Carson City Housing Market Report February 28, 2023: Prices on the Rise Despite Low Inventory Due to Winter Weather
Carson City Houses
Right now, the median price for a single-family home in Carson City is $540,000, up 16.8% from last year. Looking at the data, that number has been on the incline week over week. Carson City saw big spikes near the end of the year, but it did not experience the big bubble of 2022. It didn’t really follow the national trends in the same way as Reno and Sparks, where we saw a huge gain in prices over quarter one, and the subsequent decline in quarters two, three and four. Aside from the occasional spikes, Carson didn’t have those big gains and losses, it has been rather level and for the second week in a row prices in the area have increased.
There are few new homes hitting the marketplace in Carson City, likely due to snow and freezing temperatures in the region. If you were to look at the overall trends, the numbers had been on a continual decline since May of 2022. There have been ebbs and flows in the weekly data, but overall it’s been on a downward trend. We saw some little spikes near the end of January, and it has been mostly flatlined ever since. That’s really affected the Carson market as there are just not enough new homes for buyers to look at.
Homes Under Contract
We aren’t seeing any really big spikes in pending properties. That has been on the decline since the end of April/early May of 2022. There was a small uptick around the new year, but not much – it’s maintaining at a pretty level pace, with nine homes sold last week.
Percentage of Asking Price
Down just a little bit, homes are averaging sales at around 96.2% of asking price. A good thing to remember though, is a lot of Carson City homeowners are offering seller credits to buyers to help them with their loan, leading many veterans to choose to purchase there. Oftentimes with their program they negotiate the ability to have the seller help with closing costs. They’ll offer a little bit more so the seller can give them back money to help manage their upfront costs. A traditional percentage of asking price is 3%. Last year, buyers weren’t getting closing costs, so the current numbers may be a little inflated because a lot of the percent of asking price may include that closing cost credit.
Weeks of Inventory
At present, Carson City has 8.1 weeks of inventory. That's really low. If you look at last year, between February and June when the real estate market was really hot, there was less than 10 weeks of inventory. So even though we had some serious volatility and a balanced marketplace for a moment there, the inventory was very quickly absorbed – clearly due to a lack of new listings hitting the marketplace. And now Carson is in the same housing shortage boat as Reno and Sparks.
Median Days on Market
Anytime we see the median days on market hover around the 30-day mark, we consider that a relatively normal market. Carson City is seeing a median of 42 days, which is pretty reasonable. Keep in mind, this housing shortage is not causing an increase in prices in the same way as we saw last year. Is it going to put pressure on it? Absolutely, as you have that downward pressure from the rising interest rates. There was hope that it was going to stay balanced for a while and maintain at the 6.5% mark, as the recession took its course. But because inflation is not performing at the rate the Fed wanted, they increased another quarter of a percent this last week and it is affecting the mortgage market. At the beginning of the year there wasn’t much movement in days on market, it remained pretty consistent. But as interest rates increased, it became really volatile, and we saw some huge peaks and valleys in the data – like a big pendulum moving back and forth. Overall, it’s on a downward trend, so that’s good news, and it’s proving that the sellers in Carson are serious. They’re starting on the right spot, pricing their homes at the top dollar market value, and not needing to do a lot of price reductions. That’s important for buyers to keep in mind as they are out looking at homes. Serious sellers are not market testers, they want to sell. And if their property is sitting on the market, it’s likely because they accidentally overpriced their home. Buyers should not be afraid to write an offer, as there is a strong chance the sellers are probably getting ready to do a price reduction – and what better time to stay ahead of other buyers? The best advice that can be given to buyers experiencing such limited inventory is to expand their search into a higher price point. For example, if their budget is $400,000, they should start looking at homes that are priced around $425,000, perhaps even $450,000 – particularly those that have been sitting a little while. Those sellers may be considering a price reduction down into a lower range, and if a buyer can sneak in there and write an offer before they do, they may be more likely to negotiate a successful agreement.
Carson City is seeing an increase in home prices, but there is still good news for buyers as many sellers in the area have been willing to offer credit that helps to cover closing costs. Inventory has diminished and thus created a housing shortage that compares to the Reno and Sparks markets. Further exacerbating the shortage and the slowed marketplace is the continued influx of inclement weather, as the persistent snow and ice has prevented many sellers from listing their properties. However, we have heard a lot lately from numerous interested sellers and we have strong reason to believe the forthcoming warmer temperatures will bring forward many new listings to the market.
Post a Comment