“It is always a little bit confusing when the experts can’t agree on their predictions of the future. But the differences are not that great,” stated R. D. Campbell of Dr Cash Home Buyers, a home buyer company in Las Vegas. “I think the primary factors of supply and demand will not change much in 2020. I do think that other factors will have a greater impact, such as a continuing trade war with China. This year’s housing market has cooled off from the heated pace of 2018. Given the fact that Las Vegas matched its historical high of a median price in September 2018 I think a bit of cooling-off is a good thing,” he commented.
The website, DrCashHomeBuyers.com, is a cash home buying company in Las Vegas that focuses on the house investors segment of the market. The majority of homes that are purchased by the company are remodeled or rehabbed and either sold to a retail home buyer or a landlord for rental. These house investors make all of the needed repairs to the property and they assume all risks, including the risk that home prices might tank.
The median price of a “resale” home was $315,000 in September 2019 as calculated from data from the Greater Las Vegas Association of Realtors. This matched the all-time high of June 2006. After the Sub-Prime Lending scandal of the 2000s, the median price of a Las Vegas home hit a low point of $112,000 in early 2012. Home buyers have seen housing prices decline slightly from this September high to about $307,000 in November and early December.
The National Association of Realtors recently published their prediction that the Las Vegas residential housing market would “overperform over the next several years.” This estimation was based on an assumption of continued strong job growth and population growth.
However, a report from Realtor.com published at about the same time predicted that Las Vegas housing prices would decline along with 25% of the top housing markets in the country. They predicted a 1 percent decrease in home prices in 2020. An economist with the organization stated that there is a “double-digit” percent decline in the number of existing homes that people can afford in Las Vegas. This affordability concern seems to have been an important part of their prediction.
Obviously some parties have some strong words to offer about the others’ reports. The Greater Las Vegas Association of Realtors has firmly stated that they agree with a stable and steady growth prediction. The president of this association stated that “the realtor.com forecast didn’t make sense to me.”
Las Vegas and Southern Nevada has had one of the hottest residential markets in the last two years. Growth in jobs and population along with a tight inventory of homes led to some of the biggest annual increases in home prices in the country. But 2019 has been a much more stable year with moderate price increases. It will be interesting to see how 2020 shapes up for the residential market.
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