Las Vegas Housing Market Update: April 2010

Image source: http://www.lvrj.com/business/existing-home-sales-rise-in-april-94761909.html

April's numbers for Las Vegas were a bit of a mixed bag; the RJ article cites statistics such as:

• 3,724 existing home closings (+2% compared to same month 1 year prior)
• $128,000 median existing home price (-1.6% compared to same month 1 year prior)
• 2,146 foreclosures (+91% compared to same month 1 year prior)
• REOs account for 43.6% of all closings in April 2010.
  
• Short sales account for 27% of all closings in April 2010.

As always, we encourage savvy readers to go to the source, which has this data in tabular format and has charts/graphs to make the data easier to digest. It is noteworthy that the source cited here is from GLVAR, which does account for sales that occur outside of the MLS; interestingly, the number of closings reported between the RJ article and GLVAR is substantially different this month.

According to GLVAR:

• 2.951 total homes sold
• $140,000 median price
• 51.6% of homes sold were sold in less than 30 days
• 68% of homes sold were sold in less than 60 days
• 7,207 total number of homes available on the MLS without offers (anecdotally, it is very tight out there for home buyers!)

The statistics give us little or no predictive power regarding the direction of the market; most experts appear to agree that the artificially constrained inventory (more than 70% of closings are REO or short sales) will last a while, but not forever.

Counterpoint:
The sudden increase in number of foreclosures in April, along with the expiration of the federal tax credit could create a momentary "dip" in the amount of sales. The spectre of inflation and consumer confidence continues to send ripples through the country, especially as the European markets continue to feel waves from Greece's financial instability. Those expecting a "U-shaped" recovery in Las Vegas (or anywhere else in the country) may be disappointed.

The net of these variables is simple: Las Vegas' housing market is likely going to stay within a narrow range for the foreseeable future. Paradoxically, the shortage of inventory (speculatively, intentionally created by banks with REO/short sale inventory) has little or no impact on upward pricing pressure.

Posted By: David Kang