Price of existing homes at 20-year low in Las Vegas

By Buck Wargo

Published Tuesday, Feb. 22, 2011 | 9:42 a.m.

Updated Tuesday, Feb. 22, 2011 | 10:15 a.m.

New home sales in January and the price of existing homes tumbled to their lowest level in two decades in Las Vegas.

SalesTraq reported the median price paid for existing homes in January was $109,000, down 9 percent from the $120,000 paid in January 2010 -- and the lowest price since 1991. The median price was $114,500 in December, the firm reported.

The last time the median price for existing homes was priced under $110,000 for the year was 1990 when it was $104,300. It rose to $110,700 in 1991 and hasn’t fallen below that mark since.

SalesTraq President Larry Murphy said existing home prices are likely to keep falling. For the last 19 months, home prices have been fluctuating between $115,000 and $125,000, and January marks the first time the median price has fallen significantly out of that range, he said.

Foreclosure sales continue to keep prices low, Murphy said. Of the 3,785 sales of existing homes, which was down from December but 3 percent higher than January 2010, 1,424 were foreclosure sales, Murphy said.

Those homes fetched a median price of $105,000. Those sold at foreclosure auctions went for a median price of $92,500. But in January even traditional sales, of which there were 1,118, sold for $110,000.

The 756 short sales –- 20 percent of sales -- went for a median price of $120,000, and it will take lenders going that route to ultimately push up prices, he said. Given that 70 percent of the Las Vegas mortgages are underwater -– they owe more on their homes than they are worth –- that may prompt more short sales in the long run and bump up prices, Murphy said.

In January, 7.8 percent of Clark County homes received notice of default, which is down from 19.8 percent a year ago.

“We will continue to see a significant number of foreclosures in the near term for this market,” Murphy said. “Still, given the nature of the Las Vegas economy, we expect a higher proportion of short sales later in the year.”

Half of the existing homes bought in January were purchased with cash and 78 percent were vacant, he said.

In the new home market, the 233 home closings were the fewest since 1990-1991, analysts said. Sales were down 15 percent from the 275 in January 2010, SalesTraq reported.

The median price of new homes sold in January was $208,145, a 3.1 percent increase over January 2010. The median price was $219,000 in December.

The average price per square foot, however, fell to $100.64 in January, 2.5 percent lower than the $103.26 per square foot in January 2010. The price per square foot paid for existing homes in January was $72.89, 8 percent lower than January 2010 when it was $78.94

Builders took out 233 permits in January, 26 percent fewer than January 2010. They took out 295 permits in December.

Las Vegas had 1,520 bank repossessions in January 58 percent higher than January 2010 but only six more than December.

In January 2010, lenders held 14,022 foreclosures in inventory, but that number declined to 12,420 last month, Murphy said.