Wednesday, Jan. 19, 2005 | 10:47 a.m.
It may come as no surprise that the Las Vegas housing market shattered records last year in terms of sales and pricing, but what many people may be surprised to hear is that this year may be better than most people are expecting, local market experts said.
"The second half of 2005 will be almost as memorable as the first half of 2004," Steve Bottfeld, executive vice president of Marketing Solutions, said.
Many industry experts and homebuilders are expecting 2005 to be a strong year, but some have said it will not be as stellar as 2004. The local housing market was high-flying during the first six months of last year but then many said it hit a plateau and softened slightly during the second half of the year.
Bottfeld expects that inventory in both the resale and new home markets will dwindle by July, causing demand to again exceed supply.
Larry Murphy, president of SalesTraq, was a bit more muted in his forecast of this year's supply demand balances.
Murphy said the number of permits for new homes that are issued should continued to be monitored to see if there could be a tightening of the market later this year. He said the number of new home closings exceeded the number of permits pulled during the second half of the year.
"I agree that the inventory is decreasing every month, based on the number of permits pulled and closings," he said. "That would lead one to think that the inventory is being consumed."
Bottfeld expects new and resale home prices to increase by 20 percent in the second half of this year.
Bottfeld and Murphy will discuss the good and bad of 2004 along with what may happen this year at its quarterly seminar at the Tropicana on Thursday morning. The duo also will discuss the valley's burgeoning high-rise market.
Last year ended with 28,773 new home closings, a 14.5 percent increase over 2003, SalesTraq reported in its monthly newsletter, released with Marketing Solutions on Tuesday.
The median price of a new home at the end of 2004 was $252,732, a 25 percent increase over the same time period in 2003, SalesTraq reported.
Existing homes also ended 2004 on a high note, with 59,613 closings, a 28.6 percent increase over the previous year, SalesTraq reported. Median resale home prices surged almost 40 percent over the previous year, reaching $231,563 at year's end.
There were 4,061 resale homes and 3,073 new homes that closed escrow in December, SalesTraq reported.
Bottfeld said December is the first time new home closings have exceeded 3,000 in a single month.
"I think we're going to have over 30,000 (closings) for new homes next year," he said. "If you think about that, we're saying it's going to average 2,500 units a month, so at some point we'll crack that 3,000 mark again."
Murphy said closings of condo conversions, midrise and high-rise condominiums will help boost the number of new home closings this year.
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