⚡️ Market Pulse - Vegas vs. Nation: 🏡 Inventory Opposites

For the week of March 27, 2023

Mar 27, 2023

“I would give a thousand furlongs of sea for an acre of barren ground” - Shakespeare

📈 FEBRUARY HOMES SALES SURGED UP 14.5%
📈 BUILDERS POST 3RD CONSECUTIVE GAIN IN NEW SALES
📉 VEGAS INVENTORY CONTINUES ITS DECLINE
🏦 FED RAISES 25 BPS, PAUSE IMMINENT?

😎 TIP OF THE WEEK: BY THE #S - WHY SELLER’S SELL

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We hope you enjoy this edition of the ⚡️ market pulse. Our goal is to analyze and keep you informed on the economy and real estate market so you can make better, informed decisions. We’re here to help you with your real estate needs (residential, commercial & investments) when you’re ready.

Call/text us at (702) 721-7332 or e-mail Jordan@DoveandAssociates.com

WATCH ON YOUTUBE

Traders were feeling pretty confident last week, taking their cue from Alfred E. Neuman's trademark motto, "What, me worry?" and pushing stock prices north, despite another rate hike from the Fed and continuing banking-sector worries.

And you know what? They were right to be confident! The Fed raised rates a quarter percent, but they also made it clear that they don't expect any major changes in the near future. Plus, they called the U.S. banking system "strong and resilient.” Do we believe them?

In fact, there's plenty of good news to be excited about. Wall Street loved the rise in home sales and mortgage applications, and reacted accordingly. Builders stocks were up and purchase applications were up. And, initial jobless claims stayed at a low level, showing that the labor market is still going strong.

The Dow finished the week up 1.2%, to 32,238; the S&P 500 is up 1.4%, to 3,971, and the Nasdaq is up 1.7%, to 11,824.

Even bond prices were up overall, with the UMBS 5.5% up 0.78, to $101.07. And in Freddie Mac's Primary Mortgage Market Survey, the national average 30-year fixed mortgage rate continued to slide down. Buyer’s monitoring the rates seem to jump in each time there is a dip in the 30-year fixed mortgage.

Of course, it's always important to remember that mortgage rates can be volatile, so make sure you stay up-to-date by talking to a mortgage professional.

If you're not paying attention to what's happening right now - don’t miss out! I’m here to provide you what’s happening in the national real estate market.

Let's dive into the numbers. February existing home sales surged up, and I'm not talking about a small increase here. We're talking about a 14.5% increase, baby! That's huge. Plus, the median price fell year-over-year for the first time in 11 years. That's a clear sign that buyers have the upper hand in this market.

And that's not all, folks. New home sales are up for the third straight month, and inventories are increasing rapidly (nationally - not in Southern Nevada). The opportunities buyer’s missed out on during the pandemic are now having a chance.

Something that really caught my attention is the numbers on down payments and cash buyers. An online real estate database reports that the median down payment percentage has dropped from 13.6% a year ago to just 10% of the purchase price.

And get this, the share of cash buyers has climbed to 32.1%. That means people are putting their money where their mouth is, and they're confident in the market versus other asset classes.

DID YOU KNOW… Realtor.com reports that the best time to list a home in 2023 will be the week of April 16-22. Based on trends from prior years, sellers can expect higher prices, more buyers, and less time on the market. Call/text us at (702) 721-7332 and interview our team of professionals to get your home sold.

Sales remain steady while inventory continues falling keeping the Southern Nevada market at an elevated Absorption Rate Figure

Current ARF:
40.56% 🤯

The current absorption rate for the Southern Nevada market the past 30 days is 40.56%, up 0.12% (12bps) from the last absorption rate reading on March 20, 2023 (40.44%).

There is about 2.40 months of inventory available on the Southern Nevada housing market. Historically, 6 months of inventory is considered an even buyers & seller’s market, although we at D&A believe that 4 months is an even buyers & sellers market.

A market with an absorption rate at or above 20% is typically called a seller’s market, whereas an absorption rate below 15% signals a buyer’s market. 15-20% in considered an even market.

Each week we will update the current median price for the current month. Keep in mind the majority of sales occur at the end of the month, so official numbers will be published on the first Monday of each month. Median prices are of 2,207 sold listings from the MLS as of March 27, 2023.

Currently for the month of March 2023

Single Family
$424,825
-$165
Down from February of $424,990

Condo
$225,000
+$5,000
Up from February of $220,254

Townhomes
$315,000
+$5,500
Up from February of $309,500

Southern Nevada housing inventory continues its slide whereas national inventory continues to rise.

Month-over-month, inventory has decreased 9.33% whereby sales increased 2.14%. Prices decreased dipped as there were 185 less compared to one month ago, a decrease of 24.76% which may be a sign that price decreases are starting to soften. This trend has been going this way for many weeks which may potentially signal a coming bottom of the market in the near future if inventory levels remain low.

There are currently 6,468 active single family homes, townhomes, condominiums, high-rises, manufactured and multi-families available on the market. Available rental properties also dipped down to 3,076 active rentals on the market this week.

As of March 27, 2023, there are currently active (4w change):

4,621 Single Family Homes (-555) -10.72%
725 Condos (-21) -2.81%
491 Townhouses (-40) -7.53%
242 Manufactured Homes (-14) -5.47%
334 High Rise Units (-16) -4.58%
55 Multiple Dwellings (-11) -16.67%
2,513 Parcels of Land (+1) +0.04%
3,076 Rentals On Market (-168) -5.18%

Past Seven Days Market Watch (4w change):

718 New Listings (+14) +1.99%
191 Back on Market (+12) +6.70%
56 Price Increases (-4) -6.67%
562 Price Decreases (-185) -24.76%
848 Accepted an Offer (-55) -6.10%
616 Sold (+13) +2.14%
96 Expired (-18) -15.79%
285 Taken Off Market (-54) -15.93%

This week, there are 102 less active residential resale properties on the market compared to the last read on March 20, 2023 for a total of 6,468 - a decrease of 1.55%. The month/month change from February 27’s reading is a decrease of 9.33% in available inventory.

PENDING HOME SALES, HOME PRICES, INFLATION… After a January bump, the Pending Home Sales index of signed contracts on existing homes is expected to recede in February. The S&P Case-Shiller Home Price Index is forecast to report price increases declining again in January. PCE Prices, the Fed's favorite measure, should show inflation continuing to slow.

If you’re on the fence about selling your house, it’s worth considering all the reasons why moving could make sense for you.
If you find your home no longer meets your needs, it may be time to sell.
You have a lot to consider when deciding if you should move. Let’s connect today to go over the benefits of selling your house.

Forecasting Federal Reserve policy changes in coming months. The futures market expects the Fed to hold the current rate through the next two meetings, then do a quarter percent rate cut in July. Note: In the lower chart, an 11.3% probability of change is an 88.7% probability the rate will stay the same. Current rate is 4.75%-5.00%.

AFTER FOMC MEETING ON: CONSENSUS
May 3 4.75%-5.00%
Jun 14 4.75%-5.00%
Jul 26 4.50%-4.75%

Probability of change from current policy:

AFTER FOMC MEETING ON: CONSENSUS
May 3 11.3%
Jun 14 24.1%
Jul 26 91.9%