Home sales in Las Vegas increased in April while median prices fell by single-digit percentages and appear to have stabilized at the lower end of the market, Home Builders Research reported Monday.
Existing-home sales rose to 3,724 during the month, up 2 percent from a year ago. For the first four months of the year, resales increased 15.3 percent to 13,846 closings.
Prices have not changed much in the past year, Home Builders Research President Dennis Smith said. The median resale price fell to $128,000 in April, down $2,000, or 1.6 percent, from a year ago.
New-home sales showed a healthy jump to 471 closings in April, compared with 343 a year ago, including 61 high-rise closings at CityCenter. For the year, new-home sales are up 1 percent at 1,510.
The median new-home price fell 5.9 percent to $203,085, down $12,565 from a year ago.
"I can almost guarantee that new-home prices will go up because right now materials have gone up and the cost to build has gone up," Smith said. "Plus the price of a finished lot has increased to $40,000 to $45,000, whereas six months ago that number was $30,000 to $35,000. That’s just because there’s fewer of them."
Smith said he expects a "doozy of a month" in June. That’s when homes purchased by the April 30 deadline for the federal homebuyer tax credit must close escrow.
"We hope the lenders and processors are ready for the rush to close," he said. "You just know there will be last-minute issues that will keep many awake at night."
Las Vegas-based SalesTraq housing research firm showed 480 new-home sales in April, a 44.1 percent increase from a year ago. The median price fell 5.4 percent to $204,313.
Existing-home closings rose 3.6 percent to 4,323, and the median price crept up 0.9 percent to $126,000, the highest level in more than a year.
The increases may amount to small numbers, but the upward trend continues, real estate consultant Steve Bottfeld of Marketing Solutions said.
"Nearly every pundit has told the world that the Las Vegas real estate market is dead, or if not dead, is on life support," Bottfeld said. "April figures suggest that Las Vegas may not be out of the sick bay, but will probably recover more quickly than people think."
One reversal of a positive trend is the 2,146 repossessed homes, or foreclosures, in April, a 91 percent increase from a year ago. That followed decreases of 57 percent, 58 percent and 25 percent for the first three months of the year.
SalesTraq reported 969 short sales, or sales for less than the principal mortgage balance, at a median price of $122,000; 335 auction sales at a median of $93,000; 1,636 bank-owned, sales at $125,000; and 1,383 regular transactions at $135,000.
Smith didn’t find much to get excited about in April’s market report except for new-home building permits. He counted 481 permits in April, bringing the year-to-date total to 2,065, up 130 percent from a year ago.
"Subcontractors have been waiting for that," he said. "The important thing to me is there’s work out there for subcontractors. Building these new homes translates to people working, not only in the actual construction of the homes, but also the suppliers of all the materials, the loan processing, the title company work.
"I’m not concerned about excess inventory out there for new homes. It’ll go up over this period of transition for closings (from the tax credit). There will be some cancellations, some loan rejections, so there’s always going to be some standing inventory, but the builders will put out discounts and those houses will be gone in a month or two."
The National Association of Home Builders-Wells Fargo Housing Market Index for May showed builder confidence for new single-family homes at its highest level in more than two years.
Lenders are filing about 100,000 notices of default each day nationwide, but not all of those homes will come to the market as foreclosures, said Rick Sharga, senior vice president of Irvine, Calif.-based RealtyTrac foreclosure listing service. Banks will react to market conditions, he said.
"If buying slows down, it’s less likely that banks will release these homes," he said. "We might actually see banks slow things down more than they already have if sales dip after the government incentives expire."
The government’s Home Affordable Foreclosure Alternative program implemented April 5 was supposed to streamline the short-sale process and provide financial incentives for borrowers and lenders to work together to avoid foreclosure.
That hasn’t happened yet, Smith said.
"Most of the Realtors I’ve talked to said nothing’s changed," he said. "Short sales are still dragging. I’m still being told they won’t touch them. We’ve got to give the programs more time to see how they play out."
David Brownell of Keller Williams Realty in Las Vegas reported 1,563 real estate-owned closings, or 43.6 percent of 3,585 total home sales in April. Short sales accounted for 968 closings, or 27 percent of the total.
REOs make up 16.6 percent of the inventory, or 1,531 units, while short sale listings are 44.5 percent of the inventory, or 4,096 units.
Contact reporter Hubble Smith at firstname.lastname@example.org or 702-383-0491.