90°F
weather icon Clear

Las Vegas market still big for homebuilders, but sales down

Updated July 19, 2022 - 10:19 pm

Four communities in Southern Nevada are among the top 20 nationally for homebuilders’ sales this year, but overall, house hunters are pulling back from last year’s buying binge amid higher mortgage rates.

Builders logged 592 home sales this year through June in Summerlin, the fourth-highest among U.S. master-planned communities, according to a report Monday from real estate consulting firm RCLCO.

Summerlin’s sales total, however, was down 38 percent from the same period last year.

Builders sold 459 homes in Henderson’s Cadence community, seventh-most in the nation; 388 in Henderson’s Inspirada community, 12th most; and 333 in Skye Canyon in the upper northwest valley, 18th most, RCLCO reported.

Sales in Cadence were up 4 percent year over year but down 16 percent in Inspirada and 11 percent in Skye Canyon, according to the report.

Las Vegas Valley communities are regularly among the top-selling spots in the country for homebuilders, and this year is no different. Summerlin, for instance, spans 22,500 acres along the valley’s western rim, boasts more than 100,000 residents and has long been a big source of new-home sales.

But as the report shows, home sales are falling in Southern Nevada and around the U.S. amid a sharp increase in mortgage rates that have made it more expensive to buy a place following a year of huge price gains.

Collectively, homebuilders’ sales this year in the 50 top-selling master-planned communities across the country dropped by 18 percent from the same period last year, RCLCO found.

Builder confidence also “plunged” this month as high inflation and increased interest rates “stalled the housing market by dramatically slowing sales and buyer traffic,” the National Association of Home Builders said Monday.

“Affordability is the greatest challenge facing the housing market,” Robert Dietz, chief economist of the builder association, said in a news release.

Higher mortgage rates have wiped out the cheap money that fueled America’s unexpected housing boom after the pandemic hit. The average rate on a 30-year home loan was 5.51 percent last week, up from 2.88 percent a year ago, mortgage-finance giant Freddie Mac reported.

“With rates the highest in over a decade, home prices at escalated levels, and inflation continuing to impact consumers, affordability remains the main obstacle to homeownership for many Americans,” Freddie Mac Chief Economist Sam Khater said in a news release.

In Southern Nevada, builders sold single-family houses for a record-high median closing price of $497,210 in May, up 17.6 percent from a year earlier, according to Las Vegas-based Home Builders Research.

Buyer traffic, however, fell to its lowest level of the year.

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

THE LATEST
Walkability key to downtown Las Vegas growth, developers say

Two Las Vegas developers said they’re encouraged by the recent growth in downtown Las Vegas, adding that there’s several years worth of projects still possible.