Home sales in Las Vegas reached the second lowest level this decade for the month of May. The number of transactions, as well as the median sales price, dipped from the previous period last year. Most of the decline can be attributed to the expiration of the federal tax credit for homebuyers, along with a slowdown in the number of homes entering foreclosure. See the following article from DQNews for more on this.
Las Vegas region home sales in May dropped below the year-ago level for the first time in 21 months as fewer foreclosed properties sold and the impact of the federal tax credit began to fade. The median price paid for a home in May barely budged compared with April and it fell slightly from a year earlier, a real estate information service reported.
Foreclosure resales – homes that had been foreclosed on in the prior 12 months – fell to 49.5 percent of all resales in May, down from 51.9 percent in April and down from a record-high 73.7 percent in April 2009, according to MDA DataQuick of San Diego. The firm tracks real estate trends nationally via public property records.
Foreclosure resales have declined each month since last year’s peak. Last month’s figure was the lowest since foreclosure resales were 48.1 percent of the resale market in March 2008.
A total of 4,386 new and resale houses and condos closed escrow in the Las Vegas-Paradise metro area (Clark County) last month, down 1.7 percent from April and down 3.3 percent from a year earlier. On average, sales have increased 5.0 percent between April and May since 1994, when DataQuick’s complete Las Vegas region statistics begin.
May’s sales total was the second-lowest for that month – behind May 2008 – in a decade, and it was 9.7 percent lower than the average May sales tally back to 1994.
Last month’s sales of homes priced below $200,000 increased slightly to 77.2 percent of all transactions, up from 76.5 percent in April and up from 74.9 percent in May 2009. Sales above $500,000 also rose a tad last month to 2.5 percent of all transactions, up from 1.9 percent in April and 1.7 percent in May 2009.
The number of houses and condos that resold (meaning no newly built homes) in May fell to 3,859, down 3.1 percent from April and down 7.5 percent from a year earlier. Until April, resales had risen on a year-over-year basis for 23 straight months.
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Sales of all newly built houses and condos totaled 527 in May, up 9.8 percent from April and up 44.4 percent from a year earlier. However, it was still the second-slowest May, behind last year, for new-home sales since at least 1994.
The median price paid for all new and resale houses and condos sold in the Las Vegas metro area in May was $134,000, virtually unchanged from $133,955 in April and down 0.7 percent from $135,000 a year earlier. In April, the median had risen above the year-ago level by 0.7 percent, marking the first annual gain since February 2007.
Last month’s median was 57.1 percent below the peak $312,000 median in November 2006.
The median price paid for resale single-family detached houses – by far the region’s largest home-type category – was $137,500, down 1.8 percent from $140,000 in April and down the same amount from $140,000 a year earlier. The May resale house median was 56.0 percent lower than the peak $312,250 resale house median in June 2006.
The median price paid last month for resale condos was $72,000, down from $75,000 in April but up 5.9 percent from $68,000 a year earlier, marking the second consecutive annual gain for existing condos in three years. The resale condo median has been hovering a bit above or below $70,000 each month over the last year. May’s resale condo median stood 64.5 percent below its $203,000 peak in July 2006.
An alternative price gauge – the median paid per square foot for resale single-family detached houses – slipped in May to $77, down from $78 in April but the same as a year earlier. Last month marked the second month in a row in which that price measure didn’t fall year-over-year. Prior to this April, the median paid per square foot had fallen year-over-year during each month since late 2006. May’s figure was 59.5 percent below the June 2006 peak of $190 per square foot.
Meantime, foreclosures eased last month from April’s level but rose year-over-year. In May, 2,701 single-family house and condo units were foreclosed on in the Las Vegas region, down 17.2 percent from April but up 16.0 percent from a year ago. The peak month was February 2009, when 3,718 homes were foreclosed on. The figures are based on the number of Trustees Deeds filed at the Clark County recorder’s office.
In the first five months of this year, 11,576 Las Vegas region houses and condo units were foreclosed on, down 10.1 percent from the same five-month period last year.
The foreclosure totals can include units that the county assessor has designated condos, but are currently used as apartments (e.g. a 100-unit complex designated as condos but used as apartments could be foreclosed on and those units would be reflected in the foreclosure total for that month). For this reason and others, the number of foreclosure filings has seesawed, and a single month’s increase or decline doesn’t necessarily indicate a new trend.
The dwindling number of foreclosed properties re-selling over the past year has created more competition between first-time buyers and investors, who still represent a huge portion of the market.
In May, a popular form of financing for first-time home buyers – government-insured FHA loans – accounted for 51.7 percent of all home purchase loans. That was up from 49.8 percent in April but down slightly from 52.4 percent a year earlier.
Absentee buyers purchased 40.9 percent of all Las Vegas–area homes sold in May, paying a median $110,000, which was down from a median of $117,000 in April but up from $98,790 a year earlier. Absentee buyers bought 42.0 percent of the homes sold in April and 36.1 percent in May 2009. Absentee buyers are often investors, but can include second-home buyers and others who, for various reasons, indicate at the time of sale that the property tax bill will go to a different address.
Buyers who appear to have used cash to purchase their homes accounted for 46.7 percent of all May sales, down from 48.0 percent in April but up from 42.0 percent a year earlier, based on an analysis of public property records. The median price paid in these seemingly all-cash deals in May was $105,000, down from $112,000 in April but up from $89,250 a year ago.
Specifically, these all-cash deals were transactions where there was no indication of a purchase mortgage recorded at the time of sale. Some of these “cash” buyers could have used alternative financing arrangements outside of a typical, recorded purchase mortgage, and in some cases they might be taking out mortgages after their purchases. All-cash deals have become popular in many Western markets where prices have dropped sharply, luring investor buyers who can’t always qualify for traditional mortgages. Moreover, sellers favor the relative speed and certainty of all-cash transactions.
This article has been republished from DQNews. You can also view this article at DQNews, a real estate research and news site.