Las Vegas Real Estate Experiences a Different Kind of Boom
By Richard BarringtonLocal Lender Columnist
May 13, 2008
The New Frontier Casino, which hosted Elvis Presley's Las Vegas debut, was imploded recently to make room for a new building. As the dust cleared from the explosion, there may have been some Las Vegas home owners wishing they could blow up their properties too, as median home prices in the area have slumped. A bit of perspective, though, shows a housing market which is still fairly healthy and perhaps creating new opportunities for buyers.
Las Vegas Home Prices Slip, but Still Strong
The bad news is that Las Vegas home prices continued to slump in the second quarter of 2007, extending a slide that has seen them decline by 3.6% year-over-year. However this decline comes after the median home price in Las Vegas increased at a 14.4% rate in 2005 and at a 4.2% rate in 2006. In other words, all but the most recent buyers are still ahead of the game.As for future buyers, the softening of home prices may represent a ray of hope. With median home prices in the Las Vegas area nearly back down to 2005 levels, prospective buyers may get a chance to buy into a market they thought they had missed when home prices were soaring.
Mortgage Rates a Clear Positive
If median home prices are a glass-half-full/glass-half-empty proposition, the clear positive is in the recent downward trend of mortgage rates. Lower mortgage rates help both buyers and sellers. For new buyers, lower mortgage rates mean they can afford higher home prices. For sellers, lower mortgage rates stimulate increased demand for housing, which helps support the housing market.Having home prices and mortgage rates decline at the same time means both trends favor the buyer, so even with the New Frontier Casino gone, area home buyers may be humming "Viva Las Vegas."
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About the Author
Richard Barrington is a freelance writer and novelist who previously spent over twenty years as an investment industry executive.