Is the LV market overpriced?
Local real estate observers are disputing the findings of two national analysts who claim the Las Vegas market is overpriced. They believe the findings of the national analysts forget to take into account Las Vegas’ strong job market.
However, both the Local Market Monitor and a joint survey by Global Insight and National City Corp. report that Las Vegas is overpriced. Ingo Winzer, president of Local Market Monitor reports that the average home price of $296,500, is 28% above the $231,000 average that he said economic fundamentals warrant. The Global Insight survey states that home prices, at a median of $282,600, is 41.8% higher than it should be.
The chief economist for National City takes note of Las Vegas’ higher-than-average rates of unconventional mortgage products, such as interest-only loans and option adjustable-rate mortgages, and a higher-than-average share of investors. Indicators, he believes, that are “symptoms of speculative elements. These same indicators may soon drive home prices lower in Southern Nevada as the need to turn over financed homes increases.
Source: The Las Vegas Sun.
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