Las Vegas-area home sales fell below a year earlier for the sixth consecutive month in November as a big jump in sales between $200,000 and $500,000 couldn’t compensate for a decline in sub-$200,000 transactions. The market’s rebalancing, including more move-up buying and fewer foreclosure resales, helped the median sale price rise year-over-year for the eighth consecutive month, a real estate information service reported.
In November, 4,118 new and resale houses and condos closed escrow in the Las Vegas-Paradise metro area (Clark County). That was down 9.9 percent from the month before and down 7.7 percent from a year earlier, according to San Diego-based DataQuick. The firm tracks real estate trends nationally via public property records.
The region's sales typically fall between October and November, with that decline averaging 4.2 percent since 1994, when DataQuick’s complete Las Vegas area statistics begin.
This November's total sales were 5.6 percent below the average number of homes sold during all months of November since 1994. However, if newly built homes are excluded, sales were above average. Resales of houses and condos combined were 22.5 percent higher than average for the month of November, while sales of newly built homes were 54.1 percent below average for the month. Although new-home sales remain low in an historical context, they’ve been rising this year, increasing 49.2 percent in November compared with a year earlier. Last month’s new-home sales were the highest for a November in five years.
In the overall market in November, sales of mid- to high-cost homes continued to shoot up compared with year-ago levels, while the number of low-end deals dropped sharply.
Sales of homes priced below $100,000 fell 38.1 percent in November compared with a year earlier. Transactions below $200,000 declined 20.0 percent year-over-year. November sales of homes priced from $200,000 to $500,000 – a range that would include many move-up purchases – rose 50.6 percent from a year earlier, while sales over $500,000 rose 54.7 percent. (Sales from $200,000 to $500,000 accounted for 25.5 percent of all activity in November, while the $500,000-plus market made up about 2.4 percent of all sales).
The median price paid for all new and resale houses and condos sold in the Las Vegas metro area in November was $143,000, which is the highest since the median was $144,900 in March 2009. The November median was up 4.4 percent from October and up 24.3 percent from a year earlier. Last month’s annual increase follows year-over-year gains of 19.2 percent in October, 19.1 percent in September, 18.2 percent in August, 12.1 percent in July, 8.7 percent in June, 4.3 percent in May, and 1.7 percent in April. Prior to April this year, the Las Vegas region median price fell year-over-year for 18 consecutive months.
The recent sharp gains in the median sale price reflect price appreciation triggered by strong demand meeting a relatively low supply of homes for sale, as well as a change in the market mix: Fewer of the homes re-selling are foreclosed properties, and more are mid-to high-end homes. Included in the latter is the increase in sales of newly built homes, which on average are more expensive than resale homes. In November, new homes accounted for 17.8 percent of total sales, up from 11.0 percent a year earlier.
The November median sale price was 54.2 percent below the median’s November 2006 peak of $312,000. The median has been rising off a cyclical low point of $110,000 in January this year, which was the lowest level since the median was also $110,000 in April 1994.
An alternative home-price gauge – the median paid per square foot for resale single-family detached houses – rose to $76 in November. That was up 1.3 percent from October and up 15.2 percent from a year earlier, marking the sixth consecutive month with a year-over-year gain. (This January’s $64 median per square foot was the lowest since at least 1994.) The November figure was 60.0 percent lower than the peak $190 paid per square foot in May and June 2006.
Foreclosure resales continued their downward trend in November, while short sales made up a substantially higher share of the resale market compared with a year earlier.
Foreclosure resales – homes that had been foreclosed on in the prior 12 months – accounted for 15.0 percent of Las Vegas resale activity in November – the lowest level since August 2007, when it was 14.6 percent. November's figure was down from 16.7 percent the month before and 52.4 percent a year earlier. Foreclosure resales peaked at 73.7 percent of the resale market in April 2009.
Short sales – transactions where the sale price fell short of what was owed on the property – accounted for an estimated 41.5 percent of the Las Vegas-area resale market in November. That compares with an estimated 43.3 percent the prior month and 26.9 percent a year earlier. The estimated short sale level has exceeded the foreclosure resale level for the past six months.
In the wake of an October 2011 Nevada law that created additional requirements for lenders trying to foreclose on properties, the number of notices of default (“NODs”) filed in Clark County plummeted. However, over the past two months NODs have trended higher compared with a year earlier. In November, lenders filed NODs on 1,620 single-family houses and condo units, down 16.6 percent from the prior month and up 26.5 percent from a year earlier. Between January and November this year, lenders filed 15,905 NODs, down 63.0 percent from the same period last year. The notice of default is the first step in the formal foreclosure process.
Last month lenders foreclosed on 633 single-family homes and condo units in the Las Vegas region, down 40.4 percent from the month before and down 67.2 percent from a year earlier. Between January and November this year, lenders foreclosed on 12,384 homes, down 60.0 percent from the same period last year.
Many of these distressed homes are purchased by investors, who continue to account for a near-record share of all sales.
Absentee buyers – mainly investors and vacation-home buyers – purchased 49.3 percent of all homes sold in the Las Vegas area in November. That was down from 50.2 percent the month before and up from 46.1 percent a year earlier. The peak was 51.2 percent this March. Absentee buyers paid a median $116,000 in November, up from $114,000 the prior month and up 28.9 percent from $90,000 a year earlier. Absentee buyers are those who indicated at the time of sale that the property tax bill will go to a different address.
Cash buyers purchased 50.6 percent of the Las Vegas-area homes that sold in November. That was down from a cash-buyer share of 52.5 percent of total sales the month before and up from 48.9 percent a year earlier. The peak was 56.7 percent in February 2011. Cash purchases are where there is no sign of a corresponding purchase mortgage in the public record. Cash buyers paid a median $111,294 in November, up from $109,950 the prior month and up 35.7 percent from $82,000 a year earlier.
Home flipping has been on the rise in recent months and has reached the highest levels since the housing boom. In November, 7.3 percent of all homes sold on the open market had previously sold within a six-month period. That's up from a flipping rate of 6.6 percent the month before and 3.4 percent a year earlier. Last month’s figure is the highest since the flipping rate was 7.8 percent in November 2004.
Meanwhile, a form of low-down-payment financing that’s popular with first-time home buyers – government-insured FHA loans – accounted for 36.4 percent of all home purchase loans in November. That was up from 36.1 percent the prior month and down from 39.4 percent a year earlier. In recent months the FHA share has hovered a bit above or below 35 percent of purchase loans – the lowest level since early 2008. The current housing cycle’s peak for FHA use was 55.1 percent of all purchase loans in September 2008.
Las Vegas-Paradise, NV
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Media calls: Andrew LePage (916) 456-7157
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