Las Vegas housing market moving towards traditional sales

The Las Vegas Review Journal recently reported that the average single-family home price in Las Vegas increased by 24.2% over 2013, while condo prices went up by 26.3%. This remarkable growth represents one of the fastest growing cities in North America, and is a prime reason why Las Vegas has become a prime destination for real estate investment.

The recent growth in prices was primarily from purchases of previously foreclosed upon homes. These homes were bought via short sale, meaning the lender agrees to sell the home for less than what the borrower owes. This was a concern for economists as a high level of short sales is indicative of a weak economy with too many homeowners that cannot repay their mortgages.

However, the number of short sales has decreased significantly over the second half of 2013. They made up 20.7% of Las Vegas sales in December, down from 45.8% a year earlier. The number of traditional home sales (rather than short sales) has nearly doubled over the past year.

This is positive news for Las Vegas as the decline in short sales means the economy overall is recovering, and individuals are able to repay their mortgages. In addition, the price of homes sold via short sale is often lower than traditional sales. As the number of traditional sales increase, home prices should continue to rise and eventually stabilize as the Las Vegas economy recovers across the board.

Read the LVRJ article here