, it doesn’t mean home values will depreciate. What we’re seeing now is an increase in residential housing inventory, more moderate buyer demand, fewer bidding wars, homes selling below asking price and buyers having more leverage to negotiate. With increased inventory, buyers have more options and time to find what suits them, rather than compromising. Now is the time for sellers to price appropriately and consider concessions to incentivize buyers’ interest. But there’s no doubt we’re all anticipating the Federal Reserve’s next moves. Jerome H. Powell, chair of the Federal Reserve, has signaled that interest rates are likely to continue increasing for the purpose of curbing inflation.

Higher interest rates and larger mortgage payments aren’t ideal, but as uncertainty around the future increases, it may serve some consumers to lock in the “devil that you know,” now.

Clearly, there’s no “housing market crystal ball” and no guarantee for what the Reno/ Sparks housing market will look like months or years out and whether buyer demand and housing prices will increase. Consumers must assess current market conditions and how best to meet their needs.

If a recession hits (if we aren’t there already), the Feds best bet to fight it is to bring the rates down. For a homeowner, that means embarking on the path of refinancing. What a homebuyer will make back can create a cash opportunity from a home’s value to use toward other costs.

In contrast, if you’re renting, you’re at the behest of market volatility, rising monthly rental rates, a landlord’s business decisions, and lease terms. The option of refinancing a rental payment during a period of reduced interest rates is not an option. Not to mention, the economic cool-down effects that interest rate hikes are intended to accomplish won’t be felt within the rental community for at least a year. Some renters are considering buying a home in Reno-Sparks, moving to a locked mortgage payment as one way to save money in the long run.

Homeownership grants a few other perks, too— namely stability, tax write-offs, and investment. For those who don’t have retirement plans, real estate is a great investment, and the earlier you invest, the better off you’ll be due to appreciation. If not retained for retirement, that appreciation could even allow you to upgrade into a better property.

Those unsure if they have enough for a down payment on a home purchase can consider the many down payment assistance programs available.

Navigating the housing market during today’s uncertain times is not for the faint of heart. Whether you decide to buy, or sell, consider your options and what’s best for you now and in the future.

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Incline Village Market Snapshot (Data source: Incline Village REALTORS®) Incline Village/Crystal Bay - Single Family Homes 2022 2021 3rd Quarter 2022 vs. 3rd Quarter 2021 Available Homes Units Sold Days on Market Median Price AVAILABLE HOMES 65.4% FROM LAST YEAR UNITS SOLD -19.1% FROM LAST YEAR DAYS ON MARKET 55.2% FROM LAST YEAR MEDIAN PRICE 32.4% FROM LAST YEAR 81 47 58 134 38 90 $2,582,500 $1,950,000 Incline Village/Crystal Bay - Condos 2022 2021 3rd Quarter 2022 vs. 3rd Quarter 2021 AVAILABLE CONDOS 16.9% FROM LAST YEAR UNITS SOLD -40% FROM LAST YEAR DAYS ON MARKET 24.3% FROM LAST YEAR MEDIAN PRICE 28.4% FROM LAST YEAR Available Condos Units Sold Days on Market Median Price 65 50 52 76 30 64 $1,091,825 $846,750

Hungry? Try Something New At One Of These Incline Village Restaurants

Incline Village restaurants serve some of the best dining North Lake Tahoe offers—no matter what you’re in the mood for. The best part? There are plenty of locations to choose from, each offering something unique. Here are our top recommendations to try this fall.

Incline Village Restaurants to Satisfy Your Next Food and Drink Craving Big Water Grille – Fabulous Fine Dining

This Incline Village restaurant located near the base of Diamond Peak Ski Resort offers creative cuisine, delectable desserts and incredible panoramic views of Lake Tahoe and the surrounding Sierra Nevada.

Executive Chef David Dubnick’s seasonal, California-inspired bistro menu features steaks, game and seafood, as well as vegan and vegetarian options.

Must-try starters include Jumbo Lump Crab Cakes served with a house-made rémoulade, or the “KFC,” short for Korean Fried Cauliflower, which comes with a house-made spicy chili sauce, green onion and sesame seeds.

Main courses are where Dubnick’s culinary prowess truly shines. Mouth-watering favorites include:

• Alaskan Halibut with garlic jasmine rice, sautéed asparagus, pineapple/white corn salsa and a citrus beurre blanc.

• Vegan Enchiladas with vegan mozzarella, pecan hummus, pepitas, tomatillo salsa, butter beans and Spanish rice.

• Braised Beef Short Ribs with creamy polenta, rainbow chard and pan jus.

Meanwhile, an extensive wine list showcases over 100 high-quality and delicious varietals from around the world that pair wonderfully with the cuisine, as well as a full bar with original cocktails and craft beers.

Both the view and food will take your breath away at Big Water Grille, an ideal setting for a romantic date night, special family gathering, or important dinner meeting with a long-standing or prospective client.

Austin’s Restaurant & Bar – Fast Casual Fun

Located on Country Club Drive across the street from the Hyatt Regency Lake Tahoe, Austin’s Restaurant & Bar prides itself on offering “comfort food for the soul.”

The menu features seasonal, locally sourced organic ingredients, produce and seafood. Austin’s is wellknown for its commitment to the environment by supplying disposable service ware, from straws to takeout bags, that is biodegradable and compostable, in addition to using trans-fat-free oil to make biofuel.

Signature dishes include Chicken Fried Chicken or Chicken Fried Steak, huge salads (believe us, when we say “huge,” we really mean it!), and the Austin’s Style Chicken Sandwich that’s grilled and seasoned with a house-made rub. Plus, you can’t go wrong with an order of Austin’s trademark buttermilk fries served with a delicious jalapeño aioli.

Aside from wine and beer, Austin’s offers plenty of signature cocktail pairings to go with any meal. Highlights include:

• C.F.B. Bloody Mary with vodka, house-made bloody mix and chicken fried bacon.

• Pecan Old Fashioned with pecan-infused bourbon, bitters and cinnamon-infused simple syrup.

• Southern Sweet Tea with cucumber-infused vodka, agave nectar, iced tea, mint and a lemon wheel.

Looking to feed a crowd? Austin’s offers a special bulk take-out menu of sandwiches and salads perfect for casual luncheons, birthday parties, business meetings, office lunches and family gatherings.

Open daily from 11 a.m. to 9 p.m. (11 a.m. to 4 p.m. on Sunday) and with a friendly outdoor patio, Austin’s is a great destination for a relaxing business lunch or dinner for everyone.

Nevada Jane – A New Twist on an Old Favorite

A relatively new addition to the North Lake Tahoe restaurant scene, Nevada Jane recently reopened in the heart of Incline Village in the Raley’s Shopping Center complex at 930 Tahoe Blvd.

Formerly known as Gus’ Open Pit Barbecue, Nevada Jane was acquired in 2021 by restaurateurs Jonas and Nellie Saia, who own three other Incline Village eateries: Austin’s, casual American restaurant Fumo and coffee/ice cream shop, Cool Mess.

At Nevada Jane, the Saias collaborated with Chef Henry Nol to create a menu that focuses on sustainable seafood, open-fire barbecue prepared with the Santa Maria cooking method and an inspired take on street food. The result is an elevated menu featuring a bevy of options, including:

• Shareable plates such as shrimp tostadas with slaw, pico de gallo and barbecue sauce; grilled corn cob elote with honey, cotija and salsa seca; and pickle frites with a house ranch sauce.

• Barbecue-inspired main courses such as pork belly with whipped burrata and watermelon; sweet chili and cilantro-glazed chicken quarters; and pork or beef ribs served with house slaw.

• Carnitas, carne asada, fish or mushroom street tacos, in addition to handheld favorites such as smash burgers and an habanero honey-infused fried chicken sandwich.

Nevada Jane also offers a special happy hour menu from 9 p.m. to midnight on Fridays and Saturdays in its Loft Cocktail Lounge that caters to socialites and foodies seeking late-night cravings.

With its refreshed take on barbecue and street food fusion, Nevada Jane is a welcome addition to the Incline Village dining scene.

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