Valley home prices rose at year’s end but trail other metro areas

Home prices ended 2020 on the rise across the U.S., often at a faster pace than in Southern Nevada, a new report shows.

Las Vegas home prices were up 7.9 percent year over year in December, compared with 10.4 percent nationally, according to the S&P CoreLogic Case-Shiller index released Tuesday by S&P Dow Jones Indices.

Among the 19 metro areas tracked in the report, Phoenix led the pack with a 14.4 percent year-over-year price gain, marking its 19th consecutive month at the top. Las Vegas’ price growth was second lowest, ahead, albeit slightly, of only Chicago at 7.7 percent.

Southern Nevada’s casino-heavy economy has been dealt a crushing blow by the coronavirus pandemic, which sparked huge job losses around the U.S. and has kept people home and away from crowds for fear of getting infected, devastating tourism.

Despite the severe economic pain, Las Vegas’ housing market has been on a hot streak for several months, thanks in large part to cheap borrowing costs that have let house hunters lock in lower monthly payments and stretch their budgets.

Around the U.S., price-growth acceleration has been “largely driven by record-low mortgage rates and the severe undersupply” of homes for sale, Selma Hepp, deputy chief economist of housing tracker CoreLogic, said in a statement Tuesday.

Mortgage rates and inventory levels “may take a turn this year and relieve some of the price pressure,” though demand for homes is likely to persist, she added.

In some regions, homes are going under contract with buyers faster than they were a year ago, forcing people to quickly make offers, boosting the likelihood of multiple bids and, ultimately, putting more upward pressure on prices, Matthew Speakman, an economist with listing site Zillow, said in a statement Tuesday.

He figures that as mortgage rates stay relatively low and the “wave of eager buyers” keeps swelling, competition for housing and strong price growth are unlikely to “meaningfully abate in the near future.”

Las Vegas’ housing market was initially hit with a burst of turbulence when the coronavirus outbreak sparked sweeping business closures and other chaos nearly a year ago. But the market recovered and has since reached new heights multiple times.

The median sales price of previously owned single-family homes was $345,000 in January, unchanged from both December and November, when they reached an all-time high, trade association Las Vegas Realtors reported. January’s prices also marked a 13 percent increase over January 2020.

Buyers picked up 2,600-plus houses in January, up 15.5 percent from the same month last year, while more than 2,300 single-family homes were on the market without offers at the end of last month, down nearly 53 percent year over year, according to the association, which pulls data from its listing service.

Meanwhile, Las Vegas’ unemployment rate in December, 10.4 percent, was the highest in the nation among large metro areas, federal officials reported.

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