Why There Won’t Be A Housing Market Crash
Prices have increased at an alarming pace, over 33% in the past year in Las Vegas. Why There Won’t Be A Housing Market Crash The real estate market has been on a wild ride the last couple of years. While casual real estate observers have been calling this surge in prices a bubble on the verge of bursting, there’s no factual data to back that up. Let’s look at why we will not be seeing a housing market crash anytime soon. What’s Causing Las Vegas Home Values To Increase? The first thing we need to look at is why home values are increasing. Nationwide, the cause is a lack of real estate inventory. That’s a huge reason here in Las Vegas as well. At the time of writing, there were only 3,142 homes listed for sale, which is even lower than it was at this time last year. When homes go on the market, they receive multiple offers, many cash, which drive up the prices. We have out-of-state buyers, investors, and those looking to purchase with the intention of using the home as a short-term vacation rental, driving prices up on our limited inventory. Another issue affecting inventory is that housing construction came close to a complete halt after the crash in 2007 and has never picked up to the level needed to have a balanced housing market. 1 million new homes are expected to be built nationwide this year, but that is still not nearly enough to satisfy demand. The National Association of Realtors estimates that we need 4 million homes to be built to see a balanced market. Tighter Lending Requirements Will Help The Situation We need to remember that we are not seeing history repeat itself. One of the biggest reasons for the housing crash in 2007 was the extremely relaxed lending requirements. People were borrowing far more than they could afford since lenders did not verify income. Borrowers also entered into adjustable-rate mortgages (ARM), which meant that a borrower’s monthly payment could increase based on the market interest rates. Rates increased, causing monthly payments to increase to unaffordable levels, and borrowers defaulted on their loans, spiraling into foreclosure, and eventually, the bubble burst. Lending practices today are much more strict. In 2020 the typical credit score for mortgage borrowers was at a record high of 786, showing that borrowers should also be much more stable than in years past. No Need To Panic Experts say we should not panic since the cause of today’s wild price appreciations is completely different from what we saw with previous housing crashes, experts say we should not panic. Yes, housing values will likely come down a bit, but that’s to be expected. The real estate market is cyclical, and a small dip in prices is not cause for concern. Bottom line, if you are able to purchase a home in today’s market, you should. We anticipate more price increases, especially in the long term. If you have questions or would like an experienced real estate agent in the Las Vegas area to help you with the home buying process, give the Villa Group a call!
Inventory Starting To Rise
The story for the last few years in Las Vegas has been low inventory, causing home values to explode. Inventory Starting To Rise Each month, we would see inventory dip lower and lower, causing frustrating bidding wars and home buyers who were starting to doubt that they would ever get into a home. Is that beginning to change? Some Relief For Homebuyers We are finally starting to see inventory rise. It isn’t rising by much, but it is at least moving in the right direction. In April, the inventory of single-family homes and condos rose about 22% over the previous month. It was also up 33% from April 2021. This is excellent news for homebuyers who had to jump at any home that hit the market since there wasn’t any other option. Unfortunately, the increase in inventory is not yet translating into a decrease in price. Homes are taking longer to sell, which is good news, and buyers can have a little bit of breathing room when it comes to negotiations. You’ll still need to come in with a very strong offer, close to or over the asking price in most instances, but you might not have to waive contingencies like we saw buyers having to do last year. New Builds Are Helping Construction on new homes has increased, which gives home buyers another option when it comes to buying a home. Builders are swooping in and buying land, which will help alleviate Las Vegas’ inventory shortage. Homebuilders Lennar and Taylor Morrison have huge plans for home building in and around Las Vegas. They both plan to start construction on new projects by the end of 2022 or early 2023, with a target completion date of winter 2023. It’s Still a Good Time To Sell Even though inventory is rising and homes are not flying off the market as quickly as they were a few months ago, it’s still a really good time to sell your Las Vegas home. Home values have continued to increase, and buyers are out in full force. We don’t know exactly what the market will be a year from now, but we do know that we are in the midst of one of the most amazing markets for sellers. Don’t wait too much longer if you own an investment property or are thinking about selling your current home to either upgrade or downsize. You’ll get a significant return on your investment, and we would hate for you to miss out on that. Give The Villa Group a Call! The Villa Group is here for all of your Las Vegas real estate needs. Whether you are hoping to cash in by selling your home or are willing to take on the buying process, we are here for you. Give us a call to discuss your real estate goals.
New Housing Developments Going Up In Las Vegas
Las Vegas is growing at a really fast pace. New Housing Developments Going Up In Las Vegas You’ve probably noticed quite a few new housing developments popping up if you’ve driven around the city lately. Buyers are coming from more expensive places like California, and even Arizona are moving to the Las Vegas area in record numbers, which means new construction is crucial. Let’s look at some of Las Vegas’ new housing developments being built in and around the city. Lake Las Vegas Homebuilders Richmond American, Lennar, Del Webb, and Blue Heron are hard at work creating a new luxury real estate development. The community is centered around a 320-acre man-made lake which allows for plenty of fun for the whole family. Homebuilder Taylor Morrison has just finalized plans to build three more communities; Portofino, Marbella, and Verona. While not all the plans are available, we do know that Portofino will have 274 lots with single-family homes ranging in size from 1800 square feet up to 3500 square feet. We expect these homes to start in the high $500,000 range. The homes will have views of Lake Las Vegas and be built with luxury in mind. The Verona community will be more modestly priced, starting in the mid $400,000s. These homes will have two stories and range in size from 1,800-to 2,500 square feet. We expect sales to begin in early 2023. Valley Vista Valley Vista is one of Las Vegas’ top-selling communities. It is comprised of 21 communities over 2,600 acres. It is close to Aliante Casino, as well as plenty of shopping and dining options. The most recent addition to the Valley Vista community is Galaxy Park. This community was built by D.R. Horton and spans 10 acres. The community has a disc-golf course, two dog parks, a pickleball court, and basketball courts. The homes in Galaxy Park start in the mid $400,000s. Homebuilder Lennar also has new communities slowly opening up in Valley Vista. They have 648 homesites and a wide price range starting at $338,000. Inspirada The growing Inspirada community focuses on outdoor spaces and a strong sense of community. Inspirada has farmers’ markets, yoga classes, and hosts a marathon that attracts residents and visitors alike. The community is located in Henderson, Nevada’s second-largest city. Inspirada has three builders who offer a total of 44-floor plans. Prices for the homes start in the $300,000s, which provides a more affordable option for homebuyers in Henderson. But don’t let the affordability fool you. These homes are created with sustainable home features and functional floor plans. Interested In A New Build Community? If you’d like more information about any of the new build communities in Las Vegas or Henderson, we would love to help! It’s always a good idea to have a licensed Realtor represent you when having a home built. Give the Villa Group a call, and we will help you find the new build community that best meets your needs.
Categories
Recent Posts
