It is no surprise that Las Vegas’ residential real estate market was hit hard during the economic downturn that started in 2007 and continued on for several years. Factors like a high unemployment rate coupled with a high foreclosure rate and plummeting housing values caused the real estate market to decline rapidly. Now, however, the real estate market has been improving, and numerous factors indicate that residential real estate in Las Vegas is on an uptick.
The Unemployment Rate
Las Vegas is one of the leading markets for improved employment figures in the country. In February 2012, over 15 percent of workers in Las Vegas were unemployed. This figure improved to about 13.2 percent in February 2013, and the current unemployment rate is 9.8 percent. While this is still higher than the national average, job growth has been almost six percent over the last 12 months, making it one of the country’s most improved markets. Employment data is generally a leading indicator of the real estate market, so this trend reflects positive anticipated change for the residential real estate market.
During the recent economic downturn, Las Vegas saw one of the largest declines in sales prices of major markets in the country. However, as of February 2013, the median price of residential sales was up about 27.1 percent over a 12-month period. Between March and April of 2013, home prices increased by over seven percent. The median home price reported by the Greater Las Vegas Association of Realtors in March 2013 was $161,000. This is a marked increase over what home prices were before the downturn. In fact, it represents a median home price that is approximately half of the 2006 median price for a home in Las Vegas.
The Impact of Foreclosures
It is important to note that foreclosures may have some impact on the recovery of the residential real estate market. Approximately four years ago, foreclosures accounted for almost 80 percent of residential real estate sales in Las Vegas. In December 2012, foreclosures accounted for less than ten percent of all residential real estate sales. Both short sales and conventional sales are now controlling most of the market, and this trend is anticipated to continue.
The Future of Las Vegas Residential Real Estate
There are never any certainties with regards to economic data or real estate conditions, and many experts will advise individuals to avoid trying to time the market when making plans to purchase or sell real estate. However, reviewing current market conditions can give some indication on where the market may be heading. With unemployment figures continuing to improve and more workers once again able to find gainful employment in the area, there will be an increasing demand for affordable real estate in Las Vegas. The real estate prices in Las Vegas are still considerably lower than what they were just seven years ago before the residential real estate market crashed, and this leaves ample room for homebuyers to purchase a property at a great price. The number of foreclosures on the market may be dwindling, however, and the price of real estate may continue to make a marked recovery.
With sales prices on the rise and the market improving, now is the ideal time for those who wish to invest in real estate in the area to do so. However, because sales prices are expected to rise, those who are on the fence about selling their property may consider the benefits of watching the market for a few more months.
Daniel Stubbins is a freelance writer based in the greater metro area of Lansing, Michigan. Daniel writes on international business, real estate, finance, investment and current events. To learn more about condos in Las Vegas view these resources from an established company.