The Builders Association of Northern Nevada "Forecast 2013" at the Atlantis was more of a celebration this year. There's been a turnaround in our housing market, sooner than many expected. Visiting national economist Elliot Eisenberg told Reno's builders, "You hit bottom, you're bumping along, and in some measures you're going up. House prices are going up."
That they are…up 20% in just the past 12 months. The median sales price for Reno-Sparks now stands at $187,000…the highest it's been since early 2009. And with only about 500 available houses for sale, there's now just a 4-week supply of inventory. It's actually hard to find a for sale sign now.
The boost in prices and lack of available homes are both boosting hopes for new home construction. Mike Dillon of the Builders Association told us, "I really feel that this year, we are going to have an uptick and increased activity in home construction." That's great news for construction workers who really need jobs. As for home buyers, he told us "Interest rates are super low and it's kind of a buyer's market."
It probably is one of the best times to buy, but it isn't easy to do it. At Marcus and Millichap Real Estate Investment Services, Todd Blonsley told us too many buyers are getting outbid by investors with cash. "Because there's not the question of contingencies, not the financing contingencies, not the underwriting requirements. Banks have really clamped down on underwriting borrowers."
There's also been a clamp down on foreclosures from AB-284, the recent state law that makes it much more difficult to foreclose. Blonsley says as a result, there's a huge shadow inventory out there. He told us, "It seems like there's thousands and thousands of houses sitting there vacant, either in the foreclosure process, or that have become bank-owned."
Once they hit the market, the glut could sink values once again. Those are problems. But we've had bigger problems before, as visiting economist Elliot Eisenberg told us. He says local builders have "survived the worst. The 7 years of famine are over…the Egyptian-type famine is over. They've been successful."
For 2013, things look okay. Not great, but it feels okay.
Thursday, May 23 2013 2:59 AM EDT2013-05-23 06:59:26 GMT
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