Las Vegas homes that sold for cash continued to march upwards in 2013. I thought for sure this number would decrease as prices have been increasing rapidly in the Las Vegas real estate market!
In January 2013, cash buyers counted for 56.1% of all home sales. In February 2013 that number jumped to 60% but retreated back to 57% in March 2013. Hedge funds and investors are gobbling up our inventory and still have an insatiable appetite to eat up these Las Vegas homes even with increasing prices.
A myriad of hedge funds and cash buyers obviously remain in the market and still find Las Vegas residential homes a bargain even with a year to year (February 2011/2012) average sales price increases of +27.2% for single family homes and a whopping +51% for condos and townhomes. (Source GLVAR)
Number of new listings for the same time frame are down about -20% and active listings are down about -53%.
What is a financed home buyer that wants to buy a Las Vegas home to do? There are not too many alternatives with inventory at such slim pickins and rapidly increasing prices. A financed home buyer in the current Las Vegas real estate market should be prepared to write an abundance of offers before one is accepted and also be prepared to probably waive the appraisal contingency and come with additional funds out of pocket. That is if they want a home NOW. If not, it is probably wise to ride this out and wait for more inventory.
The other problem remains for the financed buyer – we are slightly increasing with inventory and that is only due to higher listing prices – not due to larger amounts of distressed inventory that many so called experts have been predicting. Even cash buyers putting reasonable offers in on homes are losing out to other cash buyers. Now more than ever, savvy Las Vegas home sellers do not want to take chances on an appraisal coming in low and they do have their share of cash buyers to pick from so financed buyers, contract subject to an appraisal, will lose time and time again.
Las Vegas home sale prices are rapidly increasing and as they approach $100/SF, I still maintain my prediction that we need to see home prices around $130/SF before we see some significant inventory to hit the market. This or rising interest rates for financing will make the cash buyers retreat and is our glimmering hope for buyers to find a home to buy.
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