Reno New Home Sales Market Report -- 2007 to 2011

ONE OF THE NEWEST FEATURES we've added in this blog is the ability to search new homes in Reno. 

Back in 2007 I decided to track the new home industry both locally and nationally; as I've said in the past, home builders in bad real estate times are brutally honest and straightforward in their assesment of the market.

I really enjoyed this new found frankness from them because mainstream media and even most real estate professionals were bullish on the market even in late 2007! You didn't have to have a master's degree to know that in 2007 the market wasn't going anywhere but down. 

As early as 2006 the down market trend showed itself clear (see graph below.)  Don't buy the general misconception that we can never tell what the market is going to do.  Baloney.  We can never tell exactly what will happen or when, but the market gives us solid clues to where it's headed.  You just have to pay attention.  Here's an example:

Reno-Sparks and Washoe County Housing Starts & Building Permits:

Looking at the above graph, I can't help but wonder if the residentail contractors are not applying for new permits, not building new foundations, then what is this telling me?! 

Here's what's coming from the home builders association at that time (around 2007):

• "Builders' confidence at all-time low
  Home builders see weakest buyer traffic in 23-year history of trade group survey, outlook for future remains at record low as well."

• "The trade group's statement said the problems included decreased availability of subprime mortgages, a glut of new homes available for sale and reports about declining home values."

• "Mortgage crash hits new home sales
  Sales hit 7-year low as lower prices can't clear out huge glut, new government report shows."

Now, builder's sentiment seem to be improving, albeit, still way below the average.

• The National Association of Home Builders (NAHB) reports the housing market index (HMI) increased in November to 20 from 17 in October. Any number under 50 indicates that more builders view sales conditions as poor than good.

• “While this second solid monthly gain on the builder confidence scale is encouraging, the overall measure remains quite low due to the many challenges that home building continues to face with regard to the high number of foreclosures, the difficulties of obtaining construction financing and accurate appraisals, and the restrictive lending environment that is discouraging potential buyers,” said Bob Nielsen, NAHB Chairman and a home builder from Reno, Nev.

Here's the latest national new home sales graph:

• "New home sales increased from 296,000 in August to 313,000 in September, an increase of 5.7%. Briefing.com consensus expected new home sales to increase to 300,000."

• "The large supply of distressed properties has caused a historic spike in the spread between new and existing home prices. Until home prices become more attractive to home purchasers, the new home sector will continue to languish even if existing home sales rebound."

On an interesting note, apartment permits are surging.

"Over the past year, apartment permits have surged roughly 63 percent. Single-family permits have increased just 6.6 percent in that span. "

I couldn't agree more as local apartment vacancies in Reno-Sparks has been dropping the last few quarters.  Renting has become a preferred option for many Americans who lost their jobs during the recession and were forced to leave their homes.

Currently, In Reno and Sparks real estate market, the latest numbers are less than thrilling:

The above data coincides with the information given to me when I met with every Lennar New Development sales manager in Reno-Sparks last summer.  Sales are not great but they also told me that people are buying new homes amidst the bottomed out prices of competition -- mainly short sales and foreclosures.

If you're looking for new homes in Reno, you can start here:

• Reno New Homes: (6 things to Know )

• New Homes in Reno Categorized by Price

• Reno New Homes Categorized by Community

• New Homes in Reno Special Offers