Homebuyer activity is picking up at Southern Nevada construction sites, a rebound for an industry whose sales pipeline shrank rapidly when the coronavirus pandemic hit, a new report states.
Local builders fetched 289 net sales — newly signed sales contracts minus cancellations — for the week ending June 21, up from just 38 in the week ending April 5, Las Vegas-based Home Builders Research reported.
Buyer traffic to new subdivisions has increased each week since the beginning of May as well.
Despite the uptick, the “process of actually getting those homes built is still being quite dramatically affected by the COVID-19 crisis,” Home Builders Research President Andrew Smith wrote in the report, referring to the respiratory disease caused by the new coronavirus.
Amid layoffs, furloughs, social distancing and shutdowns, builders “will continue to struggle” to return to a pace similar to that of the first quarter, when they pulled more than 1,000 home construction permits per month, Smith added.
Builders pulled 417 new-home permits in Southern Nevada in May, down 50 percent from the same month last year, he reported.
They also closed 729 new-home sales in Southern Nevada last month, down 20 percent from May 2019. It’s not uncommon for builders to close a deal several months after the buyer signs the sales contract.
Job losses skyrocketed in Southern Nevada after Gov. Steve Sisolak ordered casinos and other businesses closed in March to help contain the virus’ spread. Amid the chaos, Las Vegas’ housing market was hit with an extreme burst of turbulence: the tally of newly signed purchase agreements tumbled fast, and sales cancellations surged.
Both the new-home and resale sectors are showing signs that the pandemic-sparked housing turmoil is easing, but there are still plenty of unknowns.
Casinos and other businesses have been reopening, but it’s anyone’s guess how long it will take for tourism, Las Vegas’ financial lifeblood, to fully recover from the shutdowns.
It’s also too early to say whether a resurging tally of confirmed coronavirus infections will again inflict deep pain on Southern Nevada’s badly battered economy.
“We can clearly see the positive momentum that has returned to the Southern Nevada housing market,” Smith wrote, but given “the very real possibility of a ‘second wave’ of virus outbreaks things have to be kept in perspective.”