If you’re looking to buy or sell a home right now, you know that the housing market is in a weird place.
In Las Vegas, the median price for an existing home in December was $470,000. That’s down from the record high of almost $489,000 a month earlier. However, it's considerably more than what a house cost before the pandemic – about $150,000 more.
At the same time, the number of houses, condos, and townhomes sold last year was at its lowest number since 2007.
So, if sales are down, why do prices remain so high?
According to Realtor David Brownell, it's a question of inventory.
"Supply definitely is up since last year, but when we only have 8,500 units on the market in Las Vegas, a town of 2.2-plus million folks, that's not a lot," he said. "When we're selling 3,000 units a month, we barely have, or don't quite have, three months of inventory at this time. That's certainly better for buyers, I wouldn't call that an all-out buyer's market."
Brownell adds that relatively high interest rates are also keeping a lot of potential homebuyers out of the market.
"A house where I've got an interest rate that's in the three or four percent range, and I'm looking at a higher interest rate — my payments are manageable right now, it's fixed — there's no sense of urgency," said Brownell. "Prices aren't going down. So, the market's still kind of stuck in somewhat of a stalemate.
While house prices remain high, rents are starting to come down. Last year, some areas of the Las Vegas Valley saw rents drop nearly 15% from the previous year.
"Rent prices have definitely softened over the last 12 months, and that's been helpful for the overall community in Las Vegas," said Brownell. "Prices have gotten pretty high compared to incomes, even to rent. And so that little softening in that market, I think, has made it better, but prices are still high across the board.
One policy that might shake up the market is ending corporate homeownership. It’s an idea some state lawmakers have pitched in recent years. And now President Trump recently signaled an interest in banning or limiting.
It's something Nic Irwin has started looking into. He’s the Research Director at the Leid Center for Real Estate at UNLV. The research is preliminary, but he's already run into a snag. It's hard to know exactly how many corporate landlords exist in the state.
"Our data is not very good at looking at this question," said Irwin. When [political leaders] talk about investors, there's a squishy middle when we mean investors. Everyone likes to use the term corporate investors, but we don't have a clear definition of what corporate investors are."
There are also several hurdles facing any policy limiting corporate homownership. Not least of all, Irwin said, is the fact that corporations have rights.
"It's really tough to interfere with the free market from folks wanting to purchase properties," said Irwin. "After all, corporations are recognized as having rights, and the right to purchase property would be right up there with their right to have free speech, potentially."
Guests: David Brownell, realtor, Brownell Team Realtors; Nic Irwin, research director, UNLV's Leid Center for Real Estate
