Clark County RE Market Update

Clark County RE Market Update
May 2018

Home Values are Surging Since January
Will the End Come with a Warning?

Current Market Conditions

Inventory levels remain very near the lowest they have been since 2006 and buyer activity levels, as measured by Lockbox openings, continue to move steadily higher. In fact, buyer activity has increased around 42% since mid-January, just 4 months ago.

What can we expect in the future?

According to the little known market theories of Chris Kelsey, there are two home value determinants. The most well-known component of value is the Fundamental Market Value. During times of extreme conditions of demand or supply, there exists a second component to value which I call the Hysteria component.

The Fundamental Value is the basic market value during normal steady somewhat balanced market periods. These values prevail when the supply and demand are nearly in balance. You know you are in a balanced market when well priced homes stay on the market for 2-6 weeks before going pending or homes receive only one offer at a time.

Hysteria Value: As the market swings to the extreme as is currently happening in Clark County, we can experience a market that is out of balance.  During these times properly priced homes often receive multiple offers in just days on the market. Under such conditions there develops a hysteria which has an auction-like effect. This Hysteria component can add $5,000 to $15,000 to the value of a home in Clark County. There are techniques that agents use to take advantage of such conditions. I understand that in areas such as Southern California and San Francisco the Hysteria component can have a much larger effect on dollar value.

Since the first week of January through April we saw the number of buyers growing steadily with no corresponding increase in homes for sale. As buyers have fewer homes to choose from, they become frustrated and the hysteria component sets in. Buyers then begin bidding over list price. This situation describes what is currently happening in Clark County but this trend often will fade starting in mid to late summer for two reasons.

Historically, we see the number of buyers start out the year strong and remain strong through around August. During the first 4 months we typically see new listings remain weak, an odd carryover from the holidays. Then, around May we see new listings begin to rise. This rise in listings typically continues until fall.  At some point between late summer and fall, the number of listings grows faster than the number of buyers  causing the hysteria component to disappear quickly and without warning. This could result in a sudden drop in home values of $5-$15,000.
So if you are considering selling, your odds of getting the best price possible this year is to sell before mid-August.

The second reason this hysteria component will likely fade is that part of the surge in buyers now is caused by the expectation of future rising interest rates. Buyers that were planning to buy in the next few months are moving up their plans so as to take advantage of today’s lower interest rates. When interest rates do rise enough then we will see buyer activity drop off and the hysteria component go away.

Is There a Connection Between the Stock Market & RE Market?

Is the stock market, with its recent wild swings up and down in 2018 suggesting rough waters ahead for the housing industry?
In 2007 our nation’s economy as well as the world took a nose dive that changed people’s lives in a negative way. I used to think that the stock market was the first indicator of rough times ahead but my views changed when in 2007, as I recall, the housing market gave major clues about 18 months ahead of the stock market.

The stock market began its major drop around mid July 2007. According to the RMLS stats, inventory levels suggested the housing market was changing majorly for the worse 18 months earlier than the stock market began its drop.

So, if the inventory levels of RMLS stats are the best indicator of market trouble ahead then the recent stock market drops are NOT indicators of a market housing crisis. Inventory levels for 2018 are suggesting that a crisis is not on its way. 2017-2018 inventory levels are nearly exactly the same, month to month, with inventory levels of the prior year. If this should change and inventories begin rising then it might indicate future trouble with the housing market as well as trouble for the overall economy  in the months ahead.

Naturally, we cannot be sure that the early indicators from 2007 will be the same as this next crisis. But if it is then we are good for many more months and likely years  ahead.

If you are thinking of selling this year and have the flexibility to do it now or in the fall then let’s talk and see if selling early or later is better for you.

Did you see where just days ago legislators did away with the Dodd-Frank rules created just a few years ago to prevent the loose lending rules that contributed to the world’s 2007 economic crisis? It may take years for such conditions to return but it is worth keeping an eye on.

Got Time For Coffee?

Helping get  answers to your question  is what gets me up each morning. It is my purpose for being. If you have a question pertaining to real estate ( or chickens or composting for that matter)  fire away. I am eager to help.  And if you wish to meet for Coffee (or tea or lunch), let’s do it. Thank you


I have  a new home with over 3,000 square feet on a beautiful treed 5 acres located about 5 minutes north of Vancouver Mall. For a video tour, click on the link below.

About ½ mile north of Dollar’s Corner (72nd Ave and 219th St.) I have a new one level home with over 2800 sq. ft. on a quiet private 5 acres. For photos and details, click on the link below (link is good for only a few weeks). A video is underway.
Control click the following link:
(If these links do not work then try pasting them into your browser)

KELSEY FAMILY FARM: Lily Comes to the Farm (The latest stories)
Where Eagles Dare
    Thirty new hens have been turned out into the chicken run. There have been some testy confrontations with the old girls as the new kids find their place in the flock. Much drama in the run when a bald eagle swooped down and grabbed a hen. We moved the trampoline in as a safe base between the feeding station and coop. Roosters are good at raising the alarm when the eagle is circling but we are looking at more options to shield the flock. Farmer’s market was a success! We look forward to our fall market.

Wanting to do some pickling this year?

We will have pickling cucumbers and fennel this summer. Organically grown using compost matured on-site with our own materials including chicken and sheep manure.  Call or email in your orders and I will let you know when it is ready. Harvesting will occur in late June through September. All orders are picked within hours of delivery.

More about the Kelsey Family Farm can be found at
The brain child and owner of Kelsey Family Farm: Jonell Kelsey

Chris Kelsey,
Keller Williams PP

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