September was an interesting month for the Las Vegas real estate market. Rising interest rates continue to be the focal point of the conversation. Just as we reported that buyers can expect the slowdown of interest rate hikes in September, things quickly changed within a month. That’s why it is more important than ever to stay abreast of recent market developments so you can be informed on your next move going forward.
While homes are still more expensive today than before the pandemic, it’s important to identify opportunities, whether you are looking to buy or sell (but especially for buyers).
The median price for single-family units in Las Vegas is $450,000, which did not see any changes from the previous month. However, it did grow 10.7% compared to home prices in September 2021. These fluctuations are expected, especially with the volatility of the market and the interest rates changing at a rapid pace.
On the other hand, the price of condos and townhouses stood at $270,000. This data is up 1.7% from August 2022 and increased by as much as 17.4% from the same time last year. The increase in value of condos and townhouses poses another challenge to the Las Vegas real estate market since many of those who had been pushed out of the single-family homes market often turn to condo units as an affordable alternative. As these units’ prices go up, too, affordability will continue to become an issue in the market.
The number of units sold in September brings more interesting insights into the Las Vegas real estate market. For single-family homes, there were 2,030 units sold, which increased by 1.4% from August. The increase in sold units was due to the slight reprieve in interest rates during the start of the month, which meant single-family unit buyers pushed through with their pending sales. Another theory to the increased units sold is that buyers are finally realizing that the current interest rate standards will be the norm in the market, which meant waiting longer will only subject them to higher interest rates.
However, the slim increase in single-family home units sold this September is still a huge drop from last year’s number (down by up to 36.7% on a year-on-year comparison). It’s no surprise that there were fewer luxury home sales over this same period.
In terms of the units sold for condos and townhouses, it was down 14.2% from the previous month (and down 39.7% from the same time last year). The drop in new listings and the increased median price might have contributed to this, or interest rate hikes could also plague this segment of the market.
The inventory in the Las Vegas real estate market has finally stabilized. Albeit small, there was a slight increase in inventory this past month. A more stabilized inventory is a good sign for home pricing because it means the latter will also be stabilized.
The new listings for single-family homes stood at 3,378. This number is down 15.8% from the previous month and down 8.5% from the previous year. This trend has been ongoing for the last three months with fewer listings coming into the market from the previous month. The current inventory means there are up to 4 months of availability in the market. The available units dropped 0.9% from last month and about 57% of the units were sold in 30 days or less.
For the condo and townhouse units, there were 754 new listings in September. The new listings suffered a 23% decline from the previous month. Currently, the total available units are at 2,503, which is down 0.6% from the previous month (and up 39% from last year). Approximately 65% of the condos and townhouse units were sold in 30 days or less.
Mortgage interest rates are at the highest they’ve been in years – and that’s not expected to drop anytime soon. With increasing interest rates, we anticipate a decrease in demand for real estate. The higher the rates, the fewer people will be vying for a property. When fewer bidding wars are going on, this could hopefully soften the prices.
As we always say, there is no way to predict which direction the Las Vegas real estate market will go in the next month or few months. The best example of this is how the interest rate increased an entire point at the end of September (compared to early September rates). With pending sales down, expect that closings will also drop in the coming month.
That’s why you need to stay tuned to our market updates as we break down the numbers for you and provide insights that will (hopefully) make you feel more confident about your real estate market decisions.
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