Las Vegas Sun NewsLas Vegas new home sales hit 30-year low in 2011
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Model homes are shown under construction at a residential development site near Horizon Ridge Parkway and Gibson Road in Henderson Wednesday, June 1, 2011. The defunct Vantage Lofts project is in the background.
Monday
16 January 2012
2:42 p.m.
Vegas Inc. coverage
The Las Vegas-area home-building industry likely bottomed out in 2011, when new home sales fell to a 30-year low of 3,894, an analyst says.
“2011 was the most difficult year the home building industry has ever been through,” Dennis Smith, president of Home Builders Research Inc., said in his monthly “Las Vegas Housing Market Letter” issued over the weekend.
Smith’s year-end tally of 3,894 sales locally compared to sales of 5,379 in 2010 and of 38,957 at the peak of the market in 2005.
Smith said the 3,894 sales is the lowest he’s seen since he started tracking the market in 1987.
VEGAS INC research shows the 3,894 sales was the worst showing locally since 3,576 single-family building permits were issued in 1982, when the nation was mired in recession and the Las Vegas market was much smaller.
Clark County’s population was 507,510 people in 1982. By 2010, it had risen to 1.97 million people.
During the current recession, Las Vegas new home sales have tumbled because of high unemployment, which is now at 12.5 percent, and lower prices driven by competition with foreclosed homes.
New homes sold locally in December at a median price of $212,250, down 2.7 percent from December 2010, Smith reported.
More than half of Las Vegas homeowners remain underwater in their mortgages — they owe more than the properties are worth — and are therefore unable to buy new homes, Smith noted.
With modest local economic improvements expected, Smith said, he expects new home sales locally to rise slightly but to remain well below historical levels. They should come in at about 4,000 this year and at about 4,200 in 2013, he said.
“So, the bottom of this mess certainly seems behind us. But, any quick, dramatic recovery appears to be out of the question,” he wrote in his new market update.
Smith’s report follows last week’s issuance of reports on existing home sales showing that while they soared during 2011 in Las Vegas, prices fell year-over-year in December by 9.1 percent to a median of $120,000.
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Based on this, how can town government go and approve more building of homes? The town is saturated with homes, but yet they keep building? Building for whom?
@dipstick
Why?...to avoid:
Being jerked around by a bank who owns the property. Offer one price, they leave you waiting for 4 months. Then they say ok. Then they say not ok, another offer pending. Then they say house off the market until further notice. Then back for sale. Then the other lien holders step in and halt the process of sale. Then they finally agree on price. Now you are 9 months into this ordeal. Now you have to have it inspected and more than likely it's got damage from a pissed off homeowner that was foreclosed on. The problem is some have become sneaky and have done things to the house that an inspection can't pick up. I've discovered that if it's a nice new neighborhood, new house...it's worth the extra money to avoid the bull**** headaches of buying a foreclosed or short sale house. Have you seen what some of these idiot homeowners do to their homes to personalize them? Wall paper in psychedelic pink. Orange carpet. Walls painted ungodly bad colors. And on and on. Buy new, it's worth the extra dough.
"Why?...to avoid: . . . . . it's worth the extra money to avoid the bull**** headaches of buying a foreclosed or short sale house."
TomD -- you're catching on, only you left out one critical factor. A few weeks ago the Sun reported how our AG is in the process of prosecuting some of those responsible for filing "tens of thousands" of fraudulent foreclosure docs with our County Recorder. Our Supreme Court has said essentially that voids the recorded instruments, which means the foreclosures are voidable.
Imagine someone knocking on your door with a court order in hand voiding their foreclosure and he wants his house back NOW. It's happening in at least Massachusetts since last year's Ibanez decision.
"If you're going to take my house away from me, you better own the note." -- Joe Lents (who hasn't made a payment on his $1.5 million mortgage since 2002) in Bloomberg's 2/22/08 "Banks Lose to Deadbeat Homeowners as Loans Sold in Bonds Vanish"
Just don't get all the "haters". How would it be better for me to rent for $1200(which is the going rate on my street), instead of paying my $800 a month for mortgage, taxes, insurance? I can take $400 a month and put it towards updating and repairing the house, so that's almost $5000 a year..and that's if I choose to. In 20 years it'll be MINE, but if I rent I'm just wasting $1200. If you have money and a fairly secure job, then HECK YEAH, now is the time to buy...so what if prices go down for the next 2-3 years, I'm not going anywhere and I continue to save almost $5000 a year compared to renting.
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I wish the article would mention how many building permits have been issued and what the 6 month running rate is. This might provide some forecast to what 2012 will bring. I'm not sure anyone is going to buy into the line that 2011 was the worst and we've turned the corner on new home construction.
Cycles, cycles, cycles. One is ending and another is beginning. Now is a great time to buy. Or, now is a great time to rent. Examine your needs and resources and proceed accordingly. Simple, really.