The Pahrump and Las Vegas housing markets increased again to record levels for median home prices in July with demand still outpacing supply and affordability concerns for some on the horizon.
The median home price for existing homes in July in Pahrump for a single-family home was $345,000—an all-time high for the valley, and a $10,000 jump from June’s record $335,000 median price, according to data from the Las Vegas Realtors’ multiple listing service. For Southern Nevada, the median price for homes also hit its own milestone, reaching $405,000.
According to LVR President Aldo Martinez, “The median affordable price for Southern Nevadans may soon be out of reach.”
Martinez says, “As we’ve been saying for months, housing prices are rising faster than incomes here in Southern Nevada, and that seems unsustainable over the long term. Even with mortgage interest rates near all-time lows, we know it’s getting difficult for first-time buyers and working-class families to afford a home.”
Many buyers are turning to condominiums and townhomes, and some “will have to revert to renting because they’re no longer able to purchase at these prices,” Martinez said.
According to Martinez, the low supply of homes available for sale is continuing to push prices up, which presents a problem for potential buyers. At the same time, it’s presenting a rare opportunity for sellers.
Matrinez said, “This has become evident as we continue to see more homes come to market than we have in the past 10 years. July will make the fifth consecutive month where the inventory of homes going to market will surpass the previous month, with 4,077 new listings having gone to market.”
LVR reports that at the end of July, there were 3,007 single-family homes listed for sale in July without any sort of offer. That total is down 37.4% from the same time in 2020, but Martinez notes that this is the fifth consecutive month that the total has increased.
Martinez sees this as “indicators of the market fighting with all its might to normalize, but consumer consumption continues to remain strong.”
By the numbers
In July, 4.225 existing local homes, condos and townhomes were sold in Southern Nevada. This is an increase of 0.8% for homes over the same time in 2020 and an increase of 24.7% for townhomes and condos. The Southern Nevada market is on pace in 2021 to surpass the last post-recession high of 38,153 homes sold, according to a release from LVR.
An all-time high for Pahrump was set back in April when the median home price for the valley hit $325,000. July’s numbers broke through this record and increased it by over 6%, according to data from LVR.
Pahrump saw an increase of over 30% over the same time a year ago in July 2020, when the median home price was $265,000.
For Southern Nevada, median home prices saw an increase of 22.7% in July over the same time a year ago when the median home price sat at $330,000, now at $405,000. This is the first time that Southern Nevada has crossed the $400,000 mark.
The all-time record was cracked for Southern Nevada’s housing market in February 2020 when it reached $316,000; the previous record was set in June 2006 at $315,000.
The heated housing market in Las Vegas has also seen other phenomenons as well. Martinez notes a major rise in the luxury market that has historically seen about 300-400 luxury units sold over $1 million each year. For 2021 so far, 961 units have sold in this price bracket, with 928 of them single-family homes.
If the pace continues, 1,500 units would be sold by the end of 2021, a record. The median price of homes selling over $1 million is $1.45 million, with the highest sale this year at $25 million in Las Vegas.
The Southern Nevada housing market has been on a steady rebound since it bottomed out at $118,000 median home price in January 2012.
According to Martinez, since the start of the pandemic in the first part of 2020, the local housing market has been more in line with the national trends, which includes a shortage of homes available for sale, strong demand and historically low mortgage rates that have led to the record home prices.
Other factors are also compounding the market trends, where Martinez said that builders are not constructing enough homes to meet demand and homeowners are staying in their homes longer and are slower to move than they have historically in past years.
Martinez is urging buyers to be patient and persistent when seeking a home with more homes being listed for sale lately. Many homes attract multiple offers, and bidding wars are common, Martinez said that many go back on the market and “are then awarded to the next buyer in line.”
The number of cash buyers in the Southern Nevada housing market hit 31.7% in July, an increase from one year earlier when the number of cash buyers was 16.8%. But it’s still far below the 59.5% when the number of cash buyers peaked in March 2013 following the Great Recession.
With a ban on evictions and foreclosures, historically low levels of so-called distressed sales have been seen, according to LVR. The number of short sales and foreclosures in July for Southern Nevada was 0.3%. This compares to 1.2% in July 2020; 2% in July 2019; 2.9% in 2018; and 6.4% in 2017.
LVR’s statistics only include existing properties that were sold through its multiple listing service. This data does not necessarily include newly constructed homes sold by local builders or homes for sale by owner.
Contact Editor Jeffrey Meehan at firstname.lastname@example.org