The Las Vegas market is cooling off
In 2004-2005 Las Vegas was one of the hottest real estate and investing markets in the country. House values were appreciating through the roof and homes that were for sale were getting multiple offers that were higher than the asking price.
Things have changed. We are now in more of a buyers market that has people speculating that the bubble has burst. Homes are on the market for an average of 59 days and are selling at around 97% of the listed price. There are houses listed on the MLS that have been on there since December and earlier and have gone through a few price reductions. Homebuilders are starting to offer more and more incentives to entice future home owners to buy a house from them.
Has the bubble burst?
This depends on who you ask and what their motives are. In my opinion, no. The Vegas market is correcting itself from the crazy explosion that it had and interest rates are on the climb, which tends to slow down appreciation everywhere. We are getting back to normal. I would not expect to see double digit appreciation anytime in the near future, but we are starting to see a shortage of buildable land. This is causing builders to cram houses together, raise prices and start building up. I believe that this will help single family homes with yards, continue to appreciate at normal 4-5% rates.
The Las Vegas market has received some bad press lately because of the slowdown. Some people are running and some will take advantage of it. The median house price in Las Vegas has dropped down closer to $300k. This is good for buyers, but may be bad for sellers. There are most likely some homeowners that have their houses over financed with helocs and second mortgages.