July 3, 2020 - 2:45 pm
Though we are currently in a pandemic and have seen fluctuations in the stock market during this time, the Las Vegas real estate market continues to be in high demand.
Overall sales continue to be strong. Though inventory is low, the demand is high and home values are still on the rise. We did see some listings withdraw from the market during the beginning of the governor’s stay-at-home order, however, we continued to see more properties arrive on the market along with a rise in active buyers.
Additionally, Gov. Steve Sisolak’s mandate does not allow open houses and restricts how homes can be shown to potential buyers. That has caused many real estate agents to become more creative in marketing properties. Many agents are opting for virtual property tours and setting appointments for interested buyers to tour vacant and owner-occupied properties though staying within the Centers for Disease Control and Prevention guidelines for social distancing and sanitization.
During this time, many homeowners have been exploring refinancing or forbearance. Elizabeth Sumi is the vice president and regional manager for SWBC Mortgage.
“During these times, we are seeing a refinance boom. Rates haven’t been this low since 2010/2011, and many sellers are refinancing their property to take advantage of the lower rate.
“Forbearance has been very helpful for some homeowners, however, the majority of the people opting for forbearance are unaware of the repercussions. Many banks are requesting all of the mortgage payments during their forbearance period to be paid at once or require the homeowner to show financial hardship and increase their monthly payment until the amount has been caught up. Some homeowners have no choice but to go on forbearance because they have been furloughed from their job and have difficulty making their payments and don’t want to lose their home. These guidelines are changing weekly. And unfortunately, many buyers who had been furloughed were no longer able to qualify for their loans to close on properties that were already under contract due to the mandatory closure of businesses,” she said.
According to Forrest Barbee, broker for Berkshire Hathaway Nevada Properties, at the end of May, residential closings fell 12.1 percent behind last year as a result of the pandemic and changes in Federal Housing Administration underwriting. Meanwhile, single-family residential inventory increased. Currently, there’s only about 1.7 months of marketable inventory because 55 percent of all single-family homes are listed well above what the market will bear.
Unfortunately, these overpriced properties have continued to sit without much activity, showings or offers. Meanwhile, the newer inventory appears to have been priced to the market and is going under contract almost as quickly as the properties come on the market depending upon the community. In May, pending listings showed an increase of 30.5 percent and the average closing sale price of a single-family home increased from $361,326 to $373,974, according to Barbee’s data.
With property values still on the rise it continues to entice many homeowners to list their home, and with the recently lowered interest rates it is equally enticing (if not more so) for buyers to purchase a home. We also are seeing multiple offers on homes, depending on the community if the home has been priced correctly. Being localized within a specific area and even being hyper-localized by narrowing down an area to a specific community or even a specific neighborhood is everything right now.
The Greater Las Vegas area is a very efficient market with very many “micro-climates” of real estate activity. Thus, even if overall market values have dipped 5 percent to 10 percent, that may not be what’s happening in the specific community that we are working in on any given day. Being hyper-localized and hyper-focused on our client’s needs is the essence of a Realtor’s value and why the good ones will always be relevant and in demand.
Tim Dunn is recognized as a top-ranking and award winning Realtor for Berkshire Hathaway. He is a Certified Residential Specialist (CRS), Accredited Buyers Representative (ABR), and Master Certified Negotiation Expert (MCNE) who specializes in residential properties, firstname.lastname@example.org.