Having a REALTOR who is up-to-date with the market makes all the difference. Whether it’s to get the best deal when purchasing a home or to get top dollar when selling it! Kandis and I pride ourselves on our obsession to keep current with the trends to give our clients a valuable advantage.
With the 2014 year-end data in, we wanted to touch on a few topics of conversation to help inform everyone on the latest in the Southern Nevada Real Estate market.
1) Market Prices – The Median Price of a Single Family Home for 2014 ended at approximately $199,900. That’s an increase of nearly 11% in just one year! With many investors leaving the market because of the increases (cashing out), traditional Buyers are back in the mix. While the prices have somewhat stabilized we should see a much more “normal” pricing increase of 1%-3% in 2015 as inventory remains low.
2) Housing Inventory – As noted above, the housing inventory is still incredibly low. In a healthy housing market we should have somewhere around a six-month supply of homes. Currently we’re less than a three-month supply of inventory. With an average of 2,500 single family residences exchanging hands each month there are only 6,758 currently for sale in the Las Vegas Valley. So, in effect, there’s really not enough supply to keep up with the demand!
3) Interest Rates – Record low interest rates are still happening — but for how long?! Banks have loosened up on their underwriting guidelines and are lending money once again. As of today a 30-year Conventional Loan offers an interest rate as low as 4.15% and an FHA Loan at 3.35% for 30 years too…. with as little as 3.5% down! We don’t know how long these ultra-low rates will be around so now’s the time to take advantage.
4) New Home Construction – New home construction has slowed down dramatically as the housing inventory for the resale market increased in 2014. The other factor is that Builders are asking for more per square foot on their base models than the price of most resale homes. They’ve adjusted their prices slightly, but to counter that they’ve withdrawn a majority of Buyer incentives such as free appliance upgrades or closing cost help.
5) Short Sales and Bank Owned – Is there a bigger misconception in our market than these two types of sales? Probably not! Short Sales make up less than 15% of the homes currently available and, with banks offering loan modifications or other government assisted foreclosure alternatives, short sales are less and less common these days.
Bank Owned properties make up less than 5% of our market and their prices are typically higher than the average resale comparable homes sold. Why is that? How can that be? Well, there are government programs (Homesteps and Homepath) that have looser lending rules, and which allow Buyers to work around appraisal contingencies. This essentially allows them to borrow more money than these homes are worth, so the banks increase the prices to compensate for the programs.
As always, I hope this blog helps and if Kandis and I can help answer any questions just Call/Email/Text us anytime!
Las Vegas Strip photo by: nanpalmero