Welcome to 2019! By all accounts, January sales of Single Family Homes in the Las Vegas Valley was lower than the same period last year. There are multiple variables that play a factor in this such as rising interest rates, seasonality, and affordability but one statistic sticks out to me more than any other…and that is available inventory.
Basic economics dictates supply and demand control prices of a product. We went from 1.3 Months of Inventory on Hand (if no new homes were listed, all existing homes would sell in 1.3 months) in May of 2018 to 4.6 Months on Hand at the end of January 2019. That’s 3x as many homes for sale!
Most real estate professionals believe 4-6 Months on Hand shows the market is balanced. There are enough homes for sale to meet the needs of all the buyers, and generally, there is no advantage in negotiating to either the buyer or the seller.
“What does the mean to me as a buyer/seller?”
This is what normal feels like (I think???). I know we haven’t really had a normal real estate market in Las Vegas since about 2002 so this is new to most of us. We had the wild ride up that ended in 2007 and then the crash that ended in 2012. Since then we’ve experienced a few mini-booms equalling 65%-80%+ gains in most neighborhoods since 2012.
Buyers, don’t sit back too much…the same number of people are looking for homes today as yesterday…and they are likely looking at the same homes you are. You’ll likely see less bidding over list price and depending on days on market and inventory in that neighborhood, you may be able to negotiate some costs and expenses.
Sellers, there are 2 other homes like yours now on the market…Price it right! Its much harder to create a new high comp for your neighborhood, especially if you haven’t updated your home in the past 12 months. Make it easy to show your home and hire a professional. You’ll get what you pay for…iPhone pics and 1 sentence descriptions in MLS just won’t cut it.
This is a screenshot of the overall MLS transactions from mid-day on January 31, 2019. Notice anything? 472 people decided to reduce their price…that’s like chumming the waters with sharks around. Price it right the first time and don’t give buyers a reason to think you’re willing or needing to decrease further.