Sunday, August 17, 2008

Sales Statistics Brighter for Las Vegas Real Estate

Things seem to be looking up in Las Vegas according to the statistics, no matter what the national media is reporting. In July 2008, 3036 units were sold, and inventory ended the month at 22,178. At the current rate of consumption, that is 7.3 months of inventory, and many Las Vegas new homes developments are reporting waiting lists again. For those who are wondering when the bottom is going to be reached, we are getting very close to what has historically been called a “normal market”.

And for those that think they can lowball the already ridiculous foreclosure prices on Las Vegas homes, think again. There were 3036 closings in July, and here are the averages between list price and sales price:

For units that sold for under $500k, the average unit sold for $2,888 less than the asking price.

For all units selling under $1m, the average unit sold for $3,855 less than the asking price.

For ALL units selling in July, (including the multi million dollar penthouses and homes which bring the dollar amounts up) the average unit sold for $5,326 less than the asking price.

1,220 of the 3036 units that closed in July 2008 closed at a HIGHER sales price than their asking price. In other words, 40% of the homes sold, actually closed at more their advertised list price. The low prices on Las Vegas foreclosures are generating multiple offers on each property and creating mini bidding wars reminiscent of the "golden years" of 2004 and 2oo5.

Another good indicator is the percentage of listings taken vs sales over the past few years. In 2008 so far 34% of all listings taken have sold as opposed to 2007 when only 24% of all listings taken sold.

And it looks like with the anticipated population growth over the next 12 years, that things will start moving back up in price. Jeremy Aguero, a principal at Applied Analysis, was quoted in the paper saying he expects "Southern Nevada’s population by 2020 will grow to 3 million, from 2 million”. The Clark County School District is the fifth-largest school system in the country with 308,783 students, and district officials predict enrollment will grow to 473,000 students by 2018. Pointing to projects such as the CityCenter development under construction on the Strip, Aguero said, "We're not going to have all the employees to fill all the jobs we're going to create in the next 10 years."

Think about that for a minute. That means that there will have to be a roughly 50% increase in housing over what is currently built. With the scarcity of land for sale in Las Vegas, prices may just start creeping up before the analysts are predicting. This is one real estate agent who definitely thinks we are seeing the bottom of the market and is buying as much as she can.