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Las Vegas New Homes Market Conditions Report for July 2010

By LasVegasShortSales

NAHB Housing Market Index August 2008-2010

National Housing Market Index

National New Home Market Report

Home builder confidence in the newly-built, single-family housing market is down for the third straight month this month.

After reaching a 3-year high just 90 days ago, the National Association of Homebuilders’ Housing Market Index is now at a multi-year low. It’s since dropped by almost half.

As an economic indicator, the HMI’s goal is to “take the pulse of the single-family housing market”. It surveys home builders across the country and asks them to report on 3 facets of their business:

  1. How are market conditions today?
  2. How do market conditions look 6 months from now?
  3. How is the prospective traffic of new buyers for new homes?

Responses are then collated, weighted, and presented as the Housing Market Index.

The August HMI reading of 13 is the lowest since March 2009.

Not surprisingly, the main reasons why HMI is down echo the main reasons why consumer confidence is down. Jobs growth continues to be weak; credit guidelines remain restrictive; and, home values are recovering slowly, pressured by distressed properties.

Builders report watching foot traffic stagnate and most likely won’t want to be stuck with excess inventory into the fall and winter months.  For home buyers in Henderson , drops in builder confidence like this can be an excellent negotiation tool.

Builders may be more likely to offer incentives and/or price reductions into an uncertain economy, as compared to a strong one. Furthermore, weakness in home building indirectly drags mortgage rates lower.

This one-two combination can make for cheaper homes with cheaper monthly payments.

Las Vegas Real Estate New Home Market Report

According to Larry Murphy of Salestraq, new home sales which had surged in June to beat the Federal tax credit closing deadline slid back to May levels.  Still, the total of 408 units sold exceeded last year’s level by 1.5%.  In fact, in six out of the seven months of this year, new home sales have topped last year’s numbers. The positive: 2010 should be a slightly better sales year for new homes than last year. The negative:  It is still a weak new home market.

LAs Vegas New Home Closings thru July 2010The new home sector is somewhat more difficult to analyze because of the inclusion of 90 Hi-Rise closings at CityCenter.  The median price of a new home jumped from a century low $182,440 in June to $210,000 in July.  Obviously, that number and that change were influenced by the CityCenter closings.

The new home average price per square foot  barely changed from June’s $101.51 to July’s $101.57.  (Hi Rise closings are not included when calculating median price per square foot.)

Las Vegas Homes Inventory

1. The number of new home subdivisions in the Las Vegas Valley fell to 219 – the lowest total in this century.

2. The number of new home permits in July slid to 364, a 14% drop from last month and a 19% drop from last year.

3. The 1,907 foreclosures in July were somewhat higher than June figures (+28%).  Yet, that number was 19% below last July.  In fact, five of the seven months in this year have seen lower foreclosure levels than corresponding months in 2009.  Nonetheless, we believe that 2010 will very nearly mirror 2009 foreclosure totals.

4. The 13% rise of available listings in July to 12,772 is the first time this year that any month has been higher than its corresponding month in 2009.  Yet, even at this figure, this inventory represents just 3.1 months of supply at current sales rates.

Considering a Las Vegas Home purchase?  Search all Las Vegas Homes for Sale using our free, interactive map-based search.

Search all Las Vegas Foreclosures, including Henderson, Green Valley and North Las Vegas

Related posts:

  1. Las Vegas Homes Market: Single-Family Housing Starts Fade In July
  2. Las Vegas Real Estate Market News – July Jobs Report Could Spur Mortgage Rates Higher
  3. Las Vegas Short Sale and Real Estate Market Report for May 2010

Categories : Las Vegas Market

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