Las Vegas-area home listings top 10,000 for first time in more than a decade

More than 10,000 homes are now for sale in the Las Vegas Valley, according to a new report.

August home sale data provided to the Las Vegas Review-Journal by David Brownell, president of Brownell Analytics, shows this is the first time since 2014 that more than 10,000 homes were for sale within the valley. At the end of August, there were 10,344 homes for sale in the valley.

According to Las Vegas Realtors, based on data from the Multiple Listing Service, there were 10,304 single-family residents, condos and townhouses were on the market for sale in Southern Nevada at the end of August.

Prior to August, the last time the valley had more than 10,000 homes on the market was in the wake of the Great Recession in 2009, Brownell said.

Brownell broke down the multiple factors currently at play regarding the local residential housing market as the valley finds itself in the middle of a housing crisis.

“The bigger story may be what’s happening on the demand side,” he said. “Under contract activity and new escrows have now declined for five consecutive months. And yet, prices are holding. The median single-family sales price finished August at $485,000, exactly where it was last month and exactly where it was one year ago. At the same time, there is now a $60,000 gap between the median price of what is currently listed and what is actually selling.”

The valley’s real estate industry went on a remarkable roller coaster ride during the pandemic when mortgage rates bottomed out due to COVID restrictions, lockdown and supply chain issues. This kicked off a buying, selling and refinancing frenzy which ended abruptly in 2022 when interest rates shot up due to spiking inflation. Since then, sales both in the valley and across most of the metro regions in the country have flatlined, however prices have remained stubbornly high.

“There are a host of reasons that prices have not declined despite the fact that demand has been decreasing for the past few months,” said Brownell. “First, inventory grows, but frustrated owners are cancelling their listings instead of lowering prices if the market does not respond as they expected and or hoped. New owners keep coming to the market, but on the flip side, cancellations are keeping inventory somewhat stable.”

The U.S. housing market has found itself in a “locking” phenomenon given many homeowners either bought or refinanced during the pandemic when mortgage rates were incredibly low. With mortgage rates now above 7 percent again, this means potential sellers are reluctant to sell and give up the rates they got during the pandemic, but also unwilling to drop prices and lose equity on their homes. Thus, buyers have remained picky, locking the housing market.

Brownell said the luxury market is somewhat impervious to this phenomenon, which has impacted sales and overall median home prices.

“The buyers who have remained active in the market are typically more affluent or even all-cash buyers, so that keeps the mix of homes that are selling at a higher median price than what the overall market may actually be experiencing,” he said. “That true impact remains hidden.”

He said some areas in the valley are starting to see declines in sales prices, not just list prices, however the industry is clearly going through a transition period right now.

“In short, the market is correcting through volume before price,” he said. “We have fewer buyers resulting in fewer sales and more houses for sale, but we still do not have a large number of owners who are feeling forced to sell. Until owners feel that financial pressure, sales prices can remain surprisingly resilient even as the rest of the market slows.”