New home sales in Las Vegas has reached its highest point since 2008. The increase is in annual sales, according to a report. Although there has been an increase since 2008, the sales have not gotten higher than they were in the last two decades. Not only this, but homebuilders used to be a lot busier in the Vegas valley. However, overall, 2016 was a much better year than many expected when it comes to the home-buying market in Vegas alone.
Las Vegas homebuilders booked an increase in annual sales in 2016 for the second consecutive year, reaching the highest tally since 2008, a new report shows.
But sales volume is still far below those of the boom years last decade and of the 1990s, before the bubble inflated — although prices are again flirting with peaks.
Builders closed 7,984 new-home sales in Clark County last year, up 16.7 percent from 2015, according to Las Vegas housing tracker Home Builders Research.
The median sales price of December’s closings was $337,060, up 8.4 percent from a year earlier. Builders also pulled 8,702 permits for new homes last year, up 15 percent from 2015.
Last year, the top builder in the Las Vegas area by sales was Fort Worth, Texas-based D.R. Horton, which booked 1,091 closings.
Between 1995 and 1999, annual new-home closings ranged from roughly 17,900 to 21,160. Sales peaked in 2005, during the real estate bubble, at almost 39,000, before plunging to a low of 3,900 in 2011, during the recession, according to Home Builders Research.
Overall, Las Vegas’ housing market has “a nice, steady momentum,” and the sales total in 2016 was “much better … than many expected a year ago.” But there are also “a lot of unknowns” that might alter the market and the broader economy “due to the perceived extreme vicissitudes that could be emanating” from President Donald Trump’s administration, Home Builders Research founder Dennis Smith wrote in the report.
Higher rates boost borrowing costs, potentially scaring off prospective buyers. Nationally, rates rose sharply after Trump won the election in November but have recently dipped.
The average rate for a 30-year mortgage was 4.09 percent in the week that ended Jan. 19, down from 4.2 percent in December. But rates are still up from November, when the average was 3.77 percent, and October, at 3.47 percent, according to mortgage giant Freddie Mac.
In Las Vegas, rates need to remain low before builders can get back to selling and starting 10,000 homes per year, Smith said. But that volume, he added, would still be about half of the “normal annual production level of the early 1990s.”
Sales prices, however, are almost back to record levels.
According to Home Builders Research, the peak median for new-home sales was reached in August 2007, at $338,560 — just $1,500 above December’s tally.