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Las Vegas home sellers cutting prices amid rising mortgage rates

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The one-story homes in the southwestern Las Vegas Valley boast vaulted ceilings, crown moldings and open floor plans.

It’s a “jewel” and the list declares — and prices were cut by $ 25,000 on Tuesday as local and national home sales fell.

Not only that. In Henderson, home prices fell about $ 31,000 on Thursday, and in the northwestern valley region, home prices fell twice this week, for a total of $ 110,000, as seen on the list site Zillow.

Increasing market share of homeowners are lowering prices in southern Nevada and across the country As a higher borrowing cost After a year of significant price increases, it becomes even more expensive for people to buy a place.

In the Las Vegas region, 13.7% of active lists were reduced in May, compared to 11.5% across the United States, according to Zillow data.

Locally and nationwide, the share of price cuts rose in May for the third straight month.

This doesn’t seem to be surprising. Rising mortgage rates have ended cheap money that fueled rapid sales and record highs in the US unexpected housing boom after a pandemic hit, and people are now also with gasoline in high inflation. I’m paying more for other products.

“Affordable Crisis”

Zillow economist Nicole Bachaud said in an email that the seller “finally” after the buyer “looks willing to meet almost all asking prices and often bids for a list price to defeat other interests. Is being challenged to make home prices competitive. ” Buyer. “

“It’s absolutely true that there is an affordable price crisis in the housing market,” she said, with low mortgage rates on a monthly basis, despite prices rising at record paces. He said he was “suppressing” payments.

However, monthly payments for typical US homes are now 65% higher than they were a year ago. In Las Vegas, it’s almost 80% higher.

Mary Preheim of Keller Williams, a list agent for discounted Southwest Valley House, said prices have fallen across the valley and she hasn’t seen such a surge in price cuts in recent years. ..

The Las Vegas housing market remains strong as she could sell homes in two and a half weeks instead of “four hours” as last year when mortgage rates were at record lows. Claim to be.

Moreover, many asking prices were “unrealistic” in the first place.

“Last year it was spoiled,” Preheim said.

“You can’t overpriced”

for now, Sales are declining as prices continue to rise.

According to industry group Las Vegas Realtors, the average selling price of previously owned single-family homes reached a record high of $ 482,000 in May, up 25.2% or $ 97,000 from the previous year.

Over 2,900 homes were traded last month, down almost 9% from May 2021.

Las Vegas-based HomeBuilders Research reported that in May, builders recorded 767 net home sales (newly signed purchase contracts minus cancellations) in southern Nevada.

Meanwhile, according to mortgage giant Freddie Mac, the average 30-year mortgage rate was 5.78% on Thursday, up from 5.23% last week to 2.93% a year ago.

Weekly rate hikes were the largest in decades.

With high inflation, fears of recession and soaring borrowing costs, the Las Vegas housing market faces an uncertain future, to say the least.

Still, the housing market tends to change direction, especially in Las Vegas, and there are always people trying to buy a place at a bargain price, which is unusual for the last few years.

No one knows where the values ​​of the home will go in the coming months. But, as Tim Kelly Kiernan, branch manager of RealtyOne Group, told me, there have been “crazy numbers” price cuts in the last week in southern Nevada. The numbers he pulled from the Las Vegas mainlist service.

“I can’t get high prices anymore,” he said.

Contact EliSegall [email protected] Or 702-383-0342.follow @eli_segall On Twitter.

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