A luxury home priced above $1 million in the Reno-Tahoe region can sell quickly or sit for months, and the difference has little to do with location or square footage. According to Laura Kirsch, who leads the Kirsch Real Estate Team at Marmot Properties in Reno, the dividing line is condition: homes that have been cosmetically updated are moving in a tight inventory environment, while luxury homes that remain original to their build era linger on the market and eventually sell at a discount.
The split traces directly to construction costs. Since the pandemic, renovation expenses climbed sharply and have stayed elevated. That has made buyers across price ranges reluctant to take on projects, widening the gap in the luxury tier between homes that are move-in ready and those that are not.
“Since COVID, the cost of construction went extremely high, and it’s still at an all-time high with no foreseeable future of it coming down,” Kirsch says. “Buyers are hesitant to purchase homes that are in need of cosmetic updates.”
The strongest performance in the Reno market is concentrated in a handful of zip codes – 89511, 89519, and 89509 – which Kirsch describes as neighborhoods people have always wanted to be in, anchored by highly rated school zones.
At the other end, the $600,000 to $900,000 range is where buyer activity drops off most noticeably. These are often move-up buyers trying to go from a $500,000 home to something larger, and the current interest rate environment – which Kirsch describes as a three-year high – makes that jump harder to execute. “Whoever is affording that home, they’re greatly affected by these mortgage interest rates,” she says.
The move-up buyer is central to the Reno-Tahoe market right now. Most of Kirsch’s buyer clients are locals with a growing family looking for more space, not out-of-state relocators. That means the market’s momentum depends heavily on whether existing homeowners can afford to trade up – a calculation that interest rates directly affect.
With rates compressing affordability, sellers in the Reno-Tahoe area are offering concessions that would have been unusual a few years ago. Standard price reductions are common, but the more notable change is in deal structure.
Kirsch says sellers are now open to approaches like seller financing or longer-term lease options that give buyers time to secure a lower interest rate. “Sellers are more open to being creative than I’ve seen them in a very long time,” she says.
That willingness reflects a practical calculation: in a market where updated homes move and outdated ones stall, sellers who cannot or will not renovate need another way to attract buyers. Flexible financing terms have become that tool.
New construction, particularly spec homes, is performing well precisely because it satisfies the demand for updated, move-in-ready homes without the buyer taking on renovation risk. Kirsch’s team recently sold a spec home in Montrêux, a golf course community in Reno, at the fifth-highest price per square foot ever recorded in that community.
Every new home in Nevada is required to come with a one-year warranty, which reduces inspection friction. And because builders do extensive pricing research during the development process, appraisal risk is lower than on resale properties. The result is a transaction with fewer deal killers than a typical resale.
For investors, Kirsch sees the condition gap as a specific opportunity: purchasing unrenovated luxury homes at a discount, investing in updates, and reselling into the demand for finished homes. “Getting one of those non-updated luxury homes, putting some money into it and then reselling it is probably the best flip market I’m seeing,” she says.
Nevada’s lack of a state income tax continues to draw relocators and retirees, but the flow from California is not the recent surge that national coverage sometimes implies. “I wouldn’t see a bigger influx than over the past eight years,” Kirsch says. “There’s just always been a lot of them.”
What does surprise California buyers is the property tax structure. In Washoe County, property taxes are calculated using an algorithm based primarily on the age of the home, not its sale price. Kirsch says the effective rate runs roughly 0.5 to 0.75 percent of sale value, compared to the 1 to 1.5 percent California buyers are accustomed to paying.
A newer source of inbound interest is Washington state, where a potential income tax on earners above $1 million has prompted inquiries. Kirsch says this could add further demand pressure to an already competitive market.
Kirsch describes the Reno-Tahoe market heading into the end of the year as getting “really hot.” The move-up segment between $600,000 and $900,000 remains the most rate-sensitive part of the market, with buyers in that range still struggling to bridge the gap between their current home and the next one. Above $1 million, the condition split continues to dictate outcomes: updated homes attract strong offers, while unrenovated homes require either price cuts or creative deal structures to close. “If a seller is open to doing something beforehand, it’s definitely helping them with their resale value,” Kirsch says.
About the Expert: Laura Kirsch leads the Kirsch Real Estate Team at Marmot Properties in Reno, Nevada, covering the Reno-Tahoe region.
This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.
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