Home prices rising slower in Vegas than US overall
Home prices inched up nationwide this summer from a year ago and moved even slower in Las Vegas, according to a new report that highlights buyers’ pullback locally and around the country.
Las Vegas-area home prices in July were up 0.97 percent from a year earlier, compared with a 1.68 percent uptick nationwide during that time, according to the S&P Cotality Case-Shiller index released Tuesday.
This marked one of the weakest annual U.S. price gains in the past decade and reinforced that the housing market “has downshifted to a much slower gear,” said Nicholas Godec, head of fixed income tradables and commodities at S&P Dow Jones Indices.
He also noted in the report that Las Vegas price gains shot past 25 percent at the height of the pandemic buying boom — when rock-bottom mortgage rates fueled a buying frenzy nationwide — but now clock just 1 percent.
Mortgage rates have largely pushed lower in recent months, giving homebuyers in Las Vegas and around the country some relief on borrowing costs. But rates are still elevated compared with what buyers have faced over the past 15 years, and home prices remain high in Southern Nevada, making it difficult for many would-be buyers to afford a place.
Buyers are ‘frozen’
Overall, in Las Vegas, market data points to a shrunken pool of buyers who are able or willing to buy a house nowadays.
Builders closed 861 home sales in Southern Nevada in August, down 26 percent from the same month last year, and fetched a record-high median price of $536,471, up 7.6 percent from a year earlier, Home Builders Research reported.
On the resale side, buyers picked up 1,835 single-family homes in August, down 14 percent from a year earlier, and paid a median price of $480,000, up 0.7 percent, according to trade association Las Vegas Realtors.
The median sales price was just below the all-time high of $485,000, which, the association noted, has been reached several times this year.
Longtime Las Vegas homebuilder Gary Mayo, who was recently named president of Harmony Homes, said the drop in sales boils down to interest rates.
He also figured that if rates keep ticking lower, would-be buyers may stay on the sidelines with the hope that borrowing costs will keep falling.
“People are just frozen,” he said.
‘Wait to find something better’
Across the country, steadily falling mortgage rates “haven’t brought many homebuyers to the market,” listing site Redfin reported last week.
The company cited several reasons why demand hasn’t improved yet, including stubbornly high home prices, mortgage rates haven’t fallen far enough, and economic uncertainty, including fears of layoffs or a possible recession.
Las Vegas shed thousands of jobs in August amid an ongoing tourism slump, according to state officials, who found that Nevada’s labor market is “largely stationary.”
Redfin also reported in August that Las Vegas’ housing market was cooling the fastest in the country among major metro areas, citing Southern Nevada’s drop in sales and sharp rise in available inventory.
“Buyers have more inventory to choose from than they’ve had in years, so they feel like they can take their time,” Cherra Bergman, a Redfin agent in Las Vegas, said in the report. “Even when they find a home they really like, they often wait to find something better.”
Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342.