Las Vegas home sale prices rise in September

Median prices for both new and existing homes rose slightly in September from the prior month, though they're still down from a year ago, Home Builders Research reported Wednesday.

Sales of new homes increased for the third straight month, part of some encouraging data for the Las Vegas housing market, Home Builders Research president Dennis Smith said.

He counted 405 new-home sales in September at a median price of $206,480, an increase of $7,875 from the previous month but down 3 percent from a year ago.

New-home builders, struck by the recession, tight lending and competition from foreclosures, have recorded 2,788 sales through the third quarter, a 35 percent decrease from the prior-year period.

The drop in new-home sales is largely due to comparing this year's figures with those enhanced by the federal tax credit in 2010, Smith noted.

Resales fell by 557 units to 4,281 in September, still an impressive sum, the Las Vegas Smith said. The third-quarter total of 35,828 represents an 11 percent increase from last year.

The existing home median price inched up to $108,100, a gain of $1,100 from August.

Homebuilders pulled 252 new-home permits in September, the lowest level since February. Permits, a good indication of future housing starts, are down 24 percent for the year at 2,901 single-family units.

The U.S. Department of Housing and Urban Development on Wednesday reported 658,000 privately owned housing starts in September, seasonally adjusted, 15 percent above the revised August estimate and 10.2 percent above the September 2010 rate.

Smith said he agrees with Republican presidential candidate Mitt Romney. During Tuesday's nationally televised debate in Las Vegas, Romney said the best way to solve the foreclosure crisis is to let the free-market system run its course.

"I don't see what the big problem is with letting the system work out the solution," Smith said. "Basically, that's what we've been doing up until now. Attempts by the federal government and the state to solve the foreclosure crisis haven't worked much at all.

"The logistics of the housing depression are so deep and broad, it would take all involved to work together to dig out of the recessionary hole," he added. "It seems so fundamental to suggest the first and basic fix must be to deal with the excess of inventory homes. That begins with keeping current homeowners in their homes."

Las Vegas-based SalesTraq reported similar housing data for September. The median existing-home price edged up to $104,200 from $103,500 in August, while new-home prices increased to $202,595 from $197,490. Those prices are down 11.5 percent and 5.2 percent, respectively, from a year ago.

Sales of existing homes, driven by investors buying foreclosures and short sales, continued to show strength, rising 14.8 percent from a year ago to 4,992 in September.

"September's housing data is more of the same," SalesTraq President Larry Murphy said. "It's tempting to look at minor upticks and minor downticks each month and try to extract from them a morsel of significance, but the truth is, nothing has changed."

About half of all home sales in Las Vegas are real-estate owned, or bank-owned, while one-fourth are short sales, or lender-approved sales for less than the principal balance owed, according to real estate agency Residential Resources.

SalesTraq showed an average price of $85,000 for 570 auction sales in September; $113,000 for 891 short sales; $103,000 for 2,235 REO sales; and $107,900 for 1,296 traditional sales.

"Many people are obsessed with finding the bottom of this market," Murphy said. "I believe that we have been on the bottom for over two years now, and that we will stay there another two years."

Murphy defines the "shadow inventory" differently than most. It's not the 10,000 homes already taken back by the banks that have not yet hit the market. That number pales in comparison to the number of homes likely to be foreclosed upon in the future, which could easily approach 100,000, Murphy said.

"Regarding a recovery, I believe that the resale housing market will have to recover first, followed by the new-home market," he said. "I say that because 80 percent of existing homes being sold today are vacant. 

"As long as this condition exists, demand for new construction is going to remain anemic."

He reported 399 new home sales in September, a 10.9 percent drop from a year ago.

Nevada has experienced both ends of the housing spectrum over the past few years, from the peaks to the valleys and even underground, said Al Peterson of Huntington Beach, Calif.-based HouseHunt. Prices are up in some areas of Las Vegas, but have remained flat overall.

Aliante and Coronado Ranch showed a 3 percent decrease in prices the past few weeks, while Blue Diamond Ranch, Canyon Gate, Summerlin, Green Valley and Henderson are all holding steady, Peterson said.

"From the agents I've talked to in other parts of the country, most see prices going up a tad in the coming months," he said. "Not much, but everyone seems to think the bottom has been reached. Of course, Nevada and Arizona could be different because of all the short sales and foreclosures that have yet to flood the market, but that's the consensus."

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.