Las Vegas Real Estate Housing Update – March 2024

Las Vegas Real Estate Housing Update – March 2024

According to Zillow, the Las Vegas valley is projected to be the 12th hottest real estate market in 2024, and I wholeheartedly agree. Let’s delve into the current state of the Vegas real estate market.

In 2023, the real estate market experienced its worst performance since 2008. However, we are now witnessing a positive shift over the last 8 months. Looking at the lowest point of 2023 as it relates to closings between the months of July and November, the median sales price stood at $430,000, For the month of February 2024, the median sales price for a single-family home now stands at $439,000, reflecting a 2.2% increase compared to those those lowest months in 2023. This translates to an exciting trendin single-family home values over the past 8 months. If we compare the median sales price in January 2024 to the median sales price one year earlier of $455,000, we currently stand at -$3.64% decrease in median sales price over the last 12 months. We do have a little bit to go in terms of a recapture of value, but the trends are looking like they are in our favor.

The influx of California residents to the Las Vegas valley is not surprising, considering the disparity in median sales prices between the two regions. Moreover, the number of single-family homes sold in February indicates a significant 11.6% surge compared to February 2023, suggesting an end to the pent-up demand from buyers. The recent decrease in mortgage rates has been a driving factor behind this trend, with buyers capitalizing on the favorable conditions.

However, it’s important to bear in mind that buyer demand is closely tied to interest rates, and any further increase in demand hinges on the Federal Reserve’s decisions regarding the Federal Rate. While Federal rate cuts don’t directly impact mortgage rates, investor expectations of how these decisions will affect the economy can influence mortgage rates. 

Currently, the Federal Reserve is not indicating an imminent rate cut, and we have observed a slight increase in mortgage rates over the past few weeks. If this trend continues, it could impact the current home sale trends. However, once the Federal Reserve signals an impending rate cut, mortgage rates may gradually decline, leading to an increase in home sales throughout the Las Vegas valley.

Turning our attention to inventory, historically low availability of homes has resulted in a seller’s market that has strengthened over the last year. In February, there were an average of 4,631 single-family homes available for sale, marking a 34.5% decrease over the past 12 months. This significant decline further reinforces the strong seller’s market and dispels concerns of an imminent real estate crash in the Las Vegas housing market. In other words, the “sky is not falling.”

Now, let’s address the question of what sellers can expect if they decide to sell their home, and most importantly, what they will be purchasing. It’s crucial to have a clear idea of what you’re looking for before listing your home, especially considering the increasing number of offers being made on available properties. The return of “Multiple Offers” is a possibility, particularly due to the high volume of investor offers and purchases in the past six months. As a buyer, it’s essential to make a strong initial offer when you find a property of interest, as desirable properties can be snatched up within hours.

Another significant indicator of our vibrant market, often overlooked, is the activity of property showings. According to Showingtime, a platform that provides real-time showing data based on REALTOR® activity, the number of showings per available single-family listing has increased from an average of 2023 low of 1.9 showings in May 2023 to 2.7 showings in January 2024. This represents an approximate 42% surge in property showings since that lowest point of the previous year, further confirming the resurgence of buyers in the real estate market.

I understand that this information may seem overwhelming, especially when considering its impact on both home sellers and buyers. Some real estate economists anticipate further rate cuts in 2024, although the extent of these cuts remains uncertain. This determination depends heavily on key economic indicators that may show signs of inflation, recession, or other issues that can affect sustainable economic growth. With the current economic indicators being slightly positive, the Federal Reserve has indicated that consumers shouldn’t expect any cuts until at least the spring.

However, it is expected that mortgage rates will continue to decrease, making homeownership a reality for many who were hesitant due to higher mortgage rates.

Stay informed and seize the opportunities in this dynamic real estate market.