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Las Vegas new home sales tumble to 23-year low
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LAS VEGAS REVIEW-JOURNAL
Las Vegas new home sales fell to a 23-year low in 2011, according to a report Monday by a real estate research firm.
Economists say Las Vegas is on the road to recovery but the home building industry is years away from returning to any sense of normalcy, housing analyst Dennis Smith of Home Builders Research said Monday.
Just looking at the levels of new home sales since 1995 should dismiss any "delusion" of how the industry has changed, he said.
Smith counted 374 new home sales in December, bringing the total for 2011 to 3,894, the lowest number since he began tracking the market 23 years ago. New home sales topped 20,000 in 1998 and peaked at nearly 39,000 in 2005.
"It's not good from the perspective of where it once was," Smith said. "The good is that I really feel 2011 is the worst year in terms of sales. The worst is past us."
Where does the market go from here?
Not too far, Smith said in predicting about 4,000 new home sales this year and 4,200 in 2013.
It's all keyed to resale price and home equity, he said. Most Las Vegas homeowners are "stuck" owing more than their home is worth, making a move difficult or impossible, the analyst said.
"They have issues to deal with, but once that dam breaks, I'll be interested to see how lenders react because there will be demand," Smith said. "Will rates go up? Will lenders go back to making lending easier for people?''
The median price of a new home in December was $121,250, a decrease of $5,830, or 2.7 percent, from a year ago, Home Builders Research reported.
For resales, 2011 was a fantastic year, with 48,822 sales of existing homes -- the fourth-highest on record.
Smith tallied 64,168 existing home sales in 2004, 58,522 in 2005 and 49,792 in 2003. The median resale price declined 7.6 percent to $110,000 in December. It has bounced around that price for the last eight months.
Prices are still falling, though no longer "free falling," and sales volume has recovered nicely in the existing home market, said Larry Murphy of Las Vegas-based SalesTraq.
He reported 3,793 new home sales in 2011, a 30 percent decrease from the previous year. Median price fell 3 percent, to $200,184. Existing home sales increased 15 percent to 58,778, while the median price fell 11 percent, to $105,714.
"Recovery is a long way off, but the worst of it is now behind us," Murphy said.
He said his biggest concern right now is that three-fourths of homes sold in 2011 were distress sales, either foreclosures or short sales, and a majority of those were vacant.
Also, two-thirds of homeowners with a mortgage are "underwater," and another 100,000 homes will likely be foreclosed upon in the next few years.
"At the present rate, when this housing crises is over in about four more years, nearly one-third of all homes in Las Vegas will have been foreclosed upon. That is a staggering number," Murphy said.
Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.
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Just keep selling to the Asians, they own massive chunks of the U.S. already. Don't legislate against HOA's, they are a piece of the profit pie for builders. The bottom is still a ways off. Agents and brokers are on the same level as used car salesmen and lawyers.
Gee.... what do you expect when there are so many vacant homes all across the Las Vegas valley and resale homes are $50,000+ less then a new home on average?
If the libs in Government would get out of the way so the bad home loans could be cleared and new owners that can afford to keep up their homes were allowed to purchase, we'd get out of this mess sooner for a truly sustainable recovery and new home builders might have a market again.
Not sure if you actually know this but MARXISM states Socialism is the by product of capitalism. The class struggle in marxism is due to the need of materalistic items and wealth. If ANYTHING Capitalism has done just that. Our country is looking to even the wage gap; Socialism did not create: The issues with Wall Steeet, the housing decline, or our jobs goinf overseas. Capitalism and greed caused that. "Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge, has marked the upward surge of mankind and greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the U.S.A" Gordon Gekko
@GBIGS I am not speaking of deadbeats Gwendolyn. I am speaking for the people actually trying to pay their mortgage. I am talking about the ones who got caught up in the lot of criminals that assisted in this mess. Banks are not 100% innocent and you should know that.I AM SICK OF THE GNOMES LIKE PETER GRIFFIN. Please Gretchen,you are a punchline here at my job .
@GARYD Reid was reelected because the person running against him is a bigger moron than he is. FYI ANYONE who says, " Liberal Socialist Marxist Dumbobagger Sheep" is someone brainwashed by FAUX and EQUALLY as worthless as a Liberal Socialist Marxist Dumbobagger Sheep. Just saying
@Peter Griffin ----- Just a reminder, maybe you didn't read it in the papers "HARRY REID GOT ELECTED - NOT SHARRON ANGLE !!!" --------------------------------------------------------------------------------------------------------------------------------------- Why can't you Liberal Socialist Marxist Dumbobagger Sheep put the blame where it belongs ????
there is nothing illegal about a foreclosure. banks are being wrongfully demonized for kicking out people who have BROKEN their side of the contract-bargain. I AM SICK OF THE GNOMES LIKE PETER GRIFFIN who want to give deadbeats a house for 6-months free while the EXTENDED and IDIOTIC process has been pushed out to please the vast majority of Dem deadbeats. while these homes sit with non-paying occupants, THEY ARE NOT BEING PUT BACK ON THE MARKET AND CLEARED. that hurts everyone who is paying their mortgage and want to sell their house.
Can one call the NV Dems clueless when the Nevada GOP's candidate was Sharron Angle. We can blame the DEMS all we want but if the GOP puts WACKKOS against IDIOTS... IDIOTS (REID) will always win.
FYI this legislation keeps people in houses rather than an empty house not being kept up. Even you should see the good in that GBIGS. An empty trailor next to your lowers the value of yours. DUH
As usual GBIGS is clueless. FIRST: Dems in LV are not AS BRAIN DEAD as the Nevada GOP. SECOND: the reason foreclosures are NOW being delayed is because the foreclosures were being done ILLEGALLY. Thanks to legislation banks cannot foreclose unless they have the proper paperwork. IMAGINE THAT. I know you don't want people breaking the LAW GBIGS.