Southern Nevada new home sales improve some in May

Changes for the better are hard to come by for home builders in Las Vegas, as marketing their product continues to face an uphill battle. In the meantime the existing home sector is getting a lot of attention from buyers and investors thanks to the low price structure there, that being the main reason for the yawning disparity. Both are struggling equally with tight mortgage guidelines, scarce down payment accounts and the adverse effects of the high unemployment here.

The May housing report, created by Home Builders Research, does offer some hope for new homes, namely in the number of sales they generated. 378 of them were closed, which is a bit better than the April’s total of 343. In a year-to-year comparison things look awful, though, with a drop of 59%, as 921 units were sold in May of 2008. Still, currently there is gradual upward movement in sales, in slow motion to be sure, and that is as much as anyone can hope for in this recession environment.

The price structure continues to hamper the building industry in Las Vegas. With a median price of $212,900 a new home has very little appeal when the median value of an existing property is somewhere around $140,000, dragged down that far by a bunch of foreclosures and bank REOs. The gap is simply too wide to overcome, in spite of the new smell inside the model home stimulating the prospect’s nose. The powerful dollar mode seems to be easily dominating his brain function in this situation. Can't fault him for that.

Silverstone Ranch, Las Vegas, in the photo.

Las Vegas resale housing inventory drops in May

Another whiff of optimism over the local real estate market blew into Southern Nevada this week. Any small improvement anywhere in the industry stats is nowadays welcomed with wide-open arms. So, let's take it.

In the new statistical report on the housing market here just released, the Greater Las Vegas Association of Realtors, or GLVAR, says that the inventory of homes fell by 9.3% from the same time last year. Moreover, there were 21,181 units in it in May, about 1,000 less than in April when the number stood at 22,112. This statistic has remained alarmingly high despite the rather strong sales lately in the lower half of the market. A steady flow of bank REOs being listed has kept the figure up there. Now there seems to be a small break to it, even a decrease by 1,000 homes is in some way an encouraging sign that perhaps a new trend is developing. Many are waiting for the day when the total inventory number sinks below 20,000, and stays there. And keeps going south.

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Southern Nevada one of the most undervalued housing markets

Let's go right to the point. In the 10 Most Undervalued cities Las Vegas came in third, according to IHS Global Insight. The firm put this special report together by analyzing household incomes, historical prices and housing densities and then arrived at statistically normal home prices which were subsequently weighed against actual values of a given city. The difference then either placed the area in the overvalued or undervalued category.

In this particular study, Las Vegas median home price was discovered to be $140,000, meaning that it is 40.9% undervalued. That is a high number.

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Las Vegas new single-family house sector draws recovery prediction

Plenty of time and money is spent annually in foreseeing the future in all sorts of areas. From the familiar to the bizarre. As expected, the mortgage and housing markets have seen their fair share of this. Some of these studies are more accurate than others, after they are later independently checked for accuracy. But overall, the results of these novel exercises appear to be off the mark, sometimes way off.

In any case, here is the latest for Las Vegas, Nevada. According to a new real estate market study completed by the Concord Group, Southern Nevada can expect its new single-family home sector to pick up in the first quarter of 2012. 2012? That comes to about three years from now. This national projection relies on analysis of unsold inventory, anticipated shifts in the employment picture and demand, which are rather decent criteria.

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