New-home market experiencing flat results in Vegas

It’s definitely not the worst of times for Nevada’s new-home market, but it’s certainly not the best of times, either.

In fact, the market should prepare for six to eight months of flat results, said Dennis Smith, president of Home Builders Research, in his latest Las Vegas Housing Market Letter.

First, “the reality is that consumer demand is short of where many thought it would be going into 2015,” Smith said.

That’s partly because incomes in Las Vegas remain 25 percent below their 2006 peak, at a per capita median of just under $39,000 in 2013, according to the St. Louis Federal Reserve Bank.

Plus, “vast majority” of new subdivisions opening today are of the “bigger, pricier” variety, Smith said, so the market is seeing an affordability issue. The median price of local new homes sold in September was $299,601, up $30,127, or 11.1 percent, compared with September 2013.

What’s more, the number of available new homes in the most affordable category is shrinking fast. Just 7.8 percent of local new homes were priced at less than $200,000 in September, down from 18.3 percent in the same month a year earlier.

Meanwhile, homes priced from $400,000 to $499,999 jumped from 7.6 percent to 11.2 percent of the market. The share of homes in the $200,000 to $299,999 range stayed mostly steady at 45.3 percent, down only slightly from 46.4 percent a year earlier.

On top of wage and pricing issues, the market is bumping into the usual seasonal home-sales slowdown that visits the fourth quarter. Altogether, those multiple factors make a recipe for a sluggish few months ahead.

Builders closed on 4,338 homes in the first nine months of 2014, down 1,310 units, or 23.2 percent, compared with the same period of 2013, Smith said.

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Keller Williams buys new home

Keller Williams Southern Nevada has a new office building.

The real estate brokerage spent $3.1 million on a 15,224-square-foot space at 10424 S. Eastern Ave.

TMC Financing provided $1.3 million through an Small Business Administration 504 loan for the buy. Bank of America covered the rest of the loan.

Jaime Velez, operating partner of Keller Williams Southern Nevada, said the company needed more space to handle growing sales volumes. The brokerage is on track to post 30 percent more sales in 2014 than it experienced in 2013; it ended the third quarter with $163 million in sales, and should surpass $200 million by the end of the year, Velez said.

Keller Williams Southern Nevada doubled its space with the new building, which is designed to accommodate the brokerage’s growth for several years.

“With the Las Vegas real estate market expected to continue its recovery over the next two years, we are looking forward to a stabilization that will lead to new growth opportunities,” Velez said.

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Home Builders elect

The Southern Nevada Home Builders Association will install its 2015 officers and board of directors at an awards luncheon Dec. 4 at the Four Seasons.

Officers who will serve in 2015 include President Larry Simon of Pardee Homes and First Vice President Frank Wyatt of Pinnacle Homes.

Builders elected to the 2015 board are: John Cahlan of Pulte Homes; Ray Huff of Beazer Homes; David Jennings of DR Horton; Rob Keune of Pardee; Brian Kunec of Richmond American Homes; Wayne Laska of StoryBook Homes; Brandon Laughter of Pulte Homes; Kent Lay of Woodside Homes; Janet Love of KB Home; Jeremy Parness of Lennar; and Tom Warden of The Howard Hughes Corp.

Associate directors are: Greg Combs of Cal Pac Painting of Nevada; Claire DeJesus of the Las Vegas Review-Journal/New Homes Guide; Scott Donnelly of Cooper Roofing and Solar; Brian Gordon of SalesTraq/Applied Analysis; Chad Hirschi of Hirschi Masonry; Bill Ickes of Silver State Specialties; Rebecca Merrihew of Red Rock Insulation; Ken Williams of CAMCO; and Darren Wilson of Sierra Air Conditioning.

Contact Jennifer Robison at jrobison@reviewjournal.com. Follow @J_Robison1 on Twitter.