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When it comes to the state of Nevada, most people immediately think of Las Vegas. Thanks to its growing real estate market, huge tourism industry, and popularity in the gambling sector, many people with buying power look forward to that area.
However, another city that is proven to have had more population growth recently is Reno (and Sparks, its attached town). The Reno metropolitan area is currently home to about 500,000 residents (and growing), so this could be an excellent opportunity for those who want to invest.
Is the current market in Reno good for you? Or should you look somewhere else? This page has all the answers.
Keep reading to know more about the Reno-Sparks market and whether it's a suitable option for the average homebuyer.
Trends About the Reno Real Estate Market
Does Reno offer a balanced market? To know for sure, all you have to do is evaluate recent trends to see how the market has behaved over the past few months in comparison to last year.
Median Sales Price
In March 2023, the median home sales price dropped to $500K. Overall, the market experienced an 8.3% drop compared to last year. However, if you compare it to data from just a couple of months ago, you will see that the market is slowly recovering.
To put things in perspective, January 2023 had a median price of $465K, which implied a 15.6% decrease year-over-year.
The median home price, on the other hand, is currently at $555K.
Number of Homes Sold and Median Days on the Market
About 270 homes were sold in Reno in March 2023; a 29.5% drop compared to last year.
On the other hand, most homes in Reno, NV, sell after 68 days on the market. In March 2022, most homes sold after 21 days, which means there's a 47-day difference to consider.
Sale-to-List Price
The current sale-to-list price in Reno is 98.2%, which suggests a decent balance between buyers and sellers. However, Reno experienced a 3.6-pt drop compared to last year. In March 2022, the sale-to-list price was 101.8%.
Homes Sold Above Listing Price
18.5% of homes in Reno, NV, sold above their listing price; a 38.1-pt decrease compared to last year.
Homes Sold Below Listing Price
On the other hand, 22.6% of homes in Reno were sold below their listing price. This means that buyers may have the upper hand when negotiating better prices for existing homes in the area.
Which Factors Affect Home Sales in Reno?
Let's take a look at some factors that can affect the real estate market in Reno today. Overall, you can expect changes in the market due to:
- Economic Activity
- Demographics
- Government Intervention
- Interest Rates
However, it's safe to say that currently, Reno is an excellent option for real estate investors, and here are a few reasons why:
Economy
Job growth in Reno has outpaced the national average, promoting economic activity in the area. Thanks to the rising economy in this city, there has been an increased demand for housing. If you're a real estate investor looking for the perfect opportunity and reasonable home prices for the area, then this may be a great place to start.
Tax Environment
Nevada is known for having a business-friendly tax environment. Overall, you will have low taxes and no state income tax. Thanks to this environment, investors could enjoy higher potential returns on their purchases.
Moreover, this friendly tax environment makes reno more attractive for businesses, which drives the housing demand even higher.
Tourism
Even though many people have Las Vegas as their go-to option, Reno is also a popular tourist destination, as it includes different attractions like Lake Tahoe and Reno Air Races. If you're looking to invest in vacation homes, for example, then Reno could be an excellent opportunity.
Rental Market
Due to the rising home values, many people are considering renting instead of buying. If you're looking to generate passive income, then investing in a Reno property could give you decent returns.
Proximity to Major Cities
An excellent thing about Reno is that it's near other major cities in the U.S., such as Las Vegas, San Francisco, and Sacramento, which can make it a more attractive option for some investors.
Is the Reno Housing Market Going to Crash Soon?
Many experts believe that there could be a decline in home values during 2023 and into 2024. However, the decline isn't likely to be significant enough, so there are no signs of the market going through a crash soon.
On the contrary, the market is expected to remain 'stable' over the following months, so if you're looking to invest in properties in this city, this may be a good time to do it. Due to the recent drop in property values, sellers may be willing to sell, so buyers will have the upper hand when negotiating a better price.
Statistics About the Housing Market in Reno
Let's take a look at some general statistics surrounding the Reno real estate market:
- From February 2023 to April 2023, about 60% of buyers wanted to stay within Reno's metropolitan area, whereas the other 40% wanted to move out. Even though this isn't too much of a difference, it seems more people are looking to invest in Reno.
- Approximately 20% of homes in Reno are at risk of flooding, which may put off some buyers.
- Skyline Boulevard is the most expensive neighborhood in Reno, with a median listing home price of $909K. On the other hand, the cheapest neighborhood in the city is Virginia Lake, with a median listing home price of $207.2K.
- On average, properties purchased in Reno a year ago have appreciated by $43,752. The national average for the same period was $15,753.
- The unemployment rate in Reno for March 2023 is 4.40%, which is an increase from the 3.10% rate in March 2022.
- As of May 2023, the interest rate in Nevada for a 30-year fixed mortgage is 6.98%.
Market Predictions for the Housing Market in Reno
Generally speaking, the Reno MSA (Metropolitan Statistical Area) is expected to decline by at least 1.6% by February 2014.
Considering the data available, Reno is currently in a moderately competitive market, and it's expected to remain relatively balanced over the following months.
Despite the expected decline in property values, Reno is still considered a great investment option, as there may be plenty of opportunities for both buyers and sellers.
Bottom Line
Reno is becoming a 'hot' market for many investors around the country. The market is generally balanced, and due to its increasing popularity, it's only a matter of time before the demand for housing increases even more.
If you're willing to invest in a Reno property, then you can expect decent returns, as long as you make the right decision.
FAQs
What Is the Real Estate Market Forecast for Reno in 2023?
Home values in Reno are expected to keep going down a bit over 2023. However, the decline in value shouldn't be enough to worry anyone; Reno will likely remain a competitive market and a decent option to invest in.
Is Reno Getting Expensive?
In a sense, the average home values in Reno are lower than last year, but that doesn't mean this city is cheap to invest in. Generally speaking, Reno's homes are valued much higher than in other major cities, and although it's not getting more expensive right now, it's not necessarily "affordable" either, which is why some people are looking to rent.
Is Reno a Good Place to Invest Today?
Considering what the general data says, it would be safe to assume Reno is a seller's market. However, we believe the market is balanced enough to offer excellent opportunities for both buyers and sellers.
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