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Aug. 07, 2007
Copyright © Las Vegas Review-Journal

Realtors group reports more homes are for sale

By HUBBLE SMITH
REVIEW-JOURNAL
Housing
Housing in Las Vegas
More Information

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Slow home sales and declining prices haven't stopped owners from putting their properties up for sale in Las Vegas.

More than 5,600 single-family homes were added to the Multiple Listing Service in July, bringing the inventory to a record 24,087, the Greater Las Vegas Association of Realtors reported Monday. That's up 1.9 percent from June and 18.8 percent from a year ago.

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    • "We knew inventory would climb in the summer," association President Devin Reiss said. "That's typically when people buy and sell."

    Sales activity dropped 34 percent from a year ago to 1,318 transactions in July and the median price fell 4.8 percent to $295,000, the first time it's gone below $300,000 since April 2005.

    Robin Camacho of Direct Access Lending said her statistics show that Las Vegas housing prices have dropped further than the median price suggests.

    "I believe sales will remain slow for about another year and that prices will drop another 4 (percent) to 5 percent over the next year, not nearly as bad as the gloom-and-doomers are predicting," she said. "Any drop is terrible for the homeowner, and uncertainty is a terrible feeling, but I don't think we're going to see prices tumble as some folks seem to think needs to happen."

    Reiss said the numbers are further proof that the housing market has tilted toward buyers and that sellers will have to adjust.

    "Obviously it's extremely competitive. You need to do everything you possibly can to get your home exposed," he said. "You need to get the home looking as best as possible. Buyers have lots of options. Of course, most important is price. You can price it at the one-year price, the six-month price or the one-day price."

    More than half of all single-family homes and 46.8 percent of all condos and townhomes sold within 60 days. Sales volume totaled nearly $500 million in July, a 33 percent drop from a year ago.

    The median sales price for condos and townhomes was $195,000 in July, down 3.2 percent from a year ago. Listings increased 28 percent to 6,269 and sales decreased 40 percent to 303 units.

    Association statistics are based on data collected through the MLS and do not account for new homes sold by local builders and other transactions not involving a Realtor.

    Debi Averett of Phoenix-based Housingdoom.com said she's especially concerned about the credit crunch that continues to worsen. Not only are subprime mortgages gone, but so are most of the so-called Alt-A loans, she said. These are loans in which the borrower possesses a strong credit history but needs nontraditional underwriting and processing.

    "Mortgage brokers are complaining that it's hard to write anything that is not a conforming loan. What's left of the nonconforming market is seeing big interest rate increases, so my best guess at this point is that it just got a lot tougher to buy a home with a mortgage over $417,000," Averett said.

    "Mortgage brokers are expecting even more credit tightening in the next week, so it's impossible to say just how much of a squeeze this is going to put on home sales."

    Preforeclosure filings and homes lost to foreclosure are up on both a per-capita basis and in sheer numbers for the year's first seven months, California-based Foreclosures.com reports. About nine preforeclosures were filed for every 1,000 households through July, compared with 4.9 filings per 1,000 households for the same period a year ago.

    "The numbers are dismal, but we had better get used to it because the blood-letting likely will continue for another 12 to 18 months," Foreclosures.com President Alexis McGee said. "It's a tough reality, but many more overextended homeowners not even in default yet won't be able to refinance because of tightened credit markets and will eventually lose their homes to foreclosure."

    Reiss said it's hard to tell when the number of foreclosures in Las Vegas will peak as a result of subprime mortgages. Most of them adjusted after a two-year period, so they may have already gone through the cycle, he said.

    "As far as lenders, everyone's a lot more stringent. They're pulling back the reins and being more cautious. It'll be a while before they start feeling comfortable, but eventually they'll relax," Reiss said. "Meantime as properties come on the market for sale and continue to add to the inventory, we'll continue to see a drop in prices."



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    alan berk wrote on August 25, 2007 08:16 AM: Stupidest real estate market in the country

    People paying hugely inflated prices for houses in summerlin and and other places you have to commute to work from!

    Builders still building in places like Mountains edge and other places way out side the city!

    There shouldn`t be a new house built in the valley for the next 2 years at least!

    When flipping houses and people trading houses like stock - you know it`s insane!

    Get real buy your house because you want to live in it and not some kind of eternal money machine- That it goes up in value is just a side benfit of owning a house!

    Maybe people will start to understand and move to the older nighborhoods of already established homes and make them into communities instead of living in a sterile cookie cutter tract!


    Bob Jack wrote on August 14, 2007 09:42 PM: Your article is must reading for every realtor, buyer and seller in the Las Vegas real estate market. It is well balanced and realistic in its assessment of current trends and the existing state of the market. While it makes no specific reference to the importance of momentum in market trends, it does indeed recognize the inevitable importance of momentum in its predictions of price trends and the market recovery time that will be required.

    As the number of days on market increases for sellers, and the median price of homes refuses to trend downward more quickly the market recovery time will only lengthen. Sellers unfortunately still do not have a handle on the extent to which this market is overpriced or an accurate picture of their competition in this market ---24,000 existing homes, and a standing inventory of 2,000 new homes is formidable competition for sellers.

    Unfortunately, but predictably, sellers when confronted with this picture by their realtor, tend to "kill the messenger". This is a shame because realtors who are attempting to educate their sellers on the hard facts of this market are doing a great service to the market's ultimate recovery, and to their sellers.


    Ed wrote on August 11, 2007 10:02 PM: Non-desperate people please pull your houses off the market.

    Right now at the rate of 1378 home sales per month, and 24,087 homes on the market we have a 17 month supply now w/o another new listing coming on.

    Realtors could fix this problem in 30 days... FIRE your unrealistic homesellers (give the listings back, morons).


    DHS wrote on August 08, 2007 08:40 PM: Dang, AMP noticed that too. I was reading the article thinking the same thing....how could half sell within 30 days, when only a small percentage of all available homes were sold in the first place?

    When Mr. Reiss stated that they expected inventory to increase because "That's typically when people buy and sell.", he left out one minor detail....that people aren't, ahem, "buying".


    AMP wrote on August 08, 2007 12:12 PM: "More than half of all single-family homes and 46.8 percent of all condos and townhomes sold within 60 days."

    Ok, the article also states inventory of 24,087 and sales of 1,318.

    So that means that 2.75% of SFHs (1/2 x 1,318 / 24,087) on the market sold within 60 days, 2.75% sold in more than 60 days, and 94.5% DID NOT SELL.

    Statistics are fun.


    Vegas Bob wrote on August 07, 2007 11:54 PM: Real Estate Expert. Comon man, have you not been reading the financial business reports? Even the Real estate Fat Boys at GLVAR have stopped their denial of the obvious. The housing Bubble like the Dot Com Bubble in 2001 has burst. The price deflation fall out will Catch alot of little and big fish in their web of Greed, stupidity and deceit. It will take until 2010 0r 2011 to work its way back to traditional appeciation trend lines.


    Real Estate observer wrote on August 07, 2007 11:44 PM: J and Real Estate Expert, I laugh at your BS...name one zip code in LV that is up 10%! Every builder has lowered base prices on housing. The only are that still is pushing speculative numbers in the high rise condo craze on the Strip. For Single family homes None of the MLS or RealTraq data support your contention that hosuing is up, Dooofus. Stop deluding yourself. By the way, I sold my home and one investment property in 2005. Most of us who saw this coming got out before the current collapse. If things are so great smart guy, why dont you go out and start buying? No guts no glory! Schmuck


    J wrote on August 07, 2007 09:51 PM: You guys must just thrive on negative speculation. What's wrong -- did you fail to get in on the process before it was too late? Houses in my neighborhood are UP 10% per square foot in the past 9 months. Go infect another city with your negativity.


    Real Estate Expert wrote on August 07, 2007 09:36 PM: You folks are fools.


    Real Estate Observer wrote on August 07, 2007 08:49 PM: Its clear that many homeowners are trying to get out front of the tidal wave of foreclosures and pricing declines heading toward the shoreline we call the Las Vegas valley. Pricing will be 20% to 30% lower in 12 to 24 months due to the wholesale collapse of the real estate market.


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