Existing-home sales slow in valley

Jennifer Shubinski

Wednesday, April 20, 2005 | 11:12 a.m.

The number of resale houses that have sold in the first three months of the year has declined over last year's totals while the number of new houses sold has increased, a market research firm reported Tuesday.

The shift is simply a sign that the housing sector continues to adjust to a more balanced market, said Dennis Smith, president of Home Builders Research Inc.

In March there were 5,470 recorded resales, bringing the year's total to 12,698 existing houses sold, Smith reported. When compared with last year during the same time period, the number of resale closings declined 13 percent, or by 2,078 existing houses.

The supply of existing houses on the market has remained relatively stable during the last four months and the number of new listings has dropped, Smith reported, pulling from data provided by the Greater Las Vegas Association of Realtors.

The number of recorded new housing sales in March reached 3,135 houses (including 515 apartment-to-condo conversions), a year-over-year increase of 7,791 houses, or 11 percent.

But Smith said while the resale and new housing data is interesting, it's the new home permits that he's been closely watching.

In March, there were 2,714 new home permits issued valleywide, bringing the year's total to 6,669, or 27 percent fewer year-over-year, Smith reported.

"It's an adjustment," he said. "The builders have been selling off inventory and anytime they have inventory there's going to be deals out there."

The change is in response to the over-supplied state of last year's market, he said.

While there have been fewer permits pulled when compared with last year, the number of permits pulled has continued to increase during the first three months of 2005, according to Home Builders Research data.

In order for the Las Vegas Valley housing market to return to a more balanced condition with permits and closings almost equal, there has to be less product available that competes with the new home segment, Smith reported in his newsletter.

The median price of a new house in the Las Vegas Valley in March was $281,315, a year-to-year increase of $55,502, or almost 25 percent. If apartment-to-condo conversions (classified as new product) are excluded from the equation the median new home price was $304,734, Home Builders Research reported.

The median price of a resale house in the Las Vegas Valley in March was $257,000, a year-to-year increase of $48,500, or 23 percent, Home Builders Research reported.

"Was it, is it, a good time to be buying? Absolutely," Smith said. "Overall, long term it's a good time to buy. Is it a good time to buy if you're an investor and you want to flip? No."