So, now that the New Year is upon us, how are things looking for the Summerlin (Vistas and Paseos) housing market?
Glad you asked…I have some thoughts I’d like to share.
Previously I spoke of the slowdown in the market and that the holidays, election and interest hikes were to blame, along with increased inventory, so let’s see how those things have played out over the past few months.
- Holidays – over. Buyers are back out there looking for homes. I am seeing more properties go under contract, especially those that are priced well and show well. We are about to head into our busy season of Spring, so sellers are getting homes ready and buyers are starting to reach out to their lenders to get prequalified.
- Election – done. We do still have this wall issue and trade war with China that needs to be agreed upon, but it shouldn’t effect the housing market much longer. With pressure from constituents, the government officials will stop their showboating and figure something out before everyone takes to the streets and personally removes all of them. Haha. At least now we know what we’re dealing with in Congress and can predict that a whole lot of nothing is going to get accomplished due to not one party having both houses.
- Interest rate hike – Since my last post in October/November, the interest rate has come back down, (around 4.45% on 30yr fixed) which has helped buyers afford more home for their money. Always helpful to keep the housing market moving along. But even if they go higher, as it is predicted to do over the course of the year, it is much like getting a new job that doesn’t pay as much as the old one…we all adjust. It’s not fun at first, and we complain and stomp our feet, but then we forget what was once “normal” and just do what we can and live within our new means. Much like rising gas prices – at first we get all up in arms about it, but you know what?…we all need gas so we’re gonna pay it, but we may take fewer unnecessary trips. Example: The old “Sunday drive.” Who even does THAT anymore? The Fed is predicting to do a couple more rate hikes this year to help stabilize things, so if you’re a buyer – I would get moving if you know you’re going to move. Your buying power goes down with every rate hike, so work on that credit, save up your money for a down payment and closing costs.
- Increased inventory – This is still happening and could actually be helpful in moving this market towards its projected 9% increase in sales price in 2019. Why you ask? Well, if you remember last year when inventory was super low and there were a gazillion offers on every home and they sold in a few days or even hours? Well, if you were a seller and your house sold overnight and competition for a replacement home was through the roof – what would you do? Be homeless with no where to go or move into a rental – Neither is ideal. Those days were very uncertain for a seller, so they just waited and didn’t sell because they had no where good to go. Well, now that inventory is up, they will start to believe that they WILL be able to find something that will suit their needs and not just someplace that they will “settle for.” All of this will help to move us to a more healthy market with a more even exchange of inventory.
Some other things to note:
- Conventional ($484,350), FHA ($322,000) and VA($484,350) loan limits have been raised, allowing buyers to get homes at a higher price point. Speak with your lender for up to date limits.
- Medium end homes (Around $600k) are taking a little longer to sell, but not too bad averaging 37 days on market. Sellers are now seeing offers with buyers asking not only for a reduction in price, but also for closing costs assistance (typically 2-3% of sales price) – so sellers should be aware of this new “normal” and buyers can start to take that into account if they are shopping for a home. If they don’t need to come up with as much cash out of pocket to buy a home, they may be more likely to get out there sooner rather than later.
- Luxury listings are slowing down quite a bit. If you are priced over $700K, it could take a while to sell. 72 days on average to be exact. Still not a buyer’s market for 89138 at this price point, but were sitting at about 3 -4 months of inventory, not including new home construction.
- On a good note, in 89138, around 50% of homes are taking less that 30 days to go under contract. That is still good for sellers and motivating for buyers to get out there. The homes aren’t flying off the shelves, but they aren’t sticking around for months either. I would say a realistic time frame for a seller is somewhere between 14-60 days to find a buyer, that is, if it’s priced right and shows well. Sellers will definitely want to take this into account when they decide they would like to list their home and work around their future plans. This timeline can change as we move into the busy season and more buyers enter the market.
As always, I’m here if you have any questions or would like to discuss either buying or selling your home. I would love to help out in any way, at what ever stage in the process you are.
Below are current numbers for single family resale homes in 89138
Active homes waiting for an offer – 123
Under contract – 26
Sold in the last 3 months – 83
Sold in the last 6 months – 192
Average asking price per square foot – $227.00
Average sales price per square foot – $207.00
Average Days on Market before an offer is accepted – 50 days
What I see selling quickly are homes that are:
Below are some of the recent sales for the Vistas and Paseos of Summerlin.
Click on the link below to see the photos and more info. Let me know if you have any questions or would like to sit down and discuss what your home could sell for in this current market. 702-277-7235
Quick overview of the above properties:
Here at GO Summerlin Homes, I specialize in 89138 – specifically the Paseos and Vistas of Summerlin.
I live here, play here, my kids go to school here, and I work here…It’s what I know.
Ginger Oghgian – Realty ONE Group
Are you like many others and are wondering…
What is going on with the housing market right now?
I keep seeing prices on homes in the Summerlin market decrease and decrease and decrease.
It seems the current sellers think we are still in the same market we were in last Spring/Summer. They believe the housing market is going to continue to go up and up and up, so they price their homes higher than the Spring/Summer comps and hope someone comes along, willing to pay a premium. Well, the reason people were willing to pay a premium a few months ago and they aren’t now, is that things have changed.
- The buyers are not as prevalent which removes the competition and brings prices down. (simple supply and demand)
- The Feds just raised interest rates, making the buyer’s “buying power” a whole lot less. They cant afford as much house anymore.
- We have an election coming up and when that happens, we have uncertainty. A whole slew of things can change with legislation.
- Prices are feeling like they have reached the peak. Buyers don’t want to buy a house and pay top dollar for it. They want to think they will have equity at some point.
- Inventory is inching up, so the scarcity mindset is dwindling.
Buyers aren’t buying now because:
- Market uncertainty – the election is looming, interest rates are on the rise, and the market is at a high.
- The holidays – Every year we have a slow down this time of year, due to people not wanting to be in flux during the holidays.
- Prices seem high to them. They think they will just wait out the seller’s market and buy when things go down again.
- Without lots of competition, buyers aren’t willing to offer “over asking” on a property, or waive appraisals. Those sorts of things only happen when people feel like they won’t be able to get a house.
So, heres the deal…we have a few things all happening at once. The slow season with the holidays, coupled with an election, rising interest rates and increasing inventory – all of this is going to do a few things – lessen the number of buyers, decreasing prices on homes listed, or increase the days on market due to lower demand, and lastly, cause people to hold off until the uncertainty in the market is resolved. So, we’re basically in limbo.
For sellers, my advice is to see what happens in January. If you HAVE to sell, then price your home correctly…which may be lower than the Spring/Summer comps. Don’t get caught up in thinking your house is better than one that sold a few months ago and should sell for more. As I have said, this is a different market now.
For buyers, my advice is to really weigh the pros and cons before deciding on buying. Make sure you have all of your financials in order. Save for your down payment, speak with a lender before going to look at properties and ask them how much you would qualify for now, and also, how much you would qualify for if the rates go up again. Be sure that you would be fine financially owning that home, even if the value goes down over the next few years. Can you afford the payment? Is it located in a neighborhood you really want? Don’t bite off more than you can chew.
If you have an questions or would like to discuss this further, feel free to give me a call 702-277-7235.