Las Vegas home prices rising fast as sales tumble

Las Vegas’ housing market ended 2018 with fast-rising prices — and started 2019 with sharp drops in sales.

Southern Nevada home prices were up 11.4 percent year-over-year in December, more than double the national rate of 4.7 percent, according to the S&P CoreLogic Case-Shiller index released Tuesday by S&P Dow Jones Indices.

Las Vegas’ growth rate was fastest among the 20 markets in the report for the seventh consecutive month, and it was the only metro area with double-digit year-over-year price gains in December.

Overall, the U.S. housing market has cooled off, and buyers – especially “well-heeled” ones willing to pay “top dollar in pricey communities” – are gaining leverage in a growing number of markets, Aaron Terrazas, senior economist with listing site Zillow, said Tuesday.

But, he added, “the crunch is still on in more affordable areas,” with many buyers still facing some competition, albeit “somewhat less” than they did a few months ago.

In Southern Nevada, home prices have been rising fast amid an expanding population and strengthened job market. But sales have tumbled amid affordability concerns, and the region’s once-depleted inventory of available houses has soared.

The median sales price of previously owned single-family homes last month was $300,000, up 13.2 percent from a year earlier, and 1,823 houses traded hands in January, down 19.4 percent year-over-year, according to the Greater Las Vegas Association of Realtors.

At the same time, 7,254 single-family homes were on the market without offers at the end of January, up almost double from a year earlier, the trade group reported.

Meanwhile, homebuilders last year closed the most sales in Southern Nevada in more than a decade and fetched record prices. But they started 2019 with the fewest monthly closings in two years.

Builders closed 611 new-home sales in January, down 13.9 percent from a year earlier and the lowest tally since January 2017, according to a report Monday from Home Builders Research.

Buyers paid a median of $375,996 for last month’s closings, up 7.8 percent year-over-year, the Las Vegas firm reported.

Home Builders Research President Andrew Smith wrote in the report closings should post year-over-year declines “for the next few months” due to relatively slower sales in the second half of last year.

But overall, Southern Nevada’s homebuilding market “is performing well enough to temper some of the growing concerns” that many people felt last quarter, he said.

Smith noted that builders pulled 984 new-home permits last month, up 8 percent from a year earlier, and that sales contracts fell 4.4 percent year-over-year in January, a “pleasant surprise” given the “somewhat frighteningly low totals in November and December.”

Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.