Las Vegas Real Estate Market September 2008
Sep 8th, 2008 by Forrest
Well . . . here’s a new acronym that we need to get accustomed to . . . FHFA (Federal Housing Finance Agency)! So what does that mean? You may want to read the Statement by Secretary Henry M. Paulson, Jr. on Treasury and Federal Housing Finance Agency Action to Protect Financial Markets and Taxpayers that was made September 7, 2008. Essentially Fannie is on her fanny and Freddie has lost credi-bility and both are in conservatorship. The stock market loved the news and gained 300 points today as a result of the move by the FHFA. The best guess on the streets is that interest rates will drop and credit will be even tougher to obtain. So for the moment we are left with a mix of joy and anxiety until we actually see what this move means to the Las Vegas market.
Meanwhile, the Greater Las Vegas real estate market still benefits from the momentum of closings from previous months! Bank owned REO sales still account for nearly seventy percent (70%) of all residential closings. The number of available listings dipped somewhat, but still hovers around around that 15,000 number for single family residences. But here are some new Greater Las Vegas stats related to financing - and they are a dramatic shift from the beginning of 2008:
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Cash 16% of all closings in August
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Conv 39%
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FHA 39%
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VA 5%
The overall numbers are looking very good despite the fact that we are moving into the slower time of year. So, lets first download and take a look at: August 2008 Resale Market Snapshot.
We continue to see 40% of closings selling under 90 days on the market with an average of 60 Days on Market. The remaining 60% still suffer an average of 230 Days on Market.
Listing prices have now dropped 25% since September 2007 while closed sales are now staying nicely above 2006 numbers for the same period. Again the is the fourth consecutive month that we have had more than 2000 single family home closings. Closed sales prices dropped just over 1% this past month while list prices declined nearly 3%. At the same time overall inventory generally held constant. The average Cumulative Days on Market is still 162 days and this market continues to carry a high number of overpriced listings in inventory. Yet the 30-day absorbtion rates in the 16.5-17% range are a welcome sight, especially when compared to the same time last year!
The current momentum continues to set a good tone for the balance of 2008. (See SFR Sales Trends 2004 - 2008). In fact, it’s looking like that the remainder of 2008 may trend above the same period for 2006, even with a normal seasonal downturn in closings. Finally - despite all the bad news and press - you have to love the direction and course of our local Las Vegas market!
But let’s stay Focused on Price Reductions and assist even more sellers by getting their listings in “The Selling Zone”!