Analyst says $100,000 home making comeback in Las Vegas

Once considered nearly extinct in Las Vegas, the $100,000 home has made a strong comeback in recent years, housing analyst Larry Murphy said Thursday.

The median price of an existing home has fallen from its peak of $285,000 in 2006 to $108,000 in March, Las Vegas-based SalesTraq reported.

Murphy, president of SalesTraq, put the chances at 50-50 that the median price could scrape $100,000 in the second half of this year. Almost one-third of last year’s existing-home sales were under $100,000, he said.

"One thing I’ve learned in this business is anything is possible," Murphy said at his quarterly Crystal Ball presentation. "Every time we think we’ve hit the bottom, we go down a little more."

New-home median prices are down to $195,950 from their peak of $328,850 in 2006. Sales volume plummeted from 38,705 in 2005 to 5,438 last year and probably won’t reach 4,000 this year.

Murphy said he’s getting tired of delivering bad news at Crystal Ball and admitted that sometimes he doesn’t recognize good news when he sees it. Then again, it’s a matter of perspective.

"Good news or bad news depends on if you’re a buyer or seller," he said. "People make money on real estate in an up market and people make money on real estate in a down market."

Take, for example, a 479-square-foot condo at Luna di Lusso in Lake Las Vegas. It last sold for $399,000 in 2006 and is now listed for sale at $39,900, or 10 cents on the dollar.

In the new-home segment, KB Home has lowered prices on homes in the Inspirada community and William Lyon Homes is giving a $20,000 allowance to be used any way the buyer wants.

Richmond American is offering 4.25 percent financing on 30-year, fixed-rate mortgages.

"The last time you saw that was World War II," Murphy said. "We may never see anything like it again in my lifetime."

Frank Wyatt, founder of Las Vegas-based Pinnacle Homes, said demand for new homes is stable, albeit at depressed levels. Site development is limited because it’s still hard to make financial sense out of finished lot prices. Financing for new-home construction is also difficult, he said.

"At the time when values dropped, we didn’t do much. We’re not looking for dirt," Wyatt said. "The first thing we did was resolve old construction loans. We had not been active in buying lots until nine months ago. Since then we bought 14 lots, one or two at a time. The price of lots is critical. You can’t stub your toe. You look for skeletons in the closet, entitlement issues and restrictions."

Even after finding a willing buyer and signing a sales contract, the builder has to "pray for the appraisal," Wyatt said. "If that appraisal doesn’t come in, you’re screwed."

Murphy said the number of new-home subdivisions in Las Vegas has remained stable at 239, with three or four subdivisions opening and closing each month. Builders pulled 808 new-home permits in the first quarter, down 46 percent from a year ago.

"If that’s a measure of optimism, it looks to me like builders are not as optimistic as they were one year ago," Murphy said. New-home sales were boosted in 2010 by the government’s homebuyer tax credit that expired in June, he said.

Home prices continued to decline in Las Vegas even as demand increased, starting in June 2008. Existing-home sales surged to 5,114 in March, the highest level since October 2009, according to SalesTraq.

"In your heart, you’ve got to believe Las Vegas is undervalued," Murphy said. "Even without a calculator or a college education, when you see a condo at Luna di Lusso for 10 cents on the dollar … smart money is buying a home in Las Vegas today. You’ll look like a genius in five years."

About three-fourths of Las Vegas home sales are real estate-owned, or bank-owned, and short sales, or homes sold for less than the principal mortgage balance. That’s affecting prices of nondistressed home sales, Murphy said.

Homes are selling for an average of $65 a square foot at trustee auction; $71 for REOs; $80 for short sales; $88 for nondistressed; and $103 for new homes, according to SalesTraq.

Contact reporter Hubble Smith at or 702-383-0491.

UNLV Tech Park innovation building breaks ground
Construction on the first innovation building at the UNLV Tech Park is underway. (Bailey Schulz/Las Vegas Review-Journal)
Caesars Forum Meeting Center
Caesars broke ground Monday on its $375 million Caesars Forum Meeting Center (convention center) just east of the High Roller observation wheel. (Caesars Entertainment)
Technology reshapes the pawn shop industry
Devin Battersby attaches a black-colored device to the back of her iPhone and snaps several of the inside and outside of a Louis Vuitton wallet. The device, installed with artificial intelligence capabilities, analyzes the images using a patented microscopic technology. Within a few minutes, Battersby receives an answer on her app. The designer item is authentic.
Recreational marijuana has been legal in Nevada for one year
Exhale Nevada CEO Pete Findley talks about the one year anniversary of the legalization of recreational marijuana in Nevada. (K.M. Cannon/Las Vegas Review-Journal)
Young adults aren't saving for retirement
Financial advisors talk about saving trends among young adults. (Bailey Schulz/Las Vegas Review-Journal)
President Trump’s tariffs could raise costs for real estate developers, analysts say
President Donald Trump made his fortune in real estate, but by slapping tariffs on imports from close allies, developers in Las Vegas and other cities could get hit hard.
Las Vegas business and tariffs
Barry Yost, co-owner of Precision Tube Laser, LLC, places a metal pipe into the TruLaser Tube 5000 laser cutting machine on Wednesday, June 20, 2018, in Las Vegas. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Nevada Film Office Connects Businesses To Producers
The director of the Nevada Film Office discusses its revamped locations database and how it will affect local businesses. (Bailey Schulz/Las Vegas Review-Journal)
Opendoor isn't the typical house flipping company
Unlike most house flippers, the company aims to make money from transaction costs rather than from selling homes for more than their purchase price.
The Venetian gondoliers sing Italian songs
Gondolier Marciano sings a the classic Italian song "Volare" as he leads guests through the canals of The Venetian in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal)
Building In Logandale
Texas homebuilder D.R. Horton bought 43 lots in rural Logandale. (Eli Segall/Las Vegas Review-Journal)
Indoor farming in Southern Nevada
Experts discuss Nevada's indoor farming industry. (Bailey Schulz/Las Vegas Review-Journal)
Former Fontainebleau could have become a Waldorf Astoria
Months after developer Steve Witkoff bought the Fontainebleau last summer, he unveiled plans to turn the mothballed hotel into a Marriott-managed resort called The Drew. But if Richard “Boz” Bosworth’s plans didn’t fall through, the north Las Vegas Strip tower could have become a Waldorf Astoria with several floors of timeshare units. (Eli Segall/Las Vegas Review-Journal)
LVCVA CEO Rossi Ralenkotter announces plans to retire
Rossi Ralenkotter, CEO of the LVCVA, on Tuesday confirmed a Las Vegas Review-Journal report that he is preparing to retire. Richard N. Velotta/ Las Vegas Review-Journal
Cousins Maine Lobster to open inside 2 Las Vegas Smith’s stores
Cousins Maine Lobster food truck company will open inside Las Vegas’ two newest Smith’s at Skye Canyon Park Drive and U.S. Highway 95, and at Warm Springs Road and Durango Drive. Cousins currently sells outside some Las Vegas Smith’s stores and at Fremont Street and Las Vegas Boulevard. (K.M. Cannon/Las Vegas Review-Journal)
Las Vegas home prices to continue to rise, expert says
Lawrence Yun, chief economist at the National Association of Realtors, gives homebuyers a pulse on the Las Vegas housing market. (Eli Segall/Las Vegas Review-Journal)
NV Energy announces clean energy investment
The company is planning to add six solar projects in Nevada, along with the state's first major battery energy storage capacity. Bailey Schulz/Las Vegas Review-Journal
3 Mario Batali restaurants on Las Vegas Strip to close
Days after new sexual misconduct allegations were made against celebrity chef Mario Batali, his company announced Friday that it will close its three Las Vegas restaurants July 27. Employees of Carnevino Italian Steakhouse, B&B Ristorante and Otto Enoteca e Pizzeria, all located in The Venetian and Palazzo resorts, were informed of the decision Friday morning. Bastianich is scheduled to visit the restaurants Friday to speak to employees about the next two months of operation as well as how the company plans to help them transition to new positions.
Nevada has its first cybersecurity apprenticeship program
The Learning Center education company in Las Vegas has launched the first apprenticeship program for cybersecurity in Nevada. It was approved by the State Apprenticeship Council on May 15. (K.M. Cannon/Las Vegas Review-Journal)
Las Vegas union members voting to authorize the right to strike
Thousands of Las Vegas union members voting Tuesday morning to authorize the right to strike. A “yes” vote would give the union negotiating committee the power to call a strike anytime after June 1 at the resorts that fail to reach an agreement. (Todd Prince/Las Vegas Review-Journal)
Small businesses struggle to find qualified candidates
A 2018 survey found that over two-thirds of small businesses in Nevada find it somewhat to very difficult to recruit qualified candidates. Bailey Schulz/Las Vegas Review-Journal
Nevada secretary of state website offers little protection against fraudulent business filings
Property developer Andy Pham tells how control of his business was easily seized by another person using the secretary of state website.
Caesars may be going solo in its marijuana policy
Several Southern Nevada casino companies aren’t following Caesars Entertainment’s lead on marijuana testing.
How much is the Lucky Dragon worth?
Less than a year-and-a-half after it opened, the Lucky Dragon was in bankruptcy.
Gyms and discount stores take over empty retail spaces
Grocery stores used to draw people to shopping centers. But many large retail spaces have been vacant since 2008. Discount stores like goodwill and gyms like EOS Fitness are filling those empty spaces, and helping to draw shoppers back in. K.M. Cannon/Las Vegas Review-Journal
Funding source of Las Vegas stadium for the Raiders is sound, expert says
The stadium is funded in part by $750 million of room taxes, the biggest such tax subsidy ever for a professional sports stadium. Robert Lang, executive director of Brookings Mountain West and The Lincy Institute at UNLV, says that is a good use of public funds. (Richard Velotta/Las Vegas Review-Journal)
Las Vegas needs light rail, expert says
Robert Lang, executive director of Brookings Mountain West and the Lincy Institute said he is afraid of a "congestion mobility crisis." Las Vegas needs a light rail system, he said, to accommodate the city's growing number of attractions. (Richard Velotta/Las Vegas Review-Journal)
Three takeaways from Wynn Resorts' Earnings Call
Matt Maddox came out swinging in his first earnings conference call as Wynn Resorts chief executive officer, boasting of record Las Vegas quarterly revenues and applicants lining up for work.
Star Wars VR Comes to Las Vegas
Sneak peak at the new "Star Wars: Secrets of the Empire" VR experience at the Grand Canal Shoppes.
Elaine Wynn continues her fight to change Wynn Resorts board
Elaine Wynn, the largest shareholder of Wynn Resorts Ltd., is seeking to kick a friend of her ex-husband Steve Wynn off the company’s board of directors. (Todd Prince/Las Vegas Review-Journal)
News Headlines
Add Event
Home Front Page Footer Listing
You May Like

You May Like