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Las Vegas Valley – Continuing to Grow The Las Vegas metropolitan area continues to be a growth story with some of the largest private investments in the world. Multiple cranes rise over the Las Vegas Strip while concrete and steel make daily increases in height. Over $6 Billion of hotel and resort construction is expected to be completed in 2008 followed by over $20 Billion in completions in 2009. Population continues to surge with 5,000 to 6,000 drivers licenses surrendered each month through the Nevada DMV. This migration creates a very organic demand for housing which will serve to alleviate the excess in the overall housing supply. Experts predict strong job prospects on the horizon. Forbes.com ranked Las Vegas one of the top ten best cities in the U.S for jobs. Mark Zandi, chief economist for Economy.com stated that Las Vegas, along with Phoenix and Riverside, “are good fundamentally solid economies and should rebound strongly.� Although our city has great growth and prospects, the existing home inventory still needs to be absorbed. As of the end of June 2008, existing home inventory on the multiple listing service was 20,554. If Las Vegas grows by 50,000 residents this year, a significant amount of the existing supply should be absorbed. At 2.3 persons per household , approximately 22,000 homes are required to support this incoming population. Some proportion will fill into existing apartment, single family home and condominium vacancies as renters while it is likely that many others will choose to become or remain homeowners. Las Vegas has typically enjoyed a homeownership rate of about 60%. The choices for new home buyers are decreasing. As of June, we estimate that only 800 single family homes are complete and unsold, while new condo/townhome inventory is estimated at about 1,500, which includes condominium conversions and high-rises.

1 3

Las Vegas Convention and Visitors Authority Hotel/Casino Development Construction Bulletin. 2 Center for Business and Economic Research. Forbes.com, Best and Worst Cities for Jobs, April 10, 2008. 4 Calculated from the 2006 American Community Survey.


Selling Your Home

HOME RE-SALES (LESS THAN $1M) 2002 THROUGH JUNE 2008 50,000

Knowledge of the neighborhood, an analysis of

45,000

competitive new and re-sale home prices and sales rates are

40,000

fundamental in formulating a list price. The best option in

35,000

the current market is to find experienced Realtors® who

30,000

have strong knowledge of particular neighborhoods and

25,000

are immersed in the market on a daily basis. In the first

20,000

half of 2008, Coldwell Banker Premier Realty listings sold

15,000

for an average of 96% of list price. 14% sold above list

10,000

THRU Q2 07

5,000

price with 30% selling at or above the listed price.

2002

2003

2004

2005

2006

2007

2008

SOURCE: MLXCHANGE

Existing Home Sales Re-sale homes have seen declines in yearly sales since 2004, with 2007 sales falling below that of 2002. So far in 2008, re-sales have already matched 60% of what was sold in all of 2007. Many buyers are recognizing the great values found in scores of Las Vegas homes and seizing the opportunity to acquire a great property. We also took a look at differences between the average days homes spent on the market in the first half of 2007 and 2008. What is noteworthy is that in the ranges below $400,000 where the majority of homes were sold, the days on market have not changed significantly. This is likely a reflection of the price decreases made to get these properties sold in a time acceptable to the owners and lenders.

SINGLE FAMILY DAYS ON MARKET COMPARISONS FIRST HALF 2007 VS FIRST HALF 2008 $800,000 – $1,000,000

$600,000 – $800,000

$400,000 – $600,000

$250,000 – $400,000 2008 2007

$150,000 – $250,000 50

100

150

200

250

300

DAYS ON MARKET CONDOMINIUM DAYS ON MARKET COMPARISONS FIRST HALF 2007 VS FIRST HALF 2008 $800,000 – $1,000,000

$600,000 – $800,000

$400,000 – $600,000

$250,000 – $400,000 2008 2007

$150,000 – $250,000 50

100

150

200

250

300

DAYS ON MARKET SOURCE: MLXCHANGE, COLDWELL BANKER PREMIER REALTY


New Home Sales New home closings are substantially lower in the first half of 2008 compared to the same period last year, as homebuilders compete with existing inventories. In recent months, closings have become more stable. There are some exciting opportunities in the new home market. Many communities offer varied lifestyle options and amenities and builders are offering homes at prices more competitive than many of the existing homes. NEW HOME CLOSINGS & PERMITS

NEW & EXISTING HOME PRICES

2,500

$400,000

$300,000

1,500

SALE PRICE

NUMBER OF PERMITS/CLOSINGS

$350,000 2,000

1,000

$250,000 $200,000 $150,000 $100,000

500

n -0 8 Ju

8 r -0

r -0 8

y -0 8 Ma

Ap

b -0 8

Ma

n -0 8 Ja

New Home Closing Price (median)

Fe

7

c -0 7 De

t -0 7

v -0 No

p -0 7

Oc

Se

g -0 7

l-0 7

New Home Permits

Au

n -0 7

Ju

Ju

7 r -0

r -0 7

y -0 7 Ma

Ap

b -0 7

Ma

n -0 7 Ja

Fe

n -0 8 Ju

8 r -0

y -0 8 Ma

r -0 8

New Home Closings

Ap

b -0 8

Ma

n -0 8 Ja

Fe

7

c -0 7 De

t -0 7

v -0 No

p -0 7

Oc

Se

l-0 7

g -0 7 Au

n -0 7

Ju

Ju

7 r -0

r -0 7

y -0 7 Ma

Ap

b -0 7

Ma

Ja

Fe

n -0 7

$50,000

Existing Home Closing Price (median)

SOURCE: SALESTRAQ, CLARK COUNTY, CITY OF LAS VEGAS, CITY OF NORTH LAS VEGAS, CITY OF HENDERSON

Price Guarantees Several home builders are adapting to the market by offering some type of a price guarantee, with various programs available. For instance, some builders will protect buyers from decreases in prices on the same floor plan on future construction stipulating if the price of the floor plan that a buyer is purchasing decreases within a set timeframe before they close escrow, they will offer the homebuyer the lower price. While other home builders are bolder and will guarantee that in the event they lower prices within a certain time frame after the home buyer closes escrow they will send them a check for the difference.

Valley Home Type Composition Home prices are popular citations in the current discussion of real estate. We look at what types of homes formulate those figures. Based on sales in the first half of 2008, we summarize some basic home characteristics so we know what to expect in the listed price ranges. In the first half of 2008, the greatest amount of single family and attached homes transacted in the re-sale market was in the $150,000 to $250,000 range. Some of these homes were purchased at bargain prices. The average re-sale single family home within this $150,000 to $250,000 range was 1,699 square feet, which is a great opportunity for first time home buyers or even for those moving up. With a good sized initial investment and the ability to secure a home loan, this market holds great opportunities many have been waiting for.

SINGLE FAMILY HOME

CONDO / TOWNHOUSE

BASIC CHARACTERISTICS

BASIC CHARACTERISTICS

PRICE RANGE

AVERAGE SQUARE FEET

AVERAGE YEAR BUILT

AVERAGE # OF BEDROOMS

PRICE RANGE

AVERAGE SQUARE FEET

AVERAGE YEAR BUILT

AVERAGE # OF BEDROOMS

$150,000 – $250,000

1,699

1997

3

$150,000 – $250,000

1,335

1997

2

$250,000 – $400,000

2,399

1999

4

$250,000 – $400,000

1,398

2000

2

$400,000 – $600,000

3,188

2000

4

$400,000 – $600,000

1,213

2003

2

$600,000 – $800,000

3,573

2000

4

$600,000 – $800,000

1,341

2003

2

$800,000 – $1,000,000

3,904

2001

4

$800,000 – $1,000,000

2,113

2005

2

$1,000,000 – 1,500,000

4,383

2000

4

$1,000,000 – 1,500,000

2,337

2005

3

$1,500,000 – $2,000,000

5,201

2001

5

$1,500,000 – $2,000,000

2,435

2003

3

$2,000,000 – $2,500,000

5,455

2004

4

$2,000,000 – $2,500,000

4,055

2003

3 SOURCE: MLXCHANGE

CBPR DEEMS INFORMATION RELIABLE BUT NOT GUARANTEED.


FORECLOSURES LAS VEGAS HOME FORECLOSURES

The Las Vegas market is being driven by bank-owned properties. 64% of closed sales for the month of June were

6,000

banked owned, while 52% of the sales placed in escrow

5,000

were bank-owned. The good news is that the listing

4,000

inventory slid for the 10th month in a row dropping from

3,000

28,200 to 20,554. The number of foreclosures dipped for

2,000

the first time since the fall of 2007. Full recovery requires

1,000

a substantial decrease in inventory; it’s called supply and demand and our supply is decreasing. With approximately nine months of inventory, we are moving back towards

J 07

F

M

A

M

J

J

A

S

O

BANK ACQUISITIONS

a “normal” market.

N

D

J 08

F

BANK DISPOSITIONS

M

A

J

BANK OWNED Source: SalesTraq

short sales The Short Sale market is comparable in numbers to the non-foreclosure sector at approximately 28% of the total listings and sales. Although the difficulty of negotiating with lender mediation departments has increased the workload for Realtors, skilled Short Sale specialists have contributed to the increase in the number of Short Sales closing since January of 2008.

53% of property on the market is vacant This figure has increased 9% over last year’s report but has remained steady for nearly a year. The majority of these are obviously foreclosures but there are still investor and second homes factoring into this number as well.

M


Luxury Home Re-Sales On a yearly basis, re-sales have been declining since 2005. Re-sales of luxury single family homes (over $1 million) decreased 53% from the first half of 2007 to the first half of 2008, which was a substantial decline. However, when reviewing the details, some price ranges saw nearly an equivalent amount of transactions. The $3,000,000 and greater range actually fared quite well. Luxury condominiums fared similarly between the first half of 2007 and 2008. Overall, the trend in sales between single family and condominium are comparable. At the end of June 2008, the multiple listing service had approximately 1,200 homes priced above $1 million listed for sale.

LUXURY SINGLE FAMILY HOME RE-SALES 2002 THROUGH JUNE 2008

luxury SINGLE FAMILY HOME sales

700 600 500 400 THRU Q2 07

300 200 100

2002

2003

2004

2005

2006

2007

50 40 30 THRU Q2 07

20 10

2004

2005

2006

2008

152

67

$1,500,000 – $2,000,000

57

19

$2,000,000 – $3,000,000

27

16

$3,000,000 – $4,000,000

11

13

$4,000,000 – $5,000,000

2

1

$5,000,000 – $6,000,000

3

3

$6,000,000 +

3

1

TOTAL SALES

255

120

luxury SINGLE CONDOMINIUM sales

60

2003

2007

2008

LUXURY CONDOMINIUM RE-SALES 2002 THROUGH JUNE 2008

2002

PRICE RANGE

$1,000,000 – $1,500,000

2007

2008

PRICE RANGE

2007

2008

$1,000,000 – $1,500,000

2

9

$1,500,000 – $2,000,000

9

5

$2,000,000 – $3,000,000

9

4

$3,000,000 – $4,000,000

3

0

$4,000,000 – $5,000,000

0

2

$5,000,000 – $6,000,000

0

1

$6,000,000 +

0

0

TOTAL SALES

23

21 SOURCE: MLXCHANGE

SOURCE: MLXCHANGE

When evaluating the re-sale activity in some of the Valley’s most notable areas, an overall decline in the number of transactions is apparent. However, some areas saw notable luxury single family home re-sale activity, such as Southern Highlands and Summerlin. Movement also continues in the high-rise projects of Turnberry Place and Park Towers, which remain desired properties for urban living.

luxury high-rise sales CONDOMINIUM RE-SALES BY DEVELOPMENT 2007

2008

REGENCY TOWERS

3

0

PARK TOWERS

3

2

TURNBERRY PLACE

15

11

THE DISTRICT

1

0

PANORAMA TOWERS

1

0

SKY LAS VEGAS

0

3 SOURCE: MLXCHANGE


PROPERTIES SOLD

PROPERTY FEATURES

The luxury buyer is discerning and sophisticated and requires highly

130

BEDROOM DOWNSTAIRS

amenitized properties. A greater number of bathrooms, pools and increased garage

127

4 PLUS BATHS

space are typical requirements. Gated communities and homes within golf course

120

GUARD GATED

Luxury Home features

communities are still popular choices in the Las Vegas market. The table

78

3 CAR GARAGE

details some major features of Las Vegas re-sale luxury homes sold

69

COMMUNITY TENNIS

in the first half of 2008.

53

GOLF COURSE VIEWS

52

COUNTRY CLUB

Most Expensive Homes Sold by Coldwell Banker Premier Realty

49

POOL

39

GATED COMMUNITY

36

FIRST LEVEL MASTER

28

4 CAR GARAGE

For three consecutive years Coldwell Banker Premier Realty has been proud to represent the clients of the most expensive properties purchased either in the single family or high rise categories.

$9,000,000 – 2005-2006 Park TowerS Penthouse

$9,000,000 – 2006-2007 TOURNAMENT HILLS Estate

$19,000,000 – 2007-2008 MacDonald Highlands Estate

This year’s property was sold by one of our luxury agents in the Green Valley office. The $19,000,000 sale is the single most expensive residence sold during the last four years.

LAS VEGAS…An Improving Market Unlike many markets in the country, Las Vegas’ real estate market is showing signs of improvement and is in recovery. The number of sales has been climbing every month since January and outpacing sales numbers from 2 years ago…during a very strong market. The listing inventory has been diminishing and the downward trend on sale prices is slowing. Buyers are getting excellent values on homes and sellers are realizing that they must price their property in line with the market to compete effectively to sell. This trend will continue for a time, but not for the long haul. The old adage for acquiring wealth “sell when everyone is buying and buy when everyone is selling” is truer now than ever. Our economy is still strong and with our continued increase in population, Las Vegas remains the best bet for businesses and families to thrive. For market data and information specific to your neighborhood, call your agent.

Bob Hamrick – Chairman of the BoarD


| las vegas, nevada 89117 10120 South eastern avenue, suite 300 | henderson, nevada 89052 6628 sky pointe drive, suite 200 | las vegas, nevada 89131 8290 west sahara avenue, suite 100

lasvegashomes.com

CBPR DEEMS INFORMATION RELIABLE BUT NOT GUARANTEED.

Las Vegas Valley Residential Report: Mid-Year 2008  

Coldwell Banker Premier Realty Las Vegas Valley Residential Report: Mid-Year 2008

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