There’s sudden real estate inventory amid rising interest rates in the Las Vegas Valley
LAS VEGAS, Nev. (FOX5) - From waitlists to bidding wars, the hot housing market is seeing a cooling trend after a sudden rise in interest rates.
In June the Federal Reserve launched its largest increase in interest rates since the 1980′s. Interest rates are now around 6%, up from 3% a year ago.
In January, FOX5 sat down with Jennifer Graff, founder of New Home Experts Las Vegas with Coldwell Banker (S0071420.) Graff said the Fed’s would raise rates throughout the year to curb inflation so what we’re seeing is no surprise.
“About $480,000 right now is essentially the median home price for here in Las Vegas. So when you take into account, when we talked back in January, to when we’re speaking today- that payment for your average conventional loan is up almost $1,000 for that $480,000 home,” Graff said.
According to Redfin, at the end of 2021 a homebuyer on a $2,500 monthly mortgage could afford a $517,000 home, but that same homebuyer could only afford a $400,000 home now with a 6% mortgage rate.
Graff said when the marketplace was hot- they were writing 26 offers on one home which was not normal real estate transactions.
“If we were talking even three months ago we were talking waitlists, and lotteries, and you know just incredible situations with people just wanting to get into that brand new home- that has changed overnight,” Graff said.
The new home builders in Southern Nevada now have some inventory.
“There are situations where people who didn’t lock a rate in and unfortunately can’t afford to get into that brand new home, so now that brand new home is back on the market. Now all of a sudden the builders are talking about incentivizing people with larger closing costs, rate buy downs, locking in rates,” Graff said.
Graff said don’t expect a drop in prices but predicts stabilization.
“We have about 5,600 homes on the market right now that is almost double from last year,” Graff said.
80% of her clients are based out California, Pacific Northwest and the Midwest and most are cash buyers.
She says if you can stay in the market there is opportunity. Sellers are more willing to negotiate.
“We had 1,300 price decreases this past week,” Graff said.
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