Nevada real estate agents are finding a blossoming real estate oasis in Reno, once a fading gambling mecca that is now gaining attention as the next Silicon Valley. Opportunity is knocking for agents in this region, no longer saddled as a home foreclosure capital.
The key growth drivers in the market, according to Bloomberg, include some new businesses that have located into the area, including a new, highly automated factory run by Ardagh Group SA produces more than 3 million cans of tomato paste and other food products each day.
The big fish landed by local officials, according to says Mike Kazmierski, president of the Economic Development Authority of Western Nevada, was Tesla Inc., which selected Tahoe Reno Industrial Center to build what will be the largest factory in the world and promised to create 6,500 permanent jobs in exchange for $1.3 billion in tax incentives.
“What Tesla did was it took our success and made it huge by reinforcing the message.”
Following in the niche automaker’s footsteps are more companies. The result is that Reno’s unemployment rate has dropped below 4 percent for the first time since 2006.
Known as the “biggest little city,” the median housing price in Reno topped the $350,000 mark for the first time since the recession as low housing supply continues to send home values upward. The increase is up 5 percent from the previous month and 8 percent from the same period last year, according to the Reno/Sparks Association of Realtors.
The city has proven to be a magnet for entrepreneurs. Jake Warner, CEO of cloud-computing startup Cycle, said he considered moving his company and its handful of employees from Toledo, Ohio, to Austin, Seattle — or Reno. His company doesn’t make a product, but he was interested in what others were seeing in the city and bet that others would follow.
“Elon Musk is just my idol. I bought Tesla on IPO day.”
According to RSAR President John Graham, existing home sales also hit a near-record in May at 652 units. The sizzling sales also dropped housing supply in Reno-Sparks to just 1.4 months, which is great for sellers but bad news for buyers in the midst of a housing crunch. Graham added that the rising home prices are fueling concerns among a community that still remembers the last housing collapse.
“With real estate’s appreciating prices, many are saying it’s another real estate bubble. But from what we’ve observed our current situation is different from what we saw 10 years ago.”