High apartment rents in the Reno-Sparks
Don’t look for the rents to reduce anytime soon.
According to a report from Johnson, Perkins, and Griffin, second quarter data in 2015 indicates average rent for an apartment in the Reno-Sparks metro area is at an all time high — $920 per month.
Where is Reno in in our current market condition for real estate? Is this a good time to buy a house? Should I jump in right now? Should I wait?
If you were to ask a Realtor, the answer would likely be that we’ve finally reached the bottom and now we are in the long, slow, arduous climb back to where we “truly belong”. But, have you ever seen a time when a realtor didn’t say that now was a good time to buy? Couldn’t be a better time?
Me, neither. I’m not suggesting anything nefarious about realtors, here. I just think that if they’re not optimistic about their product, how could they do a good job, anyway?
But all of that is beside the point.
As the saying goes, “the reason for a horse race is a difference of opinion.”
Keith Jurow, writing in Businessinsider.com is firmly convinced that we are still headed for a housing collapse. He examined major markets across the country and found price declines. Exceptions were in Nevada, Arizona and Florida where we have already taken major hits. Foreclosures are way down in most areas but the number of delinquencies are still high.
We are still facing some very serious delinquencies. In many cases the problems were caused, or made worse by government action such as AB-284 here in nevada. This caused the banks to drastically slow their foreclosures. Consequently, the shadow inventories have grown substantially.
Nevada Foreclosure Filings: AB-284 Effective Oct., 2011
Jurow expects another significant drop in prices. Move-up buyers have disappeared because they lost most of their equity. First time buyers are usually limited to entry level properties. So, what’s left are the investors who are focusing on the “sand” states, which include Nevada. That may help us here in Reno.
Added to this we see a large number of potential sellers who, likewise, have little or no equity and are unable to sell. They may have taken out a HELOC or a cash out re-fi.
The bottom line is that I’m not optomistic.
Read more here.
I’ve seen rosy predictions before. I don’t know if real estate agents could do anything else. After all, their livlihood depends on it. Else, how could they sell something they thought to be a loser. And don’t assume by this that I think the agents fib about their marketplace. I’m not suggesting that at all.
So, I refer you to this article in NNBW by Kevin Annis about the Reno-area office market and I read it to mean that he thinks things are looking up.
Northern Nevada businesses will realize the worst is behind us. I recognize that this is not a measurable prediction; however, it certainly is worth recognizing. Companies that have weathered the economic storm have made it past the worst of it and will begin reinvesting in local economy.
For me, maybe – and maybe not.
Read more: http://www.nnbw.com/ArticleRead.aspx?storyID=18719
Foreclosure starts are down all across the West Coast for December. Reduced filings were reported in California, Nevada and Washington. Nevada showed drops of 14%.
According to ForeclosureRadar the drops were due to the closing of trustee sale locations in California. Riverside County passed an ordinance prohibiting solicitation on all County property. California law only specifies that the location must be within the County where the property is located and must be published in the Notice of Sale. Nevada law states
2. All sales of real property must be made:
(a) In a county with a population of less than 100,000, at the courthouse in the county in which the property or some part thereof is situated.
(b) In a county with a population of 100,000 or more, at the public location in the county designated by the governing body of the county for that purpose.
Here in Reno trustee sales are conducted on the steps of the Court House on Virginia Street.
The slow down in Nevada was attributed to AB 284 which established new foreclosure rules requiring the lender and trustee to certify that they have done everything correctly.
“Nevada’s new foreclosure rules appear on track to bring a near complete halt to foreclosures in that state,” said Sean O’Toole, founder and chief executive officer of ForeclosureRadar.
“In the near term this will certainly help homeowners who were facing foreclosure, eviction, and potentially deficiency judgements. Longer term, we believe there will be unintended consequences for the state as business declines for the many real estate related companies that would normally service, resell and finance those foreclosures.”
We know that Nevada leads the nation in foreclosures but seldom with little supporting data.
This heat map from RealtyTrac shows the foreclosure data for Nevada county by county. One out of 177 housing units received a foreclosure filing in December, 2011. Washoe County had one for every 318 housing units. Surprisingly, Lyon County even topped Clark county with 1 for every 144 units. All this compares with 1 for every 634 units nationwide. Check it out.
The question arises, has the real estate market bottomed out? And is this a good time to buy? Can you compare buying real estate today to catching a falling knife?
If you ever wanted to see a super analysis of the real estate market check out this article by Jeff Harding. He covers the many aspects of both residential and commercial and what I read, it ain’t pretty. He has great information and much more than I could tell.
he bottom line on the residential market is that home values will continue to decline in 2012 on a national basis, and if, as we are forecasting, the economy continues to flatten or decline, there will be no good news next year. Again, as we know, there is no “national” market and each locality has its own dynamics. But these data will have a negative impact on home buyers’ attitudes about the housing market.
The bottom line on the CRE markets is that prices appear to be flattening, but there is a substantial refi problem continuing to overhang the markets. As the bulk of these loans need refinancing at their maturity dates, it is likely that many of them will not be able to replace their loans and will face the requirement to come up with additional capital or face foreclosure, thus delinquency rates will remain high, especially in the sub-Class A markets. This has been the story of CRE for the past four years and there are no economic dynamics that would change it.
It is unlikely that investors and home buyers will be willing to catch a falling knife.
As he mentions, this describes a nationwide market and the reality is that all real estate markets are local. What happens nationally may not be the story for here in Nevada or in the Reno-Sparks area.
The rate on the 30-year fixed mortgage reached a new record low of 3.91 percent. This marks the third new low this year. The 15-year fixed mortgage rate, remained unchanged at a low of 3.21 percent.
The exceptionally low rates and the depressed prices have created a superb buying opportunity, but the opportunity is lost for many potential buyers because of the difficulty qualifying for new loans.
With so many homes underwater here in Reno and Sparks very few homeowners can qualify for a re-finance. Additionally, Nevada’s real unemployment further reduces the chances to re-finance.
Read more: http://www.businessweek.com/ap/financialnews/D9RPKO100.htm
Canadians must think Las Vegas is a good place to invest. Else, why would they be putting their own money there?
The reality is that Candadians are investing in Las Vegas, big time. Do they know something that we don’t? Or, are we so close to the problem that we can’t see the opportunity.
“Where in Canada can you currently buy a $50,000 property that you can turn around and rent for $1,000 a month?” says real estate broker Steve Martel of Martels Real Estate Inc. in Ottawa, who specializes in the U.S. realty market.
This may be an idea for investing – or or may also be an indication of opportunities here in Reno.
What do you think?
read more: http://www.calgaryherald.com/business/Invest+real+estate/5611525/story.html
According to RealtyTrac, Nevada led the U.S. in foreclosures for 52 months in a row. Foreclosures jumped by 23% to an all time high.
One out of 97 homes received a foreclosure notice in the month of April.
The Las Vegas area was number one or the nation’s cities with one out of 82 homes.
And even though the foreclosures were up, the number of filings has decreased significantly.
Reno-Sparks was ranked No. 9 in the nation with one filing for every 183 households.
Read here for more foreclosure information.
Here’s a podcast with peter Padilla and Leslie Henderson discussing short sales.
Henderson & Padilla: Ease The Pain of Short Sales & zero down on the VA Mortgage! May 15, 2011 by NevadaRealEstateRadio