New homes in Las Vegas are selling at prices not reached in more than eight years, according to a new report.
But anyone hoping for a quick return to the days of rapid-fire construction is in “for a rude awakening,” and overall, last month’s numbers “would again have to go into the ‘blah’ category,” says the report by Las Vegas-based Home Builders Research.
Builders sold 657 new homes in Southern Nevada last month. That brought the year’s tally through November to 6,104, up 13 percent from the same 11-month period in 2014, according to the report.
The median price of last month’s closings was $321,405, up 9 percent year-over-year and the highest in Las Vegas since August 2007.
Builders also pulled 437 new-home permits in November, the lowest monthly sum since January and well below the monthly average this year, 636.
Still, last month’s tally put the year’s total through November at 6,999, up 14 percent from the same period in 2014.
If prices keep rising anywhere near their pace in 2015, a new record would be set by mid-2016, if not by the end of the year, Home Builders Research founder Dennis Smith wrote.
During the housing bubble last decade, builders sold nearly 39,000 new homes here in 2005 alone.
But people who “still like to speak about the housing production reaching the levels prior to the recession, especially in Las Vegas, in the next three to five years are in for a rude awakening,” Smith wrote this week.
The market, he noted, remains bogged down by various problems — wages are largely flat for many people, and Las Vegas still has the highest rate of underwater borrowers among large U.S. cities.
Some 22 percent of Southern Nevada homeowners with mortgages were underwater — meaning their debt outweighs their home’s value — in the third quarter. That’s down from 27.8 percent a year earlier and far below its peak of 71 percent in early 2012, according to Seattle-based Zillow.
Despite the improvement, Las Vegas’ current share of upside-down borrowers was highest among the 35 metro areas listed in the report. The rate nationally is 13.4 percent.
“There will be no magic wand or solution to immediately cure this malady,” Smith wrote. “Only time will cure it.”