(Kimberly James) – The pace of new home construction in southern Nevada is at record levels, even amidst a pandemic.
Las Vegas Realtors President Tom Blanchard told The Center Square that the record pace of new home construction is due in large part to the current demand.
“Demand, and the lack of any other choice, are driving new home construction,” Blanchard said. “Not enough sellers are selling their homes because they’re owned by the hedge funds; people have no other place to move to. The only other available inventory to bring in is from building brand new homes.”
Blanchard said the demand in the housing market is putting upward pressure on home values.
“We haven’t built enough homes in Las Vegas, and with the low interest rate, you have a perfect storm of high demand, low inventory and, voila, prices increasing,” Blanchard said.
More than 3,600 new home permits were pulled in southern Nevada during the third quarter, more than double second quarter figures. September’s count was up 90% over the same time last year, according to the Las Vegas Review Journal. New home sales and the median new home sales price were also up over the same time last year.
Home sales in southern Nevada have hit a median price sale range record for the fifth month in a row, landing at $340,200 for the month of October.
The number of local homes available for sale is currently at a one-and-a-half month supply, Blanchard said, when the normal sales pace or balanced market is a six month supply. This is similar to what is happening across the rest of the country; National Association of Realtors reports a 2.7 month supply through September.
“The one fear I have is that people take their money off the table,” Blanchard said. “If homeowners finally start feeling that we’re at the top of the market and want to remove the money off the table and start selling, that could cause some potential issues with values in Vegas. Otherwise, I think this continues up until the time that someone starts changing the demand by increasing interest rates.”