Current Las Vegas Market Individual Charts
Current Las Vegas Market Report
Market Overview
This year is now 11.1% off the 2021 pace but is tracking closely to the 2019 market; closings at this pace could easily end up at 32,000 – 35,000 by the end of the year. Available SFR inventory improved from 4209 units to 6362 units while listings taken in June were approximately 680 more than in May. The SFR market sits at 2.5 months of available inventory even as the condo and townhome segment rose to 1.9 months of inventory. The average days on market inched up to 17 days.
The median sales price of SFR closings slipped to $480,000 from $481,000 while the SFR average closed sales price jumped to $593,941 from $574,968 for a one-month increase of 3.3%. The very high end of the luxury market had slightly fewer closings that last month, but overall closings above $700,000 remain strong. However, there are fewer closings and more contractions at the lower price points. Strong high-end closings continue to put upward pressure on the market prices as evidenced by the nearly $19,000 increase in average closed sales prices.
Mindset Caution
The real estate market is returning to more normal conditions where both buyers and sellers have a more equal ability to negotiate that dream home. The Las Vegas market rose to 2.5 months of SFR inventory, nearly that threshold of three months where the markets is considered fairly balanced. Generally, neither party has inherently more ability to negotiate than the other when there is 3 to 6 months of inventory. This market has been so far below the three-month threshold that sellers held most of the trump cards during initial negotiations, except for the luxury market which has been in balance for quite some time.
Clearly a balanced market is most welcome as it will slow down the double digit rise in market values and squeeze out the overpricing. Listing agents may need to get a grip of the shift and hone their sales and negotiating skills while adapting to these changes. However, that’s the macro-view of the market. The chart below shows that various communities around the valley are each responding to the market changes in their own way. Some communities still only have about one month of inventory while a number of other communities are already at the 3 to 6 months of inventory levels. A few are even higher!
It’s time for all of us to adopt a change in mindset that reflects the current market and economic conditions in the specific market areas we work. Temper news and media reports on the market with that in mind. Then pass accurate market conditions on to your clients and prospects! This market is replete with opportunity
Mindset Caution – Continued
It didn’t take long after the latest mortgage interest rate hike for every real estate guru and pundit across the nation to put their Chicken Little hat on and begin forecasting the onslaught of a gloomy real estate market. We can pick up almost any newspaper and read about sellers slashing prices as if to infer panic selling and rapidly declining market prices.
No one variable – including mortgage rate increases – will be the sole determining factor that shapes the future of Las Vegas real estate. What about the recent and alarming downward trend overtaking Wall Street and the stock market? Some investors may already be liquidating some of their stock positions and looking towards real estate for future returns. The remarkable increase in rental markets across the United States makes the real estate market attractive to those individuals. Inflation and soaring gasoline prices already have more than a few homeowners searching for a home closer to work and schools! Each individual buy and sell decision encompass factors unique to that transaction.
Finally, all real estate is local, if not hyperlocal. What’s happening in one community or subdivision is not necessarily occurring in the adjacent community. Market changes are far more complex and dynamic by nature. We are only about halfway through 2022 – leaving plenty of time for market, economic, political, and even social forces and values to shape the future of the 2022 Las Vegas real estate market. One or two data points do not constitute a trend, so I prefer to let the future market data and statistics tell us what the market is doing or saying.
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