Clark County Housing Market Update
Home and Land Market News
Buyer Activity: We have been using the reporting of lockbox openings as an indicator of buyer activity levels. However, new replacement lockboxes for agents were issued this month. This statistic will not be helpful for the next several weeks as agents change out the old boxes for new ones.
Price Reductions: For the second month in a row we had a reduction (10%) in price reductions of all listings in Clark County. Price reductions were at 1,093 in October. While this is about 100 less than in September, we are still almost 500 more than last March.
It is also worth mentioning there was also a decrease of 7% in the total number of listings in October so the actual reduction in price changes was mostly the result of a drop in actual listings, not so much a drop in price reductions.
The Average Price: Last month we saw the average price of a home fall 2.2% from the prior month. This month the average price recovered and rose 1.4% from September to October. Most of us homeowners are happy to hear this.
Marketing Time: Overall market time based on closed sales rose from 41 days to 52 days from September to October. This one is a bit hard to understand. How do inventory levels fall while market time rises by such a large amount? I think it supports the idea that unless there is a consistent trend over several months, a single indicator over one month’s time means little.
Inventory Levels: The inventory level for the overall market was last reported to have increased significantly, from 2.3 months to 2.9 months. I am happy to say this momentum has stalled in November. Inventory levels from September to October drifted down from 2.9 to 2.7 months. This is another clue the market is stabilizing.
Pending Sales: The fall of pending sales reported last month has also stabilized. Pending sales remained essentially unchanged from September to October.
Conclusion: Last month I reported the overall market was showing gradual signs of weakening , moving from a seller’s market to a neutral market. This trend had been developing since March 2018. I am pleased to say that several indicators suggest that, at least for now, this trend has stalled for homes priced under $700,000. Pending sales, average price, price reductions and Inventory levels all suggest stabilization. The chart below indicates inventory levels continued to slow for homes priced over $700,000.
What price ranges are most affected by the market changes?
(Inventory=months needed to sell all existing homes at the current rate of sales.)
Price August September October November
2-300,000 1.1 1.3 1.5 1.6
3-500,000 2.1 2.3 2.6 2.6
5-700,000 4 3.2 5.2 4.8
7-1,000,000 5.7 7.7 7 8.6
Keep in mind the overall market average for November inventory is 2.7 months. These inventory numbers provide additional support to suggest that the market has really remained unchanged from September to October with the exception of the homes priced over $700,000. It continues to get just a little bit harder to find a buyer for these more expensive homes. Even for these higher priced homes it is still a neutral market. It could be worse. Hopefully next month will suggest even this price range is stabilizing.
LAND: The above Information covers the housing market. Let’s take a brief moment to see what land is doing.
The land inventory last month was at 15 months. This month, inventories rose to 19 months with a total of 438 listings and 23 solds overt the last 30 days.
It is getting more difficult to sell land. I suspect land prices will be coming down soon. In such tough selling conditions, it is wise to consider marketing land as a land/home package (a presale.) There are usually many more buyers for homes on land than raw land.
Why do I track the Market?
During the past 29 years I have been studying real estate as a full time realtor, there have been many cycles where home values rose and fell. The largest down-cycle of my career began in 2006. In September 2006, I and a partner started a speculative home priced at $600,000. During construction the market began to change. First the market just felt different and then the RMLS stats revealed the reason why it just felt different. By the time we finished building the home in February, 2007 we were growing very uncomfortable. We had no idea how severe conditions would get. We only knew the market was heading in the wrong direction. For all we knew, the market could turn around next month. We decided to be safe. We lowered the price $85,000 and got an offer quickly.
A few months later we realized we dodged that bullet but many of my clients did not. Over the next few years folks lost their homes while others struggled. The hardest hit, I believe, were the families hoping to retire and live off the equity in their homes. Many such families put their retirement plans on hold and were forced to continue working.
My goal now is to carefully track these RMLS stats and report market conditions as I see them as well as how I “feel” them. I cannot predict the future but I can provide information so you and others can make your own informed decisions.
Kelsey Family Farm : “Lily Comes to the Farm” series
Our long, dry summer was great for growing fleeces. We sheared everybody, except old Pearl whose fleece reflects her age as the most senior sheep. Her surviving lamb La Pew, has gorgeous, Gotland curls like his daddy. The fleeces were clean and soft and some of them were delivered to the mill today. We picked up scrumptious yarn from last year’s shearing which is starting to reflect the soft, fine wool we are striving for in our breeding program. Coats went on the Corriedales and we are thinking of chasing down Nick, the noble Gotland ram, and putting a coat on him. The winter rain tends to matt his fleece.
Kelsey Family Farm is an ongoing concern created by Jonell Kelsey and supported daily by her sister, Jennifer Stone, with occasional labor provided by Chris Kelsey.