Positive indicators reflect recovery not boom

A recent report by Home Builders Research Inc. of Las Vegas reveals the current conditions and issues in our local homebuilding industry and housing market.

The company reported that local homebuilders constructed and sold nearly 3,000 homes this year through June, which is an astounding 83 percent increase compared with the sales for the same period last year.

Normally, a double-digit increase would seem like a boom, but in our case, we are still recovering from a slowdown that rivaled the severity of the Great Depression . We are not experiencing a construction and sales boom, but we are on the road to recovery.

We’re finally able to put construction workers and support staff back to work, and we’re getting interested homebuyers into new housing. Additional funding is flowing into the coffers of state and local government agencies that provide vital services in our community.

For example, there are some strong increases in several construction-industry job categories in Clark County for the year through May compared with the same period in 2012, according to the Nevada Employment Security Department. Employment in the building finishing contractors category increased 10.2 percent; the building foundation and exterior contractors’ jobs category is up 8.8 percent; and jobs in the construction of buildings category rose 6.7 percent.

There’s also good news from the Nevada Taxation Department , which recently reported that taxable sales in the category of building materials, gardening equipment and supplies in Clark County increased 13 percent for the fiscal year through April compared with the same period last year. Overall, local taxable sales are up 4 percent year-over-year.

The local housing industry and our overall economy aren’t out of the woods yet, but these are positive indicators that give us reason to hope for better days ahead.

This increasing demand for new homes is putting some pressure on pricing. Home Builders Research reported that the median price for a new home in metropolitan Las Vegas was $254,550 in May, an increase of $61,046, or 32 percent compared with the same period in 2012.

The homebuilding industry is concerned about rising prices. We don’t want to see potential homebuyers shut out of the American dream of homeownership, which is so central to our way of life in this country.

Builders are back to the problem they faced during the boom years of the mid-2000s — the dwindling supply of available land for home construction, and in particular, “finished lots” that are ready to go for home construction.

The majority of land that could become available for development is held by the Bureau of Land Management, which must follow strict protocols and procedures for the release and sale of public land in the Las Vegas Valley.

It’s going to take some time for the Bureau of Land Management, local governmental jurisdictions and the building industry to work out the details for upcoming sales of public lands, but we’ll move forward with the best of intentions for the good of our community.

Please send your questions about new homes to monica@snhba.com. We will try to answer as many questions as we can given space and time limitations and constraints. For more information about Southern Nevada Home Builders Association, visit www.snhba.com. This column is published bimonthly.

Rocky Cochran, vice president of construction operations at Pardee Homes, is the 2013 president of the Southern Nevada Home Builders Association, the largest and oldest trade organization representing the residential construction industry in Nevada. He is a third-generation homebuilder.