For those who like to point to the Las Vegas market with “We hear sales are up”, the median resale single family home in Las Vegas sold for $162,999 or $96 per foot in December, according to Home Builders Research, Inc.
This number makes the 15 resale homes closed during the entire fourth quarter in Mesquite look pretty good at an average price of $248,027 or $143 per square foot. Unfortunately, this price is over 25 time’s fair market rent and over five times Mesquite median annual income, not good signs.
Realistically, the Vegas number is most likely a glimpse into the 2009 Mesquite Market numbers. The storm of foreclosures is on Mesquite’s horizon and moving in fast.
Mesquite MLS shows 25 new homes closed during this past quarter with an average price of $293,151 or $158 per square foot.
Sun City Mesquite had only 10 closings reported through the Mesquite MLS for the entire fourth quarter, and without adjusting for incentives the price averaged $145 per square foot or $240,827.
We closed 14 town home units averaging $129 per square foot and none above $300,000.
With nearly 100 active condo units for sale, only 5 sold and closed in the last 90 days of 2008.
The term “sticky prices” is clearly in play, but the buyers are not buying it. In other words sellers have yet to really drop prices and buyers are waiting.
No commercial sites or commercial buildings closed during the fourth quarter 2008. By my estimate there may be as much as 300,000 square feet of vacant commercial/industrial space, yet 19 new commercial building permits were taken out during 2008. Many will require new permanent financing this year and it will be a real challenge for some given the current credit markets and vacancy rates.
The residential vacant land super pad or subdivision market has gone from bank foreclosures to FDIC owned through bank failure and seizure in some cases. Based on 378 new home building permits issued for the year of 2008, including Sun City there is over a 20 year supply of building lots. These values in some cases look like they may have fallen as much as 80% from 2005 prices.
All total including every residential category we closed 311 units during 2008 compared to 706 during 2005, that is 56% less sales. At the same time inventory of listed property for sale reached an all time high with over 400.
Another telling sign in the market is the failed listings during 2008, they reached 764. They went out of active inventory as expired, canceled, or withdrawn. The problem is that they are still out there and many are vacant or due to negative cash flow, must be sold.
2009 should be a year of opportunity and challenge.
Please remember if you are planning a visit and would like to discuss the Mesquite Market call ahead to let me know you are coming so we can schedule a few minutes.
Chris W. Miller
ERA Brokers Consolidated
Mesquite NV 89027