By Hubble Smith
LAS VEGAS REVIEW-JOURNAL
Posted: Feb. 11, 2011 | 2:02 a.m.
The housing market in Las Vegas is expected to chug along at about the same pace as last year, with the "shadow inventory" of bank-owned homes clouding any prospect of even modest recovery, housing analyst Dennis Smith said Thursday.
He projected about 4,500 new-home closings in 2011 and 4,700 in 2012, compared with 4,761 last year. Resales will increase to 43,250 in 2011 and 44,500 the next year, up slightly from 42,673 in 2010.
Median existing-home prices have consistently bounced between $119,000 and $125,000 for all but two of the last 19 months and will probably remain flat this year, the president of Home Builders Research said in his Housing Outlook 2011 webinar.
The median price for a traditional single-family new home was $216,000 at the end of last year, almost identical to 2009.
Buyer traffic through new-home subdivisions fell to 101,305 in 2010 from 129,442 the previous year, while net sales dropped to 4,264 from 4,811, Home Builders Research reported.
Weekly net sales per subdivision bottomed out near 0.1 at the end of 2008 and into early 2009, peaked at 1.1 around the middle of 2010 as buyers took advantage of the federal tax credit and slipped to the 0.2-to-0.3 range at the end of the year.
Traffic count rose to 13.4 a week during the tax credit period, dropped to 7.5 toward the end of the year and bounced back to 11.8 in the last two to three weeks, though net sales have not kept pace.
"This leads us to believe that buyers are much more discretionary," Smith said. "They're taking the time to look at product from new-home builders and there's a lot of competition."
D.R. Horton grabbed a 15 percent market share with 659 new-home sales in 2010, followed by Richmond American with 526 sales (12 percent) and KB Home with 483 (11 percent).
Smith said the top homebuilders bought most of the distressed lots in the Las Vegas Valley and were able to turn them around quickly, building at a competitive price advantage because of lower land costs.
More than 19,000 finished lots remain in the valley, about 70 percent of them controlled by builders or developers and the rest owned by investors and banks.
Most of the builders have no interest in selling those lots at this time, Smith said.
"They're holding them and that shows they have confidence in the long-term outlook of the Las Vegas market," he said. "Now that may change. We may have by the end of the year some builders who want to liquidate their lot holdings, but that remains to be seen."
The typical cost of a finished lot is $45,000 to $50,000, depending on location, Smith said. Pulte and Richmond American paid $70,000 to $105,000 per finished lot in an "A-plus" area across from Bishop Gorman High School in the Summerlin community, he said.
Smith projected 4,300 new-home building permits for 2011, down from 4,550 last year. They should climb to 4,600 in 2012.
"We leveled off at about 350 (permits) a month and I think we'll see that pace continue through 2011," the housing expert said. "Don't expect to see a spike like we did in 2010 when it went to 730 during the federal tax credit."
Estimates of the so-called "shadow inventory" of foreclosed homes not yet listed for sale range from 50,000 to 100,000, depending on the source.
Smith looked at data from Foreclosure.com, RealtyTrac and Foreclosure Radar and said they're all different. The Clark County Assessor's Office showed 3,132 more foreclosure sales than trustee deeds, or bank acquisitions, in 2010.
Smith settled on 12,450 as the number in the silent inventory and another 9,100 properties that will go from short-sale listing to real estate-owned, or bank-owned. Add 15,000 notices of default filed last year and that's 37,000 to 38,000 imminent foreclosures "staring you in the face," he said.
Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.
Top-selling master plans Community 2010 resales Average price Average age Average lot size
Summerlin 2,651 $314,408 10.8 6,738
Mountain's Edge 1,182 $208,369 4.5 5,073
Anthem 998 $309,468 7.2 8,101
Southern Highlands 956 $264,688 7.7 6,346
Aliante 819 $188,569 5.8 6,180
Coronado Ranch 721 $204,984 6.5 3,667
Rhodes Ranch 765 $188,607 6.8 4,136
Silverado Ranch 657 $167,730 10.4 4,914
Eldorado 421 $150,161 12.3 6,356
Green Valley 432 $218,160 21.8 8,044
The Lakes 435 $195,425 23.1 6,223
Spring Valley 441 $136,311 29.5 6,170
Spring Mountain Ranch 433 $158,147 8.4 4,865
Source: Home Builders Research
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