Las Vegas home sales down as prices continue to climb

Las Vegas’ housing market has been moving at a dizzying pace for the past year or so — rapid sales, fast-rising prices, multiple offers on homes, and so on.

But the main fuel for the frenzy here and elsewhere, cheap money, has slipped away.

The average rate on a 30-year home loan was 5.1 percent as of Thursday, up from 2.98 percent a year ago, mortgage-finance giant Freddie Mac reported.

House prices in Southern Nevada and across the country are still skyrocketing from year-ago levels, but as borrowing costs climb, buyer activity is down.

“The combination of swift home price growth and the fastest mortgage rate increase in over forty years is finally affecting purchase demand,” Freddie Mac chief economist Sam Khater said in a news release, adding price growth should soften “to a more sustainable pace later this year.”

Las Vegas’ housing boom is bound to end at some point, though it’s anyone’s guess when or how that will happen. Moreover, real estate markets are prone to ups and downs, especially in Southern Nevada.

As it stands, Las Vegas’ rapidly rising prices are still climbing faster than in other cities around the U.S., availability remains tight, and affordability concerns have not gone away.

But there are some signs that some people are again pulling back.

On the resale side, around 3,270 previously owned single-family homes traded hands in March, down about 12 percent from the same month last year, trade association Las Vegas Realtors reported.

On the new construction side, Southern Nevada builders logged nearly 1,260 net sales — new purchase contracts minus cancellations — in March, the highest monthly tally in a year, according to Las Vegas-based Home Builders Research.

But overall, builders reported almost 3,900 net sales this year through March, down 15 percent from the same three-month stretch in 2021, the firm indicated.

It also noted that new-home buyer traffic dropped 18 percent compared with such traffic a year earlier.

On top of all that, the overarching natural-resource issue in our ever-expanding, drought-stricken desert metropolis — water — made headlines again this week.

Workers with the Southern Nevada Water Authority took actions Wednesday to make its low-lake-level pumping station at Lake Mead fully operational.

The move came after the nation’s largest man-made reservoir dropped far enough to expose the top of its highest-level intake straw for the first time in its history, Review-Journal staff writer Colton Lochhead reported.

Still, Las Vegas’ housing market, in more than a few ways, keeps flooring it.

Resale prices have never been higher: The median sales price of previously owned single-family homes was a record $460,000 in March, up 26.7 percent from a year earlier, Las Vegas Realtors reported.

New-home prices have never been higher: The median closing price of newly built single-family houses was a record $483,000 in March, up 17.8 percent year over year, Home Builders Research reported.

Rents are soaring, too: The typical rental rate in the Las Vegas area was $1,828 in March, up 22.7 percent from a year earlier, Zillow reported.

So, when, and how, will all of this end?

Stay tuned.

Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.