Home buyers and sellers can expect higher prices next year
- Vegas still affordable metro market
- Price growth predicted at 6.9 percent
- Jobs, economy, population growth, incomes strong
Las Vegas will be the top 2018 housing market in the nation, with competitive sales and price growth -- while remaining an affordable metro area.
That's according to a Realtor.com analysis, which took into account what happened in 2017 sales and prices plus the new homes coming out of the ground. Also included were the expected performance of the local economy, incomes, jobs and population.
"People are going to continue to seek out pockets of affordability that remain in the market," according to Realtor.com chief economist Danielle Hale.
"A lot of these places are more affordable than surrounding areas, yet still have strong economies. Even though prices are expected to grow, most of these markets will still remain relatively affordable in 2018.”
Median value may be up more than $35,000
The analysis for Las Vegas predict a median home price of $285,045 (up from nearly $250,000 now), with a 4.9 percent expected growth rate and 6.9 percent of price growth. That's what the best 2018 housing market means.
While the top 100 markets are predicted to grow 6.4 percent in the coming year, Vegas is set to add 8.7 percent.
Las Vegas has been among the leaders in home price appreciation in the past few years, but that follows its less attractive leadership in price declines, foreclosures and zombie houses thanks to the Great Recession. At one point, more than half the properties in Sin City were under water.
While that price growth sounds intimidating, it’s less than half as pricey as most of California – and the major metros along the Coast are as much as five times Vegas’ housing costs. So to no surprise, much of Nevada’s population growth is coming from the Left Coast next door.
According to the Nevada Motor Vehicle Department, a third of new driver’s licenses applications were from people moving in from California – with two Los Angeles area counties among the top three originating counties, followed by San Diego County.
Supply of homes for sale low
The supply of homes for sale in Las Vegas is down to about two months worth of inventory, according to the Greater Las Vegas Association of Realtors. A balanced market is about six month’s inventory.
And GLVAR President David J. Tina expects that to continue to shrink.
“ Overall, the local housing market has been steady and strong, with sales going up and prices appreciating, but not going up too quickly,” Tina said in a news release.
“We have a growing population and an under-supply of homes on the market,” Tina added. “So regardless of what happens here over the next five years or so, we’re still going to need more houses for all the people moving here.”
What’s that mean for Vegas buyers, sellers
So what does that mean for Las Vegas homeowners considering selling in the coming year – or to those who are looking to buy?
Well, it’s good news for sellers, as long as they’re not going to turn right around and buy another home here.
"Anyone thinking about buying a home should be doing everything possible to get themselves ready now," said Jeff Galindo, owner-broker of Open Door Residential on West Tropicana in Las Vegas. "Although prices are not skyrocketing, they're going up and so too are interest rates. Don't wait any longer than you have to if you are planning to buy a home, and be sure to hire an experienced agent to help you find and negotiate the best deal possible."
In our experience, sellers have seen multiple offers – many of them at or above full price. So if you’re looking to sell and price your home according to comparable sales nearby, you’re likely to get what you’re seeking, and fairly quickly.
That’s great if you already have another home, or you’re not going to buy another house in Las Vegas soon. If you’re just going to turn around and buy another home in Southern Nevada, that seller’s advantage works against you in the subsequent purchase. That doesn’t mean you’ll lose money in the long run as both the house you sold and the one you buy should appreciate at about the same rate. It could lessen or negate the gain from the house you sell, though.
"As for sellers, in spite of the low supply, prices have not skyrocketed... which is good," Galindo said. "That said, we are seeing a steady increase in home prices, and people planning to sell should price their home correctly. Today, well-priced homes can get 100 percent of the asking price or more, but there are still many homes on the market for 90-120 days plus that are simply over-priced."
If 2018 is your year for buying a Las Vegas home, it will be more expensive in the coming year than in the past, if the predictions prove true. Add to that the expected continuation of interest rates for home mortgages.
Tax deductions could change
If Republicans manage to push through the tax reform as now crafted, homeowners could lose some of their deduction for mortgage interest payments as well. Both could make buying a house more expensive.
If these changes occur and that prices you out of the market for buying a new home, that’s one thing. But comparing what a house in Las Vegas costs in the coming year with previous cost doesn’t help much in deciding whether to buy. Better questions would be what your living circumstances will be and what you expect houses to cost here if you don’t buy one in 2018.If you have a growing family and now is the time you want to set down roots, well, that’s the hand you’re dealt today, so deal with it. And so what if your neighbor got a better deal by buying earlier? If that prevents you from buying, then you’ll also lose out on the home appreciation expected in 2018. Those differences might be neighborhood bragging points, but smart investors make decisions about what might happen going forward.
Galindo recommends that if you buy or sell, hire a professional.
"Buyers today are smart and they a lot of tools at their disposal," he said. "If you are looking to sell your home and maximize your return, hire a top, local, and experienced agent to help you properly position, price, market, negotiate, manage the closing and sell your home."
The rest of the best
Here are the rest of the Top 10 housing market movers according to Realtor.com predictions:
2. Dallas, TX
- Median home price: $339,300
- Predicted sales growth: 6%
- Predicted price growth: 5.6%
3. Deltona, FL
- Median home price: $275,050
- Predicted sales growth: 5.5%
- Predicted price growth: 6%
4. Stockton, CA
- Median home price: $385,050
- Predicted sales growth: 4.6%
- Predicted price growth: 6.4%
5. Lakeland, FL
- Median home price: $224,950
- Predicted sales growth: 3%
- Predicted price growth: 7%
6. Salt Lake City, UT
- Median home price: $360,828
- Predicted sales growth: 4.6%
- Predicted price growth: 4.5%
7. Charlotte, NC
- Median home price: $325.045
- Predicted sales growth: 6%
- Predicted price growth: 3%
8. Colorado Springs, CO
- Median home price: $375,000
- Predicted sales growth: 3.1%
- Predicted price growth: 5.7%
9. Nashville, TN
- Median home price: $358,501
- Predicted sales growth: 1%
- Predicted price growth: 7.7%
10. Tulsa, OK
- Median home price: $199,586
- Predicted sales growth: 7.5%
- Predicted price growth: 1%