News Summary
In Southern Nevada, the home construction market saw a significant slowdown in July, with only 802 home sales reported, a 23% decline from the previous year. Despite rising median prices, the number of building permits issued plummeted by 39%. The market faces challenges due to high borrowing costs and an increased resale inventory, alongside labor shortages impacting builders. With a cooling housing market and affordability issues for potential buyers, the region’s homebuilders are struggling despite efforts to address housing demands.
Las Vegas – Southern Nevada’s home construction market experienced a significant slowdown in July, with builders completing only 802 home sales, marking a 23% decline compared to the same month last year. This downturn is attributed largely to high borrowing costs and increasing inventory on the resale market, which offers buyers more options.
The median closing price for homes in the region increased to $519,975, reflecting a 7% rise from July 2022. Despite this increase in prices, the number of building permits pulled by builders fell sharply, with only 804 permits issued in July—a 39% decrease from the previous year.
Year-to-date statistics reveal that builders have closed approximately 5,960 home sales through July, a 15% decline from the same seven-month period in 2022. Additionally, the number of building permits pulled this year stood at nearly 6,360, down 24% from last year.
Market Trends and Challenges
Despite the drop in sales, builders are gradually increasing their base asking prices, which suggests that construction costs remain high and are preventing home prices from declining. Nationally, new single-family home sales also fell by 8.2% in July compared to the previous year, underscoring a broader trend affecting the housing market.
Affordability remains a critical issue, with many potential homebuyers sidelined. According to forecasts from the National Association of Home Builders, approximately 78.7% of households in Nevada cannot afford a median-priced home, which is significantly higher than the national average of 74.9%. Nevada’s homeownership rate stands at 57.5%, ranking 48th in the nation.
The Resale Market
In the resale market, the situation is also challenging. About 2,020 previously owned single-family homes were sold in July, which is a 5.8% decrease from the previous year. The median sales price for these resale homes reached $485,000, matching the all-time high and reflecting a 1% increase from a year ago.
As of the end of July, nearly 7,150 homes were on the market without offers, indicating a 54.2% increase from the previous year. This rise in available inventory is seen as good news for buyers but is also indicative of a cooling housing market. Las Vegas is experiencing the fastest cooling housing market among major metro areas in the U.S., with active listings in the valley growing by 31% in July compared to last year—representing the largest increase of any metro area in the country.
Future Prospects
Challenges for home builders are compounded by labor shortages, which contribute to delays and missed opportunities in an already strained market. A recent study has indicated that, at the current rate of population growth, available land for new home construction in Southern Nevada could run out by 2032. Most of the land for new developments in the region is managed by the federal government, complicating efforts to bring new housing to market.
The Boring Company has received approval for a multi-family housing project tied to a Vegas Loop station, indicating efforts to address the housing challenges in the region. Overall, the homebuilding industry in Southern Nevada employs over 50,000 people and contributes approximately $15 billion to the local economy, highlighting the significance of this sector amid ongoing economic challenges.
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Additional Resources
- Review Journal: Las Vegas Homebuilders Sales Keep Falling
- KTNV: Labor Laws and Land – Biggest Issues Facing Housing
- Fox 5 Vegas: Las Vegas Could Run Out of Land for New Homes by 2032
- Nevada Current: If a Federal Lands Bill Doesn’t Specify Affordable Housing, It Won’t Create Any
- Review Journal: Las Vegas Homebuilding Market is Slowing – Here’s Why
Author: STAFF HERE LAS VEGAS WRITER
LAS VEGAS STAFF WRITER The LAS VEGAS STAFF WRITER represents the experienced team at HERELasVegas.com, your go-to source for actionable local news and information in Las Vegas, Clark County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Electric Daisy Carnival, World Series of Poker, and Consumer Electronics Show. Our coverage extends to key organizations like the Las Vegas Chamber of Commerce and Three Square Food Bank, plus leading businesses in hospitality and entertainment that power the local economy such as MGM Resorts International, Caesars Entertainment, and Las Vegas Sands. As part of the broader HERE network, we provide comprehensive, credible insights into Nevada's dynamic landscape.
