Median home price rises slightly; sales still weak

The median new-home price has bounced around $200,000 for most of the year, avoiding the distinct downward tendency seen in the previous three years, said Dennis Smith, president of Home Builders Research.

He expects to see a continuation of the up-and-down pattern in prices for much of 2012, showing negative year-over-year percent change one month and positive change another month.

The median price for a new home in Las Vegas dropped from $234,173 in January 2009 to a low of $186,957 in June 2010 and has remained above $200,000 for all but a couple of months since then.

Smith said he’s comfortable in predicting there will not be a sustained downward movement of new-home prices going forward.

Home Builders Research counted 365 recorded new-home sales in November, bringing the total for the year to 3,520 sales, a 30 percent decrease from a year ago. It’s the lowest count since the firm began tracking the Las Vegas housing market in 1988.

In resales, transactions are popping to the tune of 4,000 a month for most of the year, peaking at 5,000 in August. There were 4,148 resale transactions in November, compared with 3,354 in the same month a year ago. Through November, resales are up 14 percent to 44,181, on pace for the fourth-highest number on record.

The median resale price fell 5 percent from a year ago to $114,000 in November. The good news is the price has climbed four consecutive months. That doesn’t suggest a change in price trends, Smith said.

“We still believe the new-home prices have bottomed, but resale prices are more closely tied to the huge supply of distressed properties,” he said, “And we believe there are still enough of them not yet counted in the inventory to keep resale prices trending down for much of 2012 and possibly further.”

Homebuilders pulled 250 new permits in November. The year-to-date total of 3,348 is down 21 percent from a year ago. Just five years ago, the total was 23,200 new permits.

Smaller builders have left the market. Meritage Homes is closing operations in Las Vegas. Most recently, William Lyon Homes filed for bankruptcy protection, listing more than $600 million liabilities. The Newport Beach, Calif.-based builder plans to seek court approval for a restructuring plan that will cut debt by about $182 million, while raising $85 million in new equity.

“It is truly amazing how much the new home industry has changed,” Smith said.

Smith pointed to encouraging data in other segments of Las Vegas’ economy, including growth in gaming, tourism and conventions. Slow, steady improvement in the engine that runs the local economy could shape a broader recovery, he said.

“All in all, the housing industry is definitely in better shape today than it was in November of last year,” Smith said. “Those (builders) that are still active should enjoy a better year next year. We are planning on our sales and revenues increasing by about 10 percent in 2012.”

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