Mid 2019 Las Vegas Real Estate Update

Mid 2019 Las Vegas Real Estate Update


Hi everyone! So this is Jim here and we are in July already. So we are halfway through the year already
and I thought it would be a good time for me to just give you guys a market update actually. The real estate market in Las Vegas is in
an interesting place right now. We have a lot of different news. Some say the market is turning. Some say the market is still booming. Some people wanting to cash out right now. Some people are still investing because “oh
the Raiders are coming” and things like that. So I just wanted to clarify and give you my
perspective and let’s start with some market stats here. So up to the halfway point of this year, we
have already sold 14,741 single family homes in Las Vegas. Almost 15,000 home sales have happened this
year already. That’s a really good number. In the last 30 days, meaning the month of
June really, there were almost 3,000 homes that sold. The average sale price of homes in Las Vegas
for this year is $357,000. So that’s an increase from last year as well. The median home price is $304,000. And the average days on market in Las Vegas
right now is 45 days on market and the median is 26 days. So if you guys are curious what the difference
between average versus median is. Average is all the sales divide by number of sales. Median is if we were to take off the top number
and the bottom number and keep doing that until we found the middle number, that’s what
the median is. So I actually think the median number is a
better indication of what the market really is like because you know a $20 million dollar
home may skew things. A $50,000 condo may skew things. A home that sells the very first day on market
may skew things. And then maybe you know a short sale or probate
sale or some thing like that sits on the market for over a year will skew things too. So I like the median number a lot. So just to let your know, $304,000 is the
median home sale price and 26 days is the median days on market. Price per square footage, this is something
a lot of people care about too. The average in Las Vegas is $172/sqft. The median is $167/sqft. So those are the average and median price
per square footage. Of course this varies tremendously from area
to area. You see areas in Summerlin that are well over
$200/sqft already. So again those are averages and medians. Overall, it’s a healthy market.So people are
saying “so what are you trying to say Jim?” The market here is very healthy alright. We came out of a very slow winter and first
quarter this year. I think a lot of that had to do with interest
rate increases at the end of last year that continued on into our first quarter. In the second quarter, interest rates dropped
and it just created another boom in the real estate market. Right now, we are seeing rates as low as the
high 3s which is the lowest they have been for several years now. It is bringing the buying power back to buyers
now. So you are seeing a healthy market. There are a lot of purchases happening. That’s really definitely helping our market. But you also see the contradiction because
like I said, coming out of a slow winter, we saw days on market really really increase
which lead people to believe that the market is changing. “Oh, it’s changing from a buyer’s market to
a seller’s market. Days on market are increasing. We are seeing a lot of price drops.” This is true. However, some of those price decreases were
a result of sellers that were over ambitious we’ll say with their sale price. Like you know they saw a home sell for let’s
say $300k around the corner from them. Well they are thinking to themselves “well
the market is going up. I’m just going to list mine for $325k.” For no reason at all really, they are just
saying “well the market is going up. Raiders are coming. I want $25k more than my neighbor that sold
the same house.” Those people kinda got a reality check and
that’s where you saw the price decreases come from. The market value is determined by what a buyer
is willing to pay for. So right now, just to give you an idea, we
are not seeing people bid over list price that often. It happens very seldomly. Where you will see that happen is probably
in the $200s price range. Because like I said, the median is over $300k
already. So anything over $300k is going very fast
still and you are seeing maybe some bidding wars and things like that. But overall, a real balanced market actually. And something to put into perspective a little
bit. Currently, right now, we have just under 8,000
homes on the market right now. Actually 7,800. There are 4,000 homes that are pending right
now and we are closing around 3,000 a month. If there were no new homes coming on the market
and we were selling around 3,000 a month. We would be out of homes for sale in less
than 3 months. So historically that would say that we are
in a seller’s market still. But it is different now because we had less
than 2 months inventory last year and the previous year. So things have changed a little bit. It’s not as crazy as a seller’s market where
you put the home on the market and you are getting 20 offers right away. Right now, it might take a week or so to get
a couple of offers. Or if any offers depending on price point. So the market has shifted a little bit, but
by no means is it a time to panic and “it’s going to be a buyer’s market. I’m waiting for things to crash again before
I buy.” I don’t think we are close to that right now
so overall it is just a good healthy market with the low rates. Buyers have a little more choice and they
don’t have to be, you know, trying to outbid cash investors from out of state all the time
anymore. We’re in a good market. It’s balanced more. I would say it might be a little bit on the
seller’s side, but a lot better than the previous years where it was a crazy seller’s market. It’s definitely shifted over to the buyer’s
side as we are seeing sellers actually willing to contribute towards closing costs again. Our market right now is demanding a better
product too. Before, you used to put any house out there
and people were going to bid on that house. Right now, buyers have a few more choices
and they are expecting homes in better condition as well too. Continuing on with the statistics, the average
and median list to sales price ratio, so how close are we from list price to the actual
sales price, we are still at 98%. So most sellers on average are getting at
least 98% of what their asking price is. Again which suggests a healthy market. That’s pretty much it. Just to wrap this up, my take on all this
is that Las Vegas is still just a great place to invest in. I think Las Vegas is a younger city. We are not like San Francisco or LA where
we’ve been around for hundreds of years. We have a newer city here and we are still
growing. We are in a growing phase right now. We are seeing rents increase at a rapid pace
right now. I know that people can remember when the rental
market was $1,100 – 1,200 was very common. $1,200 was the going rate for many years there. Right now, it is about $1,500, is probably
the average rent now. It has increased tremendously and a lot of
that has to do with all the people relocating here, mostly from California. An interesting statistic that I found also
is between the years 2013 – 2017, 56% of new arrivals in the city of Henderson all were
from California. I know that is kind of a specific stat but
I think that really gives you the point of why home prices and rents have increased so
much. Because the people that are moving here are
used to paying higher rents and higher prices for homes as well too. I think Henderson and anything in the South,
Southwest, Silverado areas, Southern Highlands, places like that, even Mountain’s Edge are
attractive to people coming from California just cause that’s what they’ve seen when they
drive into town from the 15 right. Those are the fastest growing areas still. But there is so much going on. I’ve mentioned the Raiders thing a couple
times. I say that kind of sarcastically because everyone
is really excited about it. But hey so am I. The convention center is set to be expanded
by 2023. Projects on the Strip like Resort World is
something that they are building right now. It is right across the Wynn. That’s going to be kind of an Asian themed
casino. It’s where the Stardust used to be if you
guys remember where that was. The Drew is going to be what Fountain Blue
was. That was an unfinished casino in front of
Circus Circus. That’s going to be called the Drew. They are working on that. And then finally, there’s going to be a lot
of stuff. I think SLS is going to be rebranded as Sahara
again because it’s kind of iconic. The projects that are happening in Vegas are
pretty endless actually. Our economy is pretty strong. It’s hard to say. It’s really hard to say where we are headed. I mean right now with the economy being as
strong as it is, we’re pretty safe here in Vegas for a good real estate market for some
time to come. And of course, if you ever want to call and
chat with me about this, I would love to expand on anywhere in particular with you. So thanks for watching and if you have any
comments or anything like that, please let me know. I’d love to hear what you think or what your
opinion on all this is. But that’s it. Halfway through 2019, real estate in Las Vegas
alright. I’ll talk to you guys soon.

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