The Vegas Valley Housing Market Still Has High Demand With a Low Inventory
Southern Nevada had mixed results for homebuilders last month, but the overall trend is up. In 2021, buyers have purchased more houses at higher price points compared to the previous year.
Developers contracted 977 net sales — recently signed deals after you take out the cancellations — in September. That’s up 12% from the previous month but down 5% year over year, according to a report from the Las Vegas-based Home Builders Research.
The report says potential buyers canceled almost 150 new-home deals last month, the highest number since October 2020. But interest in developers' offerings was up in September compared to the two months leading up to it.
All told, homebuilders finalized 9,011 sales in Southern Nevada in the first nine months of 2021, up 17% from the same period in 2020. There were also 11,275 new-home permits granted, a 33% increase, which proves development plans are ramping up.
In addition, new home purchasers had a median closing cost of $421,790 last month, up almost 14% percent from the year before.
For single-family houses — developers' top-selling item by a wide margin in Southern Nevada — buyers paid a record-high average of $450,114 last month, up more than 15% year over year.
After a purchaser signs a contract, it can take months to complete construction of the house so the sale can close.
The Las Vegas real estate market has sped up over the previous year with quick deals and record prices, mainly driven by super-low mortgage rates that give buyers more bang for their buck. More out-of-state customers than expected have also come to Southern Nevada during the pandemic, according to real estate professionals, because new work-from-home opportunities prompted people to seek larger homes at lower prices.
Local builders have made buyer waiting lists, allowed bidding wars on lots, and continued to raise home prices in the face of high demand, low supply, and more expensive equipment.
Home Builders Research President Andrew Smith, referring to rising new-home prices, wrote in Monday's report that the market is currently "starting to see the real impact" of high demand for a low supply of inventory.
Smith says base asking prices "continue to rise," with more than half of all new-home sales this year having base prices ranging from $400,000 to $750,000.
On the other hand, only 3% of sales this year were in communities with prices under $300,000.
Las Vegas and Henderson Home Prices Have Increased Several Times
People come and go. Tourists. People relocating from California. We have survived many ups and downs, but life goes on.
Southern Nevada home costs have been on a wild stomach-churning ride over the past few years: The market floors it, hits the brakes and speeds up again.
It has sped up once more over the previous year with fast deals and record costs, because of low mortgage costs that have allowed purchasers to rethink their financial plans. Las Vegas isn't the only one — home costs have shot higher throughout the nation as well.
Yet, Southern Nevada home estimations soared higher in the past and at a faster pace than elsewhere. After the economy crashed 10 years ago, home costs here also sank quicker than the U.S. average.
The Las Vegas market flooded again in 2013 as deal-hunting financial backers purchased modest homes in bulk to transform into rentals. Given the seriousness of the recession here, there was no deficiency of supply, so costs increased again.
By summer 2013, Las Vegas home costs had risen almost 30% from a year earlier, while the rest of the country only saw a 10% increase, according to Case-Shiller.
Housing is a circular industry, affected by good times and bad. But the Las Vegas real estate market has been more unpredictable than most. It has a transient population, consistently attracts out-of-state financial backers, and there is still a lot of land left for development.
Las Vegas Golf Course, Once Owned by Billy Walters, May See New Homes
Touchstone Living has made plans to build around 1,300 homes on 130 acres of land in the Royal Links Golf Club, according to county documents. The proposed development, along Vegas Valley Drive about a mile east of Nellis Boulevard, would include two-story townhomes, pools, playgrounds, walking trails, and courts for tennis and pickleball.
The Clark County Planning Commission will review the proposal on Tuesday.
Touchstone would build its large residential lot over the Royal Links Golf Club, an east valley golf course with a long and controversial history, including ownership by notorious gambler Billy Walters, a police investigation, allegations of city council favoritism, and a multimillion-dollar bid during the mid-2000s housing bubble.
This project would bring lower-priced houses to a market increasingly overwhelmed by more expensive homes.
Homes for Sale Near the Royal Links Golf Club