Las Vegas homebuilders struggled during the first two months of 2011 and aren’t showing much optimism for a quick recovery in the market.
Sales of new homes fell 19 percent in January and February compared to 2010, while sales of existing homes rose 1 percent as prices continued to fall, according to a report released Monday by SalesTraq.
Buyers closed on 502 homes in January and February, down from 621 in the first two months of 2010. The 269 sales in February are up from 233 in January, but it’s still below any month in 2010.
At that pace, builders wouldn't sell more than 4,500 new homes after selling 5,438 in 2010. Builders took out 469 permits in the first two months of 2011. That’s a 37 percent decline from the first two months of 2010, when 744 permits were issued.
“For those who hoped Las Vegas would enjoy a speedy housing recovery, February data will come as a major disappointment,” said housing analyst Steve Bottfeld, executive vice president of Marketing Solutions who works with SalesTraq on releasing the data. “Nearly every facet of the residential market is at or near the bottom. And there are only one or two very faint glimmers of hope for the future.”
New home sales have slowed significantly since the federal tax credit ended in the spring of 2010. Builders took out 3,776 permits in 2010 and at this pace would take out about 2,500 for the year.
Even a drop in price didn’t trigger more sales.
The median price of new homes sold in February dipped to $188,900, a 9.2 percent decline from February 2010. That’s the lowest price since it was $188,000 in June 2010 when the tax credit ended.
Prices haven’t been this low since November 2002, SalesTraq reported.
The average price per square foot for new homes sold in February was $98.16, down 6.1 percent from February 2010. It’s the first time the price has dipped below $100 per square foot in several years, analysts said.
In the existing home market, the 3,616 sales in February were 1.1 percent lower than February 2010 but for the first two months of the year, the 7,401 sales were 71 more than the first two months of 2010.
Median prices of existing homes, however, fell 5.4 percent to $110,000 compared to February 2010, when it was $116,250. The $110,000 price is $1,000 higher than it was in January.
Existing home prices haven’t been this low in Las Vegas since the early 1990s.
The average price per square foot of existing homes sold in February was $73.28, a 4 percent decline from $76.49 in February 2010.
Only 22.5 percent of existing home sales in February were traditional ones between an owner and buyer. Some 45.5 percent were foreclosure sales and 10.3 percent were auction sales. Another 21.7 percent were short sales in which the bank allows the sale to go through even though the owner owes more on the mortgage than the home is valued.
Those homes sold at auction went for a median price of $86,500. Foreclosure sales netted $106,000, while traditional sales changed hands for a median price of $115,000. The median price of short sales was $120,000.
Bank repossessions fell to 943 in February, the fewest since 899 were taken back in February 2010.
SalesTraq will unveil its March numbers at its Crystal Ball housing seminar April 21 at the Alexis Park hotel. It will feature Las Vegas Mayor Oscar Goodman and Frank Wyatt, president of Pinnacle Homes and president of the Southern Nevada Home Builders Association.
For more information, go to www.crystalballseminars.com.