Relocating for a new job? Need more space for the new baby? Ready to downsize in retirement? Whatever your reasons, it makes sense to keep abreast of the state’s housing market, and know when it’s a good time to buy, sell or invest. We talked with the new presidents of the Greater Las Vegas Association of Realtors® (GLVAR) and the Reno/Sparks Association of Realtors® (RSAR) to get insight on the current status of Nevada’s housing market.
2016 was a good year in Nevada housing, with the number of foreclosed properties continuing to decline from previous years’ highs. Housing sales and prices rose over the previous year. Even accounting for typical seasonal down-turns, December prices and sales for existing housing were higher compared to a year ago in December. Dave Tina, the new president of GLVAR, said he was “pleasantly surprised” to see home sales increasing in the greater Las Vegas area, even in the winter. When asked what he attributed this to, Tina cited the improving local economy and a population that is growing by about two percent per year.
The good news about increased sales was somewhat tempered by the news of housing inventory continuing to shrink. In both the southern and northern markets, 2016 ended with only a two- to three-month supply of homes available for sale, when a six-month supply is considered to be a balanced market. This is causing selling prices to be higher due to supply and demand factors, explained John Graham, the new president of RSAR.
What do these real estate experts predict for 2017? Market conditions are expected to remain similar to 2016, with projections showing moderate increases in sales and prices across the state, as well as continued tight inventory.
A reduction in distressed sales will add to the positive forecast for 2017. “It is at the lowest I’ve ever seen (under 5 percent),” said Tina. “That is great for our market. It stabilizes it, having sellers that care about their houses, selling to buyers who want to spend their lives in the houses – that’s a good thing.”
The expected rise in mortgage interest rates in 2017 may impact some buyers, especially low-income or first-time homeowners. Even a half-percent increase can affect mortgage qualification ratios, pointed out Graham. “The ability of a buyer new to the area to afford a house can be a challenge,” he added, explaining that his organization tries to work with prospective buyers to match them with the best financing programs for their needs, such as VA or FHA loans.
What does the future hold for the Nevada housing market? “Even with the tight housing supply we had in 2016 and even with home prices appreciating at a healthy rate, I think people are still seeing the opportunity here,” replied Tina, referring to the southern Nevada market for 2017. He cited the warm climate, entertainment opportunities, improving economy, and low home prices compared to neighboring California.
As for the northern part of the state, Graham pointed out that new people and new businesses with more jobs are migrating to the area. “Tesla’s ‘gigafactory’ outside of Sparks is getting a lot of publicity, and causing other companies and people to consider moving into the area,” he said. “We are on track for the five-year projection of creating 50,000 new jobs by 2019.”
If it’s time for you to find your dream home in Nevada, contact a Nevada State Bank mortgage specialist for information.*
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The information provided is presented for general informational purposes only and does not constitute tax, legal or business advice. Any views expressed in this article may not necessarily be those of Nevada State Bank, a division of ZB, N.A.
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