After more than three decades of selling real estate in Southern Nevada, Merri Perry has assumed the role of president of Las Vegas Realtors, effective January 1.
Vegas Inc sat down with Perry to talk about the state of the real estate market in Las Vegas, the effect of relatively high interest rates and what she indicated could be the most critical issue facing Las Vegas’ real estate market: a shrinking housing supply.
How would you summarize the Las Vegas real estate market in 2023?
As we wrap up 2023, the local housing market was as stable [as] it has been in years. Like most housing experts, we expect similar conditions in 2024. Though [National Association of Realtors] experts expect home sales could increase somewhat in 2024, especially if mortgage interest rates moderate, and we just had a nice interest rate drop in the past couple of weeks. … Nevada home and condo prices are up slightly from last year at this time—just a little bit.
What challenges or advantages were there to the real estate market in Las Vegas in 2023?
It was really bad that interest rates skyrocketed like they did because home prices have increased a lot and it really hurts first-time homebuyers and veterans. So it’s really good that the interest rates just started coming down. Inventory is still a major issue for us.
Can you elaborate on that?
Well, sales are down. We sold fewer homes in November than we did during the same month last year, but we have less inventory. A lot of people are staying in their homes longer because they’re afraid of the interest rate. So they’re going to sell, but then they’re going to have to buy another property and the interest rate’s going to be so much higher, so they stay in there longer.
We sold fewer homes in 2022 than we did in 2021—but in 2021, we had a record year. We sold more than 50,000 properties in 2021. So inventory is a major issue for us. … We have under a three-month supply and last year we had a four-month supply. So that’s the big difference. We need more builders to sell more homes. And obviously we need more homes to be sold on the market.
What are the solutions to existing problems in the market?
Well, I’m showing a property today [to] a first-time homebuyer that’s been waiting. So interest rates are helping, but people have to understand that there’s more inventory now—there’s more choices—but when the interest rate goes down, it’s going to be less inventory for these buyers. And you could always refinance a home but you have to get into a home.
Even with high interest rates and a tight supply, people [are] still able to buy homes and build wealth over time. And buying is still a better deal than renting for most people. Because when you rent, you don’t know what your payments are going to be in six months after your lease is up. You don’t know if they’re going to throw you out and you can’t write off the interest.
But when you own a home, you gain generational wealth through the home going up in value.
You could always buy down the rate. … So, when the interest rates start plummeting and you have way more buyers on the market, there’s going to be no chance of negotiating or even fixing up a property.
In 2021, my clients [were] just buying whatever, as is. Now, I can go in there, I can negotiate deals, closing costs, price and fixing up the property. So, now’s the time.
How does Las Vegas’ real estate market compare nationwide?
It depends on which state. A lot of people are moving here from California, just because of the cost of living.
But we’re getting all the sports here. [Miriam] Adelson just bought the [Dallas] Mavericks. We have the Oakland A’s coming. We have [Formula 1]. I mean, what don’t we have here anymore?
Ten years ago is a different story. Look at our Golden Knights. Our Raiders are kicking butt now. So, we’re a one-stop shop here and we’re supposed to be getting all the Hollywood people coming here.
What’s your prediction for 2024?
They’re saying it’s going to be about the same. NAR is expecting home sales to increase somewhat if interest rates stay moderate. So, it just all depends on the interest rates. I mean, if they’re going to continue to go down, people are going to start getting off the fence. That’s why it’s so important to work with a Realtor, because we can negotiate those interest rates through closing costs.
What would you say to aspiring homebuyers?
You never get rich renting. You’re making your landlord rich. To gain generational wealth, you must own a home. And I’m not a tax consultant but I absolutely know, for sure, that you can write off your interests when you make your mortgage payment.
And then you don’t know what’s going to happen—I mean, you heard the crisis of rentals a couple of years ago. No one could afford rentals. They were asking for four months upfront cash—above what it’s worth—I mean, they just went crazy.
Click HERE to subscribe for free to Vegas Inc’s BizClick newsletter. Stay up to date with the latest business news in Las Vegas sent directly to your inbox each Monday.