Las Vegas Valley New home sales nearing 2006 levels.
Through the first four months of the year, new home closings have reached 3,264; a 22% increase over the same period last year. If new home closings continue at this rate, we will have seen nearly 10,000 new homes closed in 2018; less than 2006 but nearing those levels. Building permits pulled in April were 1,047, a 28% increase from April of 2017. This brings the total number of building permits through April of 2018 to 4,059, 33% higher than last year. If this pace continues we will have over 12,000 permits pulled in 2018. This increase in permits pulled will pave the way for strong new home sales in 2018 and 2019.
With the increase in new construction sales, construction worker talent is in high demand. There is currently a shortage of construction workers which has slowed down the build time from four months to build a new home to six months.
The current median new home closing price in April was $374,440. This is an increase of 11 percent over prior year. Many factors are causing this increase including; labor shortage, material costs, land costs, high demand for new construction and supply shortage.
In California, all new homes will be required to install solar panels for whole house solar systems in an effort to save energy beginning January 1, 2020. It will be interesting to see if Nevada follows in the same path.
If you describe Real Estate as Luxury enough times, it starts to lose its meaning. Luxury is entirely overused in the Real Estate market to describe properties that do not meet the general definition of a Luxury Real Estate Property. In fact, the term Luxury has been used to describe Ultra Luxury Real Estate; homes of the world’s wealthiest 1% to a small kitchen re-model.
The Institute for Luxury Home Marketing, which specializes in training real estate professionals in high-end home sales, defines luxury as the top 10% of the Real Estate Market in any metropolitan market. You may be surprised to know that 90% of the resale homes that sell in our market are under $630,000.
In addition, there is no official checklist for labeling a property as luxury. Noteworthy, there are some general features that are common in upscale properties:
- Gated communities or buildings with a high level of security
- Prime Location
- Professional Quality Kitchen Appliances
- High End Interior Finishes
- Customized Closets
- Hotel like facilities if the property is located in a luxury building
In the Las Vegas Market in the preceding six months:
The top 10% of the market that sold was $630,000 or above that price point. There were 593 homes that sold with an average days on market of 89 days.
The top 5% of the market that sold was $925,000 or above. 222 homes sold and were on the market an average of 105 days.
The top 1% of the market that sold was $3,000,000 and over. 25 properties sold with an average days on market of 164 days.
Finally, if you are questioning whether your home would be considered in the top 10% of the market, talk with your Windermere Prestige Properties Agent. To preview our Luxury listings go to: www.finevegashomes.com
The 2017 Las Vegas Real Estate Market Summery. 2017 turned out to be a positive year in the Real Estate market for our clients.
36% Average Sales price has increased in the past five years. Our 2017 Las Vegas Real Estate Market Summary determined in December of 2013, the Average sales price for a Residential Single Family home was $231,725; while in December, 2017 the average sales price was $316,359. That is an increase over five years of $84,634 or 36%.
The total number of resale closings totaled 43,023 in 2017, an increase of 7.5% over 2016 and an increase since 2014 of 24%. New construction closings are predicted to be over 9,000 for 2017 a year to year increase of 15%. The average price of new construction is now over $350,000, an increase of 8% over prior year.
What does the future hold for our Real Estate Market and what does this mean for our clients buying and selling?
*. There are no immediate signs that would signal prices will start dropping, in fact we believe pricing will continue to climb.
*. Consumer demand is still strong.
*. There is no sign of over-building in new construction.
*. California residents average price for a home is $500,000. This along with the Congressional proposed legislation to cap state and local taxes which could impact resident’s ability to itemize some deductions could be the catalyst to prompt our neighbors to move North to Nevada.
*. 43,000 homes or 10% of all mortgages are still underwater in Clark County. A year ago 19% of the homes In Clark County were underwater. Though the market is not completely healed, this is a step In the right direction.
*. There is a less than two month supply of housing.
*. Interest Rates continue to be stable.
2018 should continue to move in the right direction for housing, with the number of closings both resale and new construction continuing to rise. The economic forecasts continue to predict a population growth in Clark County of a minimum 2% a year.
For those considering purchasing In 2018, if your price point is under $400,000, properties in good condition, priced at or slightly above market are getting multiple offers and often sell over list. Take this into consideration when your write your offer.
Those considering selling; 1). Make sure your home is in the best possible condition to that you get the best price, 2). Price your home at market or slightly above, and 3). Make sure your home is easy to show. Always, utilize the skills of a professional Realtor with a proven track record.
If you live out of state you may not be aware of the Real Estate market in the Southern Nevada; the activity in the market is incredibly strong and there may be a possibility of creating a Tax Free Exchange.
- Southern Nevada residential Real Estate has increased 9% since the first of the year.
- Depending on how long you have owned your property here, your property may have increased in value up to 86%.
Average Single Family Sales Price
May, 2012 $161,003
May, 2013 $214,490
May, 2014 $236,850
May, 2015 $245,985
May, 2016 $275,209
May, 2017 $299,046
If you purchased your property in May, of 2012 your property could have potentially increased in value 86%. If you purchased in 2015, values went up 21%.
Properties are selling over list and buyers are bringing in cash above appraised values. Do get an accurate picture of your property valuation, contact me by phone or email and I will forward you the details. Investors are still buying because the market is strong and they are seeing a continued increase in pricing.
If your Real Estate investments have increased in value, you may be in a position to sell and do a tax free exchange and purchase multiple properties with the cash from a sale. This is a great way to leverage your current investment.
If you would like to discuss your situation in detail please reach out to me. For more information on the market you can go to my blog or Facebook page.
For a few hundred dollars more a month you may be able to enjoy a larger home because of homeowner equity and interest rates.
Homeowner equity at 85% in Southern Nevada.
Great News for Southern Nevada; nearly 85% of homeowners in have equity in their homes. This is an increase over 2015; in which only 79% of homeowner’s had positive equity. If you have positive equity and you want to move up to a larger home or a home in a different area; you may be paying only slightly more for a larger, more expensive home. If you purchased your home in the early to mid 2000’s you probably got a mortgage in the 6% or more range. Current mortgage rates are up to 2% less.
For as little as $232 a month a homeowner can enjoy $100,000 upgrade in their home.
Example: Your home was purchased in 2003 for $250,000 with a mortgage of $200,000. Your current interest rate is 6.25% with a current payment of: $1,231.43 (principle and interest). If you were to sell that home and move up to a $350,000 home; your mortgage could be 4.25% on $297,500; or $1,463.52 (Principle and Interest). For $232.09 in additional payment (principle and interest only); you can move up to a home that is potentially larger, perhaps a larger homesite or perhaps a new home.
There is an opportunity for homebuyers to participate in greater appreciation buyer selling now and buying.
Another benefit; with the prices increases in this Real Estate market; you will have the opportunity to participation in greater appreciation. You might be surprised what you can get for your home now. It is a seller’s market. We recommend you explore this opportunity to own the home of your dreams for a small additional monthly payment.
Even in light of the increased number of new construction sales in our market; resales closings have increased by 9% in 2016:
Resale Closings Year
The increase in the number of closings between 2014 and 2016 was 5,503; a 16% increase. This is a sign of a healthier economy and therefore a healthier Real Estate market. More residents of Southern Nevada were able to buy a home in 2016 than in 2014 or 2015.
At the end of 2015, the average sales price was $254,159. December, 2016 the average sales price was $274,710 and increase of 8%. Still prices are very affordable but inching their way up with a healthy level of appreciation.
The Crystal Ball for 2017 is a continued increase in pricing, and perhaps an increase in interest rates as well. Our recommendation is to purchase as soon as you can as you will see additional increases in pricing this year. If you would like to sell but you are still under water, the next year could bring good news for you.
The number of resale homes on the market is at an unseasonably low level – 7,455. This 17% drop from December of 2015 and 8% from November of 2016 could be a trend.
The last time we saw resale inventory below 8,000 was September of 2013. Many of you may recall, that 2013 was a big year for appreciation in the valley.
The December. 2013 closings were at 3,433. Closings are up 8% compared to December of 2015 and 8% when compared to November of 2016. Overall the number of closings or demand is stable.
The Average Resale sales price is $274,710 in December of 2016. This is an 8% increase over December of 2015 ($254,159).
With a decrease in resale listings there will be more competition for properties and we could see an increase in pricing. We may see multiple offers on properties as well.
2015 LAS VEGAS MARKET – YEAR IN REVIEW
* There was an increase from 34,525 resale closings in 2014 to 36,422 closings in 2015; an increase of 5%.
* One of the most significant changes from 2014 to 2015 is the number of short sale closings. A total of 2,667 short sale closings transacted in 2015 compared to the prior year which was 4,121. This is a decrease of 35% which is a very positive change and an indicating of a healthier Real Estate market.
* At the end of 2015 the average sales price was $254,159. Compared to the end of year average sales price for 2014, at $249,934. This is a slight increase of about 2% in values year to year.
* An increase in traditional sales from _____ percent in December 2014 to ______ in December of 2015. This increase in traditional (non distressed) properties and decreased in distressed (short sales and foreclosures) is another positive change indicating a move towards a stronger, healthier Real Estate Market.
* Closings of Real Estate is up 32% month to month.
* The number of new listings on the market compared to prior month is down 19%. This is a reflection of the time of year. Fewer homeowners list their properties in December.
* The number of new listings over $500,000 is down 16% compared to prior month. Again a reflection of the time of year.
* The number of short sales closings increased 31% when compared to prior month. Short sales are closings in which the bank who holds the note has agreed to take less than is owed on the property.