Las Vegas Review-Journal (Sunday)
Residing in Reno requiring runaway riches
Median home price is 47 percent of earnings
RENO — Reno has become one of the top 20 least affordable housing markets in the U.S., with cost-burdened households needing to spend nearly half of their income to afford a median home, according to a monthly report by a real estate website.
RealtyHop put the Northern Nevada city 18th behind Denver and San Jose, California, in its September ranking of housing markets based on median price and area incomes.
“Homebuyers in major West Coast cities have been eyeing surrounding markets that are more affordable,” Shane Lee, a RealtyHop data scientist, told the Reno Gazette-Journal.
“Reno, specifically, has been absorbing the outflow from California over the past couple of years,” Lee said. “And now, as companies continue with their remote working policies due to COVID-19, there’s less of a reason to stay close to major
hubs, making Reno an even more desirable location for professionals looking to own a home.”
Los Angeles, Miami, New York and San Francisco lead the RealtyHop September ranking of the 100 largest cities in the nation with least-affordable housing. Las Vegas ranked 48th.
The index uses U.S. Census and RealtyHop data measuring me
dian household income, median for-sale home listing prices, local property taxes and mortgage expenses based on a 30-year mortgage with a 4.5 percent interest rate and 20 percent down payment. It factors in Nevada’s lack of state tax.
The median home price in Reno jumped from $425,000 at the beginning of the year to $439,900, according to RealtyHop, and the study concluded that homeowners with a median household income of $52,100 now need to spend 47 percent of their earnings to afford it.
In Las Vegas, the median home price was $325,000, meaning a homeowner with a $53,129 income spends 34.3 percent on housing.
Both exceed the 30 percent threshold used by the federal government to identify households cost-burdened by the amount spent on housing.
The average rent also reached a record $1,369 per month in Reno-Sparks during the second quarter of 2020.
Questions remain in the apartment sector, where vacancies were low at just 3.3 percent in the second quarter of 2020.
Industry watchers expect vacancies to increase as people exhaust unemployment benefits and the state’s eviction moratorium expires Oct. 14.
The COVID-19 pandemic knocked Washoe County from an unemployment rate of 2.6 percent at the end of 2019, just above the all-time low of 2.5 percent set in 1999.