LV homes relatively affordable, data find

Las Vegas ranks as one of the nation's more affordable housing markets in the 2007 Home Price Comparison Index by Coldwell Banker.

The average price for a four-bedroom, 2,200-square-foot home in Las Vegas is $362,188, on par with similar homes in West Hartford, Conn. ($365,000), and Provo, Utah ($363,975).

Las Vegas is much closer to Killeen, Texas, the most affordable U.S. housing market at $136,725, than Beverly Hills, Calif., the most expensive market at $2.1 million.

Eight of the 10 most expensive markets are in California. Six of the most affordable markets are near U.S. military bases.

It comes down to the old real estate adage, "Location, location, location," Coldwell Banker Premier Realty President Bob Hamrick said. People continue to move to Las Vegas for the lifestyle, new jobs and promotions and to raise a family, he said.

"The real estate market in Las Vegas is different than a year ago," Hamrick said. "Our market has experienced a slowdown in sales and an increase in inventory."

Nevertheless, buyer opportunities abound, he said. Those opportunities will begin to disappear as home builders reduce their inventories.

Home Builders Research reported 766 new home permits in August, the second straight month below 1,000. The permit count is down 38.1 percent for the year at nearly 11,000.

"It's going to get more affordable," Debi Averett of Phoenix-based Housingdoom.com said.

In a recent national news report, Ed Leamer, an economist at the Anderson School of Management at the University of California, Los Angeles, said home prices in California, Nevada and Arizona are going to fall 20 percent. He's been predicting the bursting of the "housing bubble" for at least the past five years. His early predictions called for a 30 percent drop in West Coast home prices.

Through August, existing home median prices in Las Vegas have fallen 5 percent to $275,000 following double-digit gains during the years Leamer said they were going to plummet. New home prices are up 4 percent to $338,560, according to Home Builders Research.

Leamer's predictions go as far back as 2000 and until recently, he's been way off base, Las Vegas economist Thomas Climo of Dr. Climo Consulting said.

"In fact, considering how he missed the huge bubble of 2004, even his accuracy concerning current events, when his predictions are compiled and consolidated, would show a significant negative decline not in conformity with the evidence," Climo said.

Coldwell Banker's Home Price Comparison Index looked at 394 metropolitan markets across the United States, Canada and Puerto Rico.

Although the index focuses on a "snapshot" look at subject homes and is not intended to show overall market conditions, a comparison of the 2007 and 2006 surveys shows that 148 markets saw a rise in value and 139 saw a dip.

Cities that rank nearest the index's national average of $422,343 include Modesto, Calif. ($421,667); Minneapolis, Minn. ($415,767); and Frederick, Md. ($415,000).

Local real estate consultant John Restrepo said home prices are only half the story on affordability.

"The other half is income," he said. "When you look at price vs. income, we're not an affordable community. I think we're less affordable than we used to be with the ramp-up of prices in '04 and '05."

A report from housing analyst John Burns shows the proportion of housing cost-to-income in Las Vegas at 50 percent, compared with 99 percent in Los Angeles (Beverly Hills) and 24 percent in Killeen, Texas.