Las Vegas Housing Market Report First-Half 2024

The Las Vegas housing market continues to face familiar challenges from the pandemic era: high prices due to high demand and low inventory.

Furthermore, the economy experienced the highest inflation in over 40 years in June 2022, leading to an increase in interest rates. This increase has impacted mortgage rates, making it difficult for most families to afford homes. Despite these difficulties, some individuals are finding opportunities in the housing market. After two challenging years, many are wondering if there will be any changes in the second half of the year or even a potential housing market crash.

I will present you with the data and its meaning so you can better understand what is happening in our local real estate market, whether you are selling, buying, or investing.  

Single Family Homes

Sold Median Price

The median selling price for a single home sold has grown by six months since January 2024, reaching $475,000. It increased by 0.42% from May 2024, showing a diminishing growth pace compared with the 1.09% from January to February 2024. 

The sold median price of $475,000 is just $7,000 shy of the highest price ever registered in Southern Nevada, $482,000 in May 2022, and is 10.5% higher than the nationwide median price for June 2024  reported by the NAR, National Association of Realtors, which is $429,900.

Units Sold

Total units sold, had reported a continuous growth from January to May. Las Vegas housing demand decreased, less homeowners, for the first time in June 2024. The reduction is 12.8%. from May 2024

New Listings

The number of single homes hitting the market in June decreased 9.4% from May. It is the first fall since the beginning of the year.

Units Available

This indicator has been growing steadily since April this year, but at a slow pace: 6.3% compared to 11.3% from April and May 2024.

Effective Availability

It shows how long the supply lasts in months, assuming no more properties are listed. The year starts with a 2.4-month supply. It varies monthly, decreasing to a lower indicator of 1.0 months supply in April 2024 and growing again to 2.0 months in June 2024.

Speed of Sales 

In terms of percentage, this indicator shows the portion of total sales that occurred within 30 days on the market. For June, this figure was an astonishing 71.6%.

Condos/Townhomes

Sold Median Price

The median sold price for the niche of Condos/Townhomes presents an irregular behavior compared with the median sale price for single homes. It arrived at $295,000 in May, which repeat in June 2024. This median price is the highest ever registered, over $10,000 from the peak in May 2022, $285,000. This impressive growth is because many people who cannot get out of the single homes market are looking for cheaper options like condos and Townhomes.

Units Sold

In this niche, we have similar behavior reported for single homes:

• Continuous growth from January to May.
• Less homeowners on June 2024. Demand decreased for the first time in June 2024 from 690 to 605 units sold.
• A 12.3% reduction.

New Listings

Fewer condos and townhomes hit the Market in June 2024, dropping 8.7% from May 2024. It is the only fall since January 2024.

Units Available

The total inventory grew continuously from January to June 2024, rising 3.2% from May to June 2024.

Effective Availability

The effective availability for this niche started with 2.4 months’ supply and ended with 2.3 months’ supply in June 2024.

Speed of Sales 

The total sales pertain to listings on the market for 30 or fewer days, ending in June 2024 at 61.5% compared to 55.9% for January 2024.

keynotes for both niches

• Even though the number of units sold in June 2024 fell, and the total number of units available grew every month, the changes in these two variables were so small that they did not affect the median price’s continued rise. 
• The effective availability of 2.0 months for single homes and 2.3 months for condos/townhomes means supply still needs to be higher to consider a market shift. When this indicator starts moving toward 3.0 months, it could hint at a change in the housing market from a seller’s market to a more balanced real estate market.

How define the Las Vegas real estate market?

High median prices, effective availability in a low range, and a high speed of sales confirm that the Las Vegas housing market is, without a doubt, a solid SELLER’s MARKET.  

Characteristics of a Seller’s Market

• High Prices (High demand + Low inventory)
• Housing Supply up to 3.0 months
• Sales happen faster. 

How much has the median sold price increased from January to June 2024?

From January to June 2024, the sold housing median price shows a growth of 4,4% for single homes and a higher growth for the niche of Condos/Townhomes,  7.3%.  Due to the affordability issues that define the current Las Vegas housing market, high prices, and high interest rates, few families can not access the American dream of homeownership in the most popular niche, single-family homes, so they opt for more affordable options in the niche of condos/townhomes.     

How home Buyers Financed Their Purchases?

Cash and conventional loans account for 72.9% of the total number of single-family homes sold. 18.1% of homebuyers financed their purchases with FHA loans, and 7.6% with VA loans. Remember that, traditionally, FHA loans are the preferred mortgage loan for first-time buyers.

In Condos/Townhomes, the percentage of homebuyers using cash and conventional loans to fund their purchases is higher than in the niche of single homes, arriving at 80.0% combined. Also, there was a reduction in the percentage of properties financed with FHA to buy start homes, 13.4%, and VA loans, 4.6%. 

Mortgage Interest rates

Mortgage Interest rates for 30-year-fixed mortgage loans were around 7% during the first half of the year, substantially increasing home-buying costs, and making it even harder for more families to access homeownership.

New Construction Project

New construction projects are popping up all around the Las Vegas Valley. Builders are doing their job, but unfortunately, it doesn’t alleviate the structural housing deficit the region has been experiencing for years. Additionally, the prices of the new projects need to be within reach for most people.

Is the Las Vegas Housing market going to crash?

The Las Vegas area Market will not crash as many suggest. The following are some of the factors that support this point:

• The demand is too strong, and inventory is still so low. 
• The residential lending industry learned lessons from the 2008 crisis, and lending practices have been very stringent.  
• As in any cycle of any housing market, there are foreclosures, but they are not significant enough to become a predictor of a housing crash.
• The unemployment rate for the Las Vegas area rose to 6.2% in June 2024.  Although a low unemployment rate is preferable, paradoxically, right now it is a positive indicator. It shows that the economy is responding to restrictive monetary policies to control inflation and is cooling down.
• A cooling economy means that the Federal Reserve can be sure to reach its goal of controlling inflation by around  2% annually. In June, inflation arrived at 3% annually. Consequently, it is very probable that in the Federal Reserve’s next meeting in September 2024, they will decide to cut the short-term loan interest rates among banks, marking the beginning of a new cycle for the housing market. 

What can you expect in the second half of the year?

The Federal Reserve has indicated the intention to cut interest rates during the second half of the year. It seems that now are more clear signs that the economy is cooling off enough for the Federal Reserve to cut the interbank rate.

It will likely happen in September 2024 and indirectly benefit the housing market, as mortgage bankers will also cut mortgage interest rates. 

Now is a time to think positively, prepare, and plan for the new season to start soon. Arriving at a more balanced real estate market will take time. Interest rates will stay relatively high for some time, and building enough housing inventory will take years. 

But for sure, the second half of the year could be remembered as the beginning of the end of more than two years that have been difficult for most people due to higher housing prices and mortgage interest rates, which have severely impacted the real estate market.

Do you have questions about buying or selling in Vegas? Drop them in the comments below, and let’s chat!

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