NNBW Editor Column: by the numbers – housing in Reno
It’s no secret housing continues to be a major concern in Northern Nevada, so I wanted to take time this week to share my perspective on the matter.
A few weeks ago, when everyone was posting comical images of themselves as part of the popular “10-year challenge” on social media, I decided to take a different spin, writing the following on my Facebook page: “Let’s play the Reno median home price 10-year challenge! October 2009: $180,000 October 2019: $399,995.”
It was a tongue-in-cheek comment more than anything. It got a few likes and comments, we all snickered, and then we moved on with our day. In looking back at that post last week, though, that snicker turned into a sneer, almost, as I tried to make sense of the impacts a 122 percent uptick like that has had on my life now that I’m starting to finally think about buying a home.
Before I moved to Reno three years ago, I lived for nearly a decade in Incline Village, Tahoe Vista and Truckee, so massive median price increases aren’t a new concept to me. I still remember reading the weekly real estate section of the newspaper in Incline back in the summer of 2007, marveling at homes for sale on Lakeshore Boulevard for $10 million, $20 million … some even more.
At the time, I was 23 years old and had lived my whole life in a blue-collar Michigan farm town. That weekly real estate leafing was akin to looking forward to the Sunday comics, I suppose, except the only difference was that those cartoonish prices were very real.
When I moved to Tahoe that summer, I rented a cruddy A-frame home with three other roommates, each of us paying $400 for a total rent of $1,600, plus utilities. As the years waned on and I bounced around communities, two things remained the same: I always rented, and I always had at least one roommate. It was the only way I could afford to live.
Fast forward to 2020, and I’m still renting in Reno (though, I’m happy to say my lone roommate these days is my fiancé).
So it’s with that as a backdrop that I found myself almost eagerly awaiting the first round of real estate stats for Reno-Sparks to be released this month, just to see what sort of start 2020 will have.
As reported recently, the Reno-Sparks Association of Realtors report for January puts the median single-family home price in Reno at $430,000, which is up 13 percent from January 2019 and up 6 percent from last month.
For those keeping score, that equates to a 139 percent increase from October 2009.
Again, these increases shouldn’t be surprising — we’ve all read the reports and news stories and analysis over the years at how the numbers have slowly climbed. Still, at least for me, it’s quite a bit more shocking when you put it into a decade’s worth of context, especially when you look at other fluctuations since 2010.
As just one example, according to the U.S. Census, the adjusted median household income in Reno in 2007 was $64,380, and it was $57,123 in 2010. The current median, based off 2017 figures, is $61,360 — representing a 4.7 percent decrease since 2007 and a 7.4 percent increase since 2010.
Cherry-picked statistics or not, that’s quite a difference from 139 percent.
Now, as timing would have it, while I was working Friday on this column, I received a press release from the National Association of Realtors that detailed home sales for January 2020 across the U.S.
When looking purely at median prices, that figure in January was $266,300 for all housing types (including condos and townhomes), an increase of 6.8 percent from January 2019. Also, the January 2020 median price increase marked 95 straight months of year-over-year gains.
So again, for those keeping score: Reno’s median home price in January 2020 was $430,000, compared to $266,300 nationally — a 61 percent increase.
Now obviously, when looking at those numbers at face value, it’s not wise to compare. For example, let’s compare Reno to Detroit, where the median sales price in January was $215,000, according to media reports.
Despite it costing exactly twice as much to buy a home in Reno, I’d wager many people are fine with a higher cost of living here considering Northern Nevada’s economic and recreational benefits, not to mention better crime rates and transportation infrastructure (look, I love Detroit, but I’m just being honest here).
And of course, you’re going to get a completely different side of the coin when you compare Reno to San Francisco, where median housing prices hover around $1.4 million.
To be sure, these examples (and you could make countless more) are pretty much the definition of apples-to-oranges comparisons, but the numbers are there nonetheless.
So what’s my point with all this? Why am I spewing all these numbers? Why does it sound like I’m complaining?
To be clear, I’m not. I’m comfortable with the financial decisions I’ve made over the years that have gotten me to where I am today — ready to get married this May, and from there, ready to start house hunting in earnest.
Would I like for housing prices to be cheaper, or at least their ebbs and flows more commensurate of that of household wages and inflation? Of course, who wouldn’t?
Still, my point is that so much can change over the years, and while each person’s story is different, sometimes, it helps to conduct your own personal 10-year challenge to understand where you’ve come from and how hard you’ve worked to get here.
Of course, tongue-in-cheek or not, I’ll be personally rooting for the housing market to take a downturn over the next 12-18 months, once my house hunt truly picks up steam.
At least, that’s my perspective.
Kevin MacMillan is editor of the Northern Nevada Business Weekly. Reach him for comment at email@example.com.
Bryan Wachter of the Retail Association of Nevada said his organization is “very concerned about disruptions to the supply chain.”