THE BOTTOM LINE…The relationship between supply and demand in the Las Vegas housing market appears to be more balanced today than at any time since the boom-bust cycle began. While this is not to suggest market conditions are ideal, it does indicate that pricing has remained relatively stable in recent months and more in line with incomes. At the same time, supply conditions have moved toward more healthy levels. Effective levels of availability in the Multiple Listing Service (MLS) have risen to 3.3 months. With approximately 8,600 available units and a reduced pace of closings through the MLS, the environment has improved for those seeking homes. Another key contributor is the reduced number of sales to investors; approximately 60 percent of sales in the first few months of 2013 were to cash buyers, and that figure has dipped down to 44 percent of sales in the MLS. Most telling is the mix of homes that are being sold in the resale market. In October 2013, non-distressed (or equity) sales accounted for 70 percent of all sales, or 7 out of every 10. That figure stood at 45 percent of all sales 12 months ago and a modest 26 percent 24 months ago. To be clear, the market has some dark clouds looming on the horizon, including significant mortgage delinquency and potential investor divestures, but if asked, the REALTOR® community would likely suggest that conditions are getting better as opposed to worse. Price gains over the past 18 months have allowed hopeful home sellers to exit outside of short sale situations, and the market has emerged stronger. While not necessarily a question of health, the key measurement for the coming year will center on sustainability and the prospects for supply and demand conditions to remain aligned particularly if cash buyers begin to exit the market, whether by choice or necessity.

New Home Closings:  The number of new home closings held relatively flat (-.05 percent) compared to the same month of the prior year at 577 sales. During the past 3 months, sales volumes are up 7.8 percent, and during the past 12 months, they remain up 47.4 percent.

New Home Pricing:  Pricing within the new home segment remains elevated as the median price reached $289,521 in October 2013. Compared to one year ago, prices are up 34.0 percent and reflect the first month-to-month gain of any size (+$21,665) since the April to May jump of $17,372 and the May to June increase of $11,160. Median prices essentially stabilized in the June to September timeframe. On a per-square-foot basis, new home prices reached $128, representing a 22.8 percent increase.

New Home Supply:  The number of new home construction permits pulled in October was up slightly from September and slightly ahead of the 12-month average (587 vs. 566). The top 10 most active builders included: DR Horton (95), Lennar (78), Beazer Homes (71), Ryland (38), American West (34), KB Home (32), Richmond American (29), Harmony Homes (25), William Lyon (25), and Woodside Homes (24).

Existing (Resale) Home Closings:  During October 2013, a total of 3,976 resale units changed hands. Closing volumes are slightly off the prior year (-6.6 percent). During the past 3 months, closings are off 2.8 percent and for the past 12 months they remain down 8.9 percent.

Existing (Resale) Home Pricing: Pricing within the resale market pushed north to $157,500 during October 2013 following a three-month stall in the $155,000 range. Compared to a year ago, the median price was up 27.0 percent, and on a per-square-foot basis, the average price was up 31.6 percent to $105.

Resale Availability (MLS Listings): Availability in the resale market appears to be treading water in recent months, hovering in the 8,000-unit range. However, in recent months, the number of homes being sold through the Multiple Listing Service (MLS) is pulling back, resulting in rising effective availability of 3.3 months (more than two times the 1.3 months reported one year ago).

Bank Foreclosures (Repossessions): Bank repossessions totaled 347 during October, which was 32.4 percent higher than October of the prior year. Despite the recent uptick, foreclosures are down 47.4 percent on a year-to-date basis.