Home prices post dramatic increase
July 11, 2017
Home prices in western Nevada are rising dramatically — but not as fast as sellers want them to.
The average home sold during the second quarter of 2017 was bigger and more expensive according to figures released by the Douglas County Assessor's Office.
Average sales prices for homes in Carson Valley jumped nearly 7 percent compared to the year's first quarter to $393,643. The average size of a home increased to 1,976 square feet.
That's the highest average sales price since the first waves of the Great Recession in December 2007.
In the first half of 2017, 443 homes were sold in the Valley, up from 431 during the first six months of 2016, which ended up seeing 941 homes sold. Of those, 845 were five years or older.
Steve Bohler, president of the Sierra Nevada Association of Realtors, said the average price of a Carson City home has increased by $51,000 since January and by about the same in Douglas County. The average sale is up by $38,000 in Reno over that same period.
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But Bohler said that's not as surprising as what owners are asking for when they put a home on the market.
He said the gap between the average asking price and the eventual sales price is especially large in Douglas County. The average sales price there was about $350,000 in 2016. It grew to $401,800 so far this year.
But Bohler said the average asking price in Douglas is a whopping $608,000 — just shy of $200,000 more than what those homes end up selling for.
"That's some crazy numbers," said Bohler, who has been in real estate 40 years.
Douglas County isn't the only place that gap is huge. In Reno, he said the gap is nearly as large. There are 1,911 homes on the market now and 959 pending sales in Reno. Owners are asking for $569,452 but the average sale price is $376,000.
Edgewood Co. has the second highest valuation in the county with $32.35 million.
By comparison, he said Carson City looks much more normal. In the capital, there are 217 houses on the market with an average ask of $383,300. Actual sales, so far this year, are averaging $318,000.
He provided the analysis after being asked about a national report from Black Knight Financial Services that said Reno and Carson City are both in the nation's top 10 for housing price increases so far this year.
Nationally, that report said the Home Price Index is $275,000, up 3.6 percent since January.
His numbers, he said, are from actual sales data in Western Nevada.
Asked if those kinds of price increases are sustainable, Bohler said yes for now, "because we were so far down previously." He predicted the situation would correct itself, preventing another collapse like what happened 10 years ago because, now, "we've kind of got the controls on it."
"Things have slowed down quite a bit because prices are up too high," he said. "How can you justify telling a buyer to buy this?
"I think prices will adjust themselves."