Disparity, scarcity of homes fill market in Paradise and downtown

A shortage of homes for sale in the downtown and Paradise areas paired with high demand has driven home prices up by an average of 10.65 percent, according to a March report released by the Greater Las Vegas Association of Realtors.

However, long time downtown real estate agent Jack LeVine said the number is deceptive because ZIP codes commonly associated with the downtown area and Paradise encompass “some of the worst places in town and some of the nicest historic neighborhoods,” adding that with such a large area, wide disparities in prices are natural.

Of the 484 properties for sale in the area, livable single-family residences cost about $35,000 on the low end. The lowest-priced homes are usually north of U.S. Highway 95.

Custom-home neighborhoods, such as ones in the 89107 ZIP code, can see home prices in the millions, such as a palatial $5.2 million, 8,000 -square-foot home in the Historic Alta Area. “It’s a whole different world south of 95,” LeVine said.

Home buyers can also become discouraged in the tough market, where cash is king.

“It’s extremely difficult to purchase property at the moment, regardless of whether you’re an investor with cash or a first-time home buyer,” said Matt Jenkins, general manager of Third Man Capital, a real estate investment company based downtown that owns a number of rental properties in the area. “It can be very frustrating for home buyers to continuously offer 10 percent over list price and be continuously rejected.”

However, it is a fight worth waging, LeVine said.

“It may not be their first choice, but home buyers are getting houses,” LeVine said. “It is worth the battle to be a
home owner.”

Jenkins agreed but said that there is a disparity in current home values and what buyers are willing to pay.

“People are obviously limited by the finances available,” he said. “Buyers are willing to pay $200,000, but the banks are not willing to lend that much for a property appraised at $150,000.”

And the outlook isn’t much better for buyers anytime soon, he said.

“Government intervention has turned the foreclosure faucet off,” he said, referring to Nevada Assembly Bill 284, which was signed into law and imposes stricter requirements on filing notices of default, meaning less inventory.

“The rapid inflation of home prices is due to that bill,” Jenkins said. “What we really need is a steadier, more stable rise.”

Despite the difficulty for home buyers, Jenkins and LeVine agreed that now is still a good time to buy.

“Prices are up nearly 30 percent from a year ago, but we still have 20 percent to go to match the peak,” LeVine said.

Contact Paradise/Downtown View reporter Nolan Lister at nlister@viewnews.com or 702-383-0492.