Reno-Sparks Home Prices Index: 1979 - 2010

(Click image to enlarge. Raw data taken from Federal Housing Finance Agency.)

In this post I want to show you the yearly percent change (taken from 4'th quarter results) of house prices in Reno-Sparks from 1979 to 2010.

Key Takeaways:

• The dramatic rise and fall of the Reno-Sparks housing market the last 10 years has never happened since FHFA started tracking results in 1979.  I highly doubt it if anything like this happened in the Reno-Sparks real estate market before 1979.

• If you look at the raw numbers divided per quarter, the decline in home prices in Reno and Sparks started in the fourth quarter of 2006.  It has not turned positive ever since:

• Even though demand has been going up the past few years, the above image clearly supports the widely known fact that Reno home prices are still struggling.

• That being said, it is also worth noting that the last two quarters (2nd and 3rd -- 2010) the prices have only been down -9.94 and -10.28.  The two best quarters since 2008.

• If and when the Reno-Sparks market comes back up to positive territory, it is unlikely that home prices will go up more than the 5% per year appreciation.  In short,  don't expect for home prices to go up like it did in 2000-2005.

It's been almost six years since the last time a home in Reno or Sparks hit the positive equity mark.  You can see the above graph as half-empty or half-full.  Is there a real possibility of a double dip in home prices? Meaning, the 2008 (4'th quarter) low of -18.17 could happen again, possibly even worst? Yes, that could happen with the lingering stench of local unemployment (highest in the nation).

But basing on the same set of numbers, is it also fair to suggest that the absolute bottom of the Reno-Sparks real estate market possibly took place at the same time in 2008 (4'th quarter) at -18.17?  I think that's a real possibility too, until the market disproves it by going lower (double dip). 

As always, this is where my job screeches to a halt.  I'm not here to make a final judgement of the market.  Every buyer and seller has a unique financial standing and at the end of the day you know what's best for you.  But I really hope that you were enlightened about what's been happening in the last 31 years with Reno-Sparks home prices, and, equally important, how it could influence Reno-Sparks real estate future.