ANNOUNCING: The tide has changed--it's a buyer's market!

Downtown Reno: Beside Century Theaters Riverside and SIlver Peek Grill

Summary: The tide has shifted.  It's a buyer's market for people looking into buying a home in Reno-Sparks.  "But that's old news, Joe!" Yes and no.  Not for lower end homes until recently.  In this post I share how you can benefit from it.

Back in 2008 the Reno-Sparks market slowly turned into a seller's market for starter homes $170,000 and below.

Many questioned my "theory".  I told them they didn't have to look far; They just needed to open their MLS (multiple listing service) and see that supply of homes in Reno-Sparks were at a five year low.  This was unexpected because the whole Country was experiencing high inventory of homes.

"The housing problem does not get fixed until we clear the inventory," said Nicolas Retsinas, director of the Harvard Joint Center for Housing Studies

Last summer, I was bidding above asking price for some lower priced homes--especially foreclosures. There just wasn't enough homes:

While demand was soaring to a five year high! : 

How can that happen? Investors and first time home buyers wanted the same thing.  While Banks (foreclosures) gently unloaded their foreclosures in the market--so as not to plunge the value of homes, regular sellers were hoping for the market to recover--they didn't want to sell, banks made it hard to borrow loans and locals can finally afford buying a home.  All these factors created GREAT demand. 

But the tide has shifted.

Yes, supply is still low.  Demand hasn't gone down drastically.  But there seems to be more choices out there even in starter homes.  I don't know the exact cause--could be a mixture of the expiration of the $8,000 tax credit and Banks unloading foreclosures at a faster rate.

Reno foreclosures continue to go up, creating more choices for buyers:

I discovered this when I took my buyers out last week.  Here's what they were looking for:

• $200,000 and below
• South Meadows/ Damonte Ranch Area--MLS area 143
• 3+ bedrooms/ 2 bathrooms

Guess how many homes showed up? 45 available homes. 9 foreclosures. 29 short sales. 6 regular sales ('equity sales').

That's a lot of homes.  Last summer, I'd be semi-lucky to be the first offer among the 10 available homes.  Take note that this area is one of the most sought after areas in Reno.

 What this means for you as a buyer:

• You can be more aggressive with your offers.

• Avoid getting attached to an area that may not have enough supply of homes (remember supply in general, is still low).  There are other areas that can accomodate what you are specifically looking for.  

Example: if you can't find enough homes you really like in Northwest Reno, it may be a good idea looking at some homes in South Reno.  You may be paying $20,000-$60,000 more but the benefits could outweigh the higher price tag. 

• Competition for foreclosures is not as strong.  If you don't want to wait, you don't have to.  Short sales still take a while.

• Less likely to have multple offers situation.  No rush in making a decision.