Home prices spring forward amid tight supply

A recent Las Vegas Realtors report shows local home prices rising to another record and more homes being sold despite a tight housing supply.

LVR (formerly known as the Greater Las Vegas Association of Realtors) reported that the median price of existing single-family homes sold in Southern Nevada through its Multiple Listing Service during March was $363,000. That breaks the all-time record set in February. March’s median home price is up 13.8 percent from $319,000 during the same month last year.

Prices for local condos and town homes also increased compared to one year ago, selling for a median price of $194,000 in March. That’s up 4.6 percent from $185,500 in March of 2020.

“This is the first month where our housing statistics show a year-over-year comparison to the beginning of the pandemic,” said 2021 LVR President Aldo Martinez. “At the rate we’re going, we could see even greater gains in home prices and sales next month, since the housing market stalled briefly last April before roaring back since then.”

Martinez, a longtime local Realtor, said the shortage of local homes available for sale continues to present a challenge for potential buyers and a rare opportunity for sellers. While a six-month supply is traditionally considered to be a balanced market, the pace of local home sales in March compared to the number of existing homes available for sale equates to well under a one-month supply. He doesn’t expect much relief from homebuilders, who cite soaring lumber costs, increasing government regulations and lack of land and labor among the reasons they aren’t building more homes.

By the end of March, LVR reported 1,772 single-family homes listed for sale without any sort of offer. While up from the previous month, that’s still down 68.8 percent from one year ago. For condos and town homes, the 597 properties listed without offers in March represent a 63.3 percent drop from one year ago.

LVR reported 4,724 existing local homes, condos and town homes were sold during March. Compared to the same time last year, March sales were up 35.1 percent for homes and up 39.8 percent for condos and town homes.

Local home sales are on pace to exceed last year’s total. According to LVR, the number of existing local homes, condos, town homes and other residential properties sold in Southern Nevada during 2020 was 41,617. That was up from 41,269 total sales in 2019.

Southern Nevada’s housing market hit its post-recession bottom in early 2012. Since then, it has experienced steady year-over-year growth averaging 6 percent to 10 percent. Since the pandemic started, Martinez said the local housing market has been more in line with national trends, “exceeding everyone’s expectations.” He attributes “the current abnormal price growth” to a shortage of homes available for sale, steady demand and relatively low mortgage interest rates.

“The pandemic has contributed to the supply shortage due in part to homeowners being out of work, and therefore unable to upgrade even if they wanted to unless they could pay cash,” he added. “In addition, reports from the National Association of Realtors show homeowners are staying longer in their homes, up from five to seven years in recent history to closer to seven to nine years, today, which could also be attributed to lower than normal interest rates.”

During March, LVR reported that 24.1 percent of all local property sales were purchased with cash. That’s up from 21.2 percent one year ago. That’s well below the March 2013 peak of 59.5 percent.

Despite the ongoing pandemic and accompanying economic downturn, the number of so-called distressed sales remains near historically low levels. LVR reported that short sales and foreclosures combined accounted for just 0.6 percent of all existing local property sales in March. That compares to 2 percent of all sales one year ago, 2.5 percent of all sales two years ago, 2.9 percent three years ago, and 9.8 percent four years ago. Martinez explained “these low numbers are skewed by the number of homeowners who have filed for mortgage forbearance,” adding that “economists suggest many of these homeowners may have difficulty coming out of forbearance and expect foreclosure numbers to rise above pre-pandemic rates.”

These LVR statistics include activity through the end of March 2021. LVR distributes statistics each month based on data collected through its MLS, which does not necessarily account for newly constructed homes sold by local builders or homes for sale by owners. Other highlights include:

■ The total value of local real estate transactions tracked through the MLS during March was nearly $1.7 billion for homes and more than $217 million for condos, high-rise condos and town homes. Compared to one year ago, total sales values in March were up 65.2 percent for homes and up 52.6 percent for condos and town homes.

■ Homes have been selling faster than they were one year earlier. In March, 84 percent of all existing local homes and 80.9 percent of all existing local condos and town homes sold within 60 days. That compares to one year ago, when 72.4 percent of all existing local homes and 76 percent of all existing local condos and town homes sold within 60 days.

Las Vegas Realtors was founded in 1947 and provides its more than 15,000 local members with education, training and political representation. The local representative of the National Association of Realtors, LVR is the largest professional organization in Southern Nevada. Each member receives the highest level of professional training and must abide by a strict code of ethics. For more information, visit LasVegasRealtor.com.