Another month, another rise in Las Vegas home values

Las Vegas Valley home values kept soaring last month, far outpacing most of the country.

The region’s median home value was $151,600 in July, up 31 percent from a year earlier, according to a new report from Seattle-based housing data firm Zillow.

Las Vegas’ year-to-year growth rate was second-fastest among the 30 markets tracked in the report. Sacramento was first at 33 percent.

Nationally, home values rose 6 percent over the past year, to $161,600.

The market is expected to cool off in the coming year but remain strong. By July 2014, home values are forecasted to rise 11 percent locally and 5 percent nationally, Zillow said.

Las Vegas’ market has been fueled in large part by cash investors who, capitalizing on the housing bust, buy cheap homes in bulk to turn into rentals.

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House flipping slows in Las Vegas as bargains disappear

Flipping homes in Nevada is not as profitable or as common as it is nationally, a new report shows.

Single-family homes were flipped 2,923 times in the first six months of the year in Nevada, meaning they were sold within six months of being purchased, and the flippers booked an average profit of $15,205 per deal, according to research firm RealtyTrac.

Home flippers nationally earned 21 percent more — $18,391 on average, RealtyTrac reported.

Nevada had a 34 percent decline in housing flips compared to the first six months of 2012, but nationally, volume rose 19 percent to 136,184 transactions.

Although flipping remains profitable in most markets, it’s “tapering off” in regions with fewer distressed bargains, RealtyTrac Vice President Daren Blomquist said in the report.

“Out of the 100 markets we analyzed for the report, 32 had declining flipping numbers, including perennial flipping hot spots like Las Vegas, Phoenix, Southern California and Atlanta,” he said.

In Southern Nevada, foreclosure activity plunged the past few years after the state’s “robosigning” law made it harder for banks to seize homes from delinquent borrowers.

It’s difficult to buy a home in Las Vegas, whether you want to live in it or flip it. Las Vegas has relatively few homes listed for sale, partly because investors have bought cheap houses in bulk throughout the valley to turn into rentals.

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Demand for new homes in Southern Nevada eases in June

Sales of new homes began slowing last month in Southern Nevada amid scorching heat and rising interest rates.

But overall, the home construction market has been far more robust this year than during the same period in 2012, a new report shows.

Local homebuilders sold 3,618 new houses from January through June, up 75 percent from a year earlier, according to Las Vegas-based Home Builders Research.

The median price of June’s sales was $266,921, up 37 percent from June 2012.

Builders also pulled 3,770 new-home permits in the first half of 2013, up 30 percent from the same period last year, showing that construction plans remain strong.

Sales activity was robust from the get-go this year, with weekly sales reaching 1 to 1.2 per subdivision. That rate, however, inched lower in recent weeks to 0.8 to 0.9, Home Builders Research President Dennis Smith reported.

“This is still a very good, robust sales pace, but it signifies how demand has recently eased,” Smith wrote. “Is it due to the extreme heat in Las Vegas this summer? Seasonal? Rising interest rates? Have rising prices reached their limit (for now)?”

A heat wave struck Southern Nevada last month.

Meanwhile, the national average for a 30-year mortgage rate jumped in late June to 4.46 percent from 3.93 percent the week before — the biggest one-week increase since April 1987 and the highest rate since July 2011, according to mortgage giant Freddie Mac.

The rate hikes came amid talks that the Federal Reserve would start scaling back its bond-buying program later this year. The average 30-year rate has since cooled off but remains higher than last year.

It ended last week at 4.37 percent, compared to 3.53 percent a year earlier, according to Freddie Mac.

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Las Vegas Real Estate Market May be Turning Around

After five years of tough sledding, the Las Vegas real estate market may be turning around.  DataQuick reports that home sales in the city – which was among the metro areas hardest hit by foreclosures almost from the beginning of the housing crisis – were at a seven-year high in May with more expensive home sales and cash sales rising sharply.

The median price paid for a home in the city rose on an annual basis for the 14th consecutive month as buying shifted toward mid-to-high-end deals and the share of foreclosure resales declined.  A record 59.6 percent of sales were all cash.

There were 5,005 existing and new homes and condos sold in the Las Vegas-Paradise metropolitan area  (Clark County) in May, up 2.8 percent from the previous month and 3.6 percent more than in May 2012.  Last month’s sales were the highest for a May since 2006 when 7,615 homes sold and beat the average for the month (going back to 1994 when DataQuick began keeping records) by 0.3 percent.  

Sales, however, were lopsided on the existing home side with resales of homes and condos 28.1 percent higher than the May average and new home sales 52.1 percent below that average.  Sales were also skewed toward higher-end homes with sales of homes priced below $100,000 down 44.8 percent from May 2012 and 17.8 percent for homes priced under $200,000.    Sales of homes priced between $200,000 and $500,000, a range that would include many move-up purchases, jumped 76.9 percent.  

This trend helped push the median price of a home in the area to $162,000, the highest since December 2008 when it was $175,000, already well off the November 2006 peak of $312,000.  The median bottomed out at $110,000 in January 2012.  The May median was 1.3 percent higher than April and 32.8 percent above the price in May 2012.  This was the 14th consecutive month the median price has increased on an annual basis and those gains have ranged from 1.7 percent to 34.8 percent and in the double digits for the last 11 months.

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Prices Up, Housing Inventory Down in Las Vegas

The sound of construction can once again be heard in the Las Vegas valley after being silent for the past five years. When the housing market started collapsing in 2008, buyers were afraid to purchase homes and builders didn’t want standing inventory.

That’s what makes this development in the middle of the valley near Spring Mountain Road and Rainbow Boulevard so interesting.

“In-fill locations are always difficult to find,” said Jeremy Parness, the president of Lennar Las Vegas.

Lennar homes is one of the largest builders in Las Vegas. It has been sitting on parcels of vacant land for years waiting for the housing market to come back to life. The company has already sold 300 homes this year.

“We definitely believe we’ve found the stable bottom and we’re starting to find the momentum of recovery,” Parness said.

Lennar is seeing fewer investors buying homes and more families looking to make a commitment to a house. To attract families, builders are thinking outside the four-walled box and throwing in lots of extras.

“Washers, dryers, blinds, refrigerators, appliances,” Parness said.

“I’ve looked on the west side. I’ve looked on the east side,” said Kristopher Milicevic who is shopping to buy his first home. He’s been looking since the beginning of the year.

“I talked to the seller, they agreed to sell, I went and met with everybody, high fives, cheers and that type of stuff and all of a sudden he calls me and says nope she backed out. She doesn’t want to sell right now, she thinks she can get a better price,” Milicevic said.

He hopes to land a house soon because he’s noticed it’s been harder and harder to buy homes over the past few months.

“It’s a long-term investment for myself and also for my city. I grew up here, I’m a native. I want to see Las Vegas succeed and that’s one of the reasons I want to invest in this economy at this point.”

And builders agree the hammering and price bidding can build the foundation for a stronger local economy.

While the housing market might be making a recovery it is still nowhere near what it was like before the recession. According to the Greater Las Vegas Association of Realtors, the median home price in 2006 was $315,000. Today it is less than half of that.

Across the country, foreclosures are down nearly 30 percent from a year ago. The l

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Prices Up, Housing Inventory Down in Las Vegas

LAS VEGAS — The state of Nevada has teamed up with housing experts to grade the local housing market, and the marks are nothing to brag about.

The struggling housing market in Las Vegas is showing slow signs of improvement.

“Right now, I’m trying to buy a house and it’s been very difficult,” said Elizabeth Valles who is house shopping.

What she is finding out is that Las Vegas is a sellers’ market and finding a home to buy is turning into a frustrating experience. She has already looked at more than 20 houses.

Valles, hoping to get some guidance, attended a housing market forum held at The Orleans Hotel & Casino Thursday.

“Prices are skyrocketing now, but it’s because we have no supply. There’s about 1.3 months of supply in southern Nevada. There should be six months,” said Bruce Breslow, the director of the Nevada Department of Business and Industry.

The department’s brand new Nevada Housing Stability Index is out. The Silver State gets a “D” for underwater loans, a “D-” for foreclosures and a “F” for too many investors. The state earns a “B-” for new home prices compared to existing houses and an “A” for new construction supply and demand. The overall grade was a “D+” for the local housing market.

“The recovery is underway. Things are improving. They’re not improving as quickly as we would like, but it’s certainly a lot better than what it has been,”said Dr. Stephen Miller, professor of economics, UNLV Lee Business School.

“They’re getting ready to build again. Some are already building. A lot more will come, and we’ll see 5,000 to 10,000 new homes built,” Breslow said.

“We’ve got a long way to go and as residential recovers, hopefully commercial will not be too far behind,” said rick smith/chairman of executive committee, lied institute for real estate studies:

Valles will have her first home one day soon, but chances are, it won’t be tomorrow.

According to the latest Zillow Home Value Index, the median price of a home in Las Vegas in May is about $146,000. That’s an increase of 28 percent from this time last year.

 

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Home Values in Las Vegas jumped 28 percent, highest among large U.S. cities

Las Vegas home values are rising faster than any other major metro area, though at least one analyst expects things to cool down nationwide.

The valley’s median home value in May was $146,400, up 28 percent from a year earlier, according to a new report from Seattle-based Zillow.

That was the highest year-to-year percentage jump among the 30 largest regions covered in the report. Sacramento was second at 26.1 percent.

Nationally, home values rose 5.4 percent year-over-year to $159,000 last month, and they are expected to climb another 4.1 percent by May 2014.

According to Zillow, the pace of appreciation will slow because more sellers will list their homes and builders will ramp up construction. These factors will help “ease the supply crunch” that has heavily fueled the rapid increases in home values, Zillow reported.

“Enjoy it while it lasts, because the housing market will undoubtedly look very different a few years down the road from how it appears now,” Zillow chief economist Stan Humphries said in the report.

And, in an apparent reference to flippers, Humphries said buyers who are “in it for the short term could get burned if they assume home values will continue rising as they have unabated.”

In Las Vegas, sales prices are climbing as investors gobble up cheap homes in bulk to use as rentals, shrinking the inventory of homes for sale.

The median price of a previously owned single-family home sold in Southern Nevada last month was $170,000, up 33 percent from $128,000 a year earlier, according to the Greater Las Vegas Association of Realtors.

Meanwhile, a total of 13,814 single-family homes were up for sale on the GLVAR’s listing service at the end of May, down 20 percent from a year earlier.

Practically every house listed for sale in Las Vegas — distressed or otherwise — gets multiple offers. That’s due in part to the seemingly endless appetite of cash buyers to turn cheap homes into rentals.

And it doesn’t matter what kind of house is up for grabs. The price of distressed homes, for instance, is rising faster in Nevada than in any other state.

Nevada homes that were bank-owned or headed toward foreclosure sold for an average $144,182 in the three months ending March 31, up 22.7 percent from a year earlier, according to Irvine, Calif.-based RealtyTrac.

Nevertheless, Zillow’s forecast that price appreciation will slow nationally because of more listings and more construction could hold true locally.

One reason for the valley’s limited inventory is that Las Vegas is the underwater capital of America. Many people who bought their homes at inflated prices during the boom era are now underwater, meaning their debt outweighs their home’s value. They often refuse to list their homes for sale, as they would take a steep loss on the transaction and need bank approval for it.

However, the rate of underwater borrowers has eased in the past year, thanks to the rising home values. Some 54 percent of valley homeowners with mortgages were underwater in the quarter ending March 31, compared to 71 percent a year earlier, according to Zillow.

Meanwhile, home construction plans are ramping up.

From January through April, local builders pulled about 2,460 permits, up 55 percent from the same period last year, according to Las Vegas-based Home Builders Research.

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