Inventory is up and prices are rising as we start 2019. If you buy a home now, you can build up a considerable amount of equity over the next five years.

As we look back on our 2018 market and look ahead to 2019, there are some important facts and trends buyers and sellers should be aware of.

Overall, 2018 saw a lot of changes. We went from a market filled with multiple-offer situations and then transitioned into more of a softer market we see today. This softening might seem scary to some, but we have a lot of positive indicators moving forward in 2019.

By this time last year, there were 36,174 year-to-date home sales in the Las Vegas area. This year, there have been 33,116 home sales. This slight drop-off has contributed to the increase in inventory we’re seeing. Last year, there were 4,538 homes available, but this year there are 7,003.

Despite this increase, we aren’t seeing many more new homes come on the market. Last year at this time, 41,362 new homes had come on the market. This year, 42,635 new homes have come on the market. Last year, the median sale price of units sold was $251,710, and this year that number is $286,410—a 13.8% increase.

In addition to this increase in pricing, rising interest rates have also contributed to this buyer slowdown. Right now, I’m hearing a lot of buyers say they want to wait until the next market crash to make their move. As I’ve said before, I don’t believe a crash is imminent for our market. We may see a market correction, but nothing like what we saw in 2007 and 2008. Lending standards are different now, and they’re much more protective of homebuyers.

"Instead of paying your landlord’s mortgage and lining their pockets, why not buy a home and start building your wealth?"

Zillow recently commissioned a study through PulseMetrics that asked 95 economists, market analysts, and real estate experts what their predictions were for 2019, and almost 94% of them predicted that home prices would appreciate in 2019. Only 4% expected prices to depreciate, while 2% expected them to stay the same.

Of those polled, the majority thought our market would increase by about 23% over the next five years. Those who are less bullish about our market thought it would increase by about 20.7% during the same span.

What does this mean for you? If you bought a $300,000 house today, based on the amortization of a standard conventional loan, you would build up $25,000 worth of equity in five years if the market didn’t change. A market increase of 20.7% over the next five years, however, would result in you building up $62,000 worth of equity if you bought the same $300,000 house.

Considering interest rates are in the high 4% to low 5% range, what you could buy a house for and what you would pay in terms of a monthly mortgage is still less than or equal to what you’d pay in rent for the same type of property. Instead of paying your landlord’s mortgage and lining their pockets, why not buy a home and start building your wealth?

If this sounds like something you’d be interested in, don’t hesitate to give me a call so I can help you get started on your home buying journey.

As always, if you have any other questions about our Las Vegas market, feel free to reach out to me as well. I’d love to help you.