Prices continued to fall in Clark County’s housing market in September, but high interest rates and low inventory are keeping homes out of reach for some prospective homebuyers.
The average sale price for homes in Clark County fell 3.5 percent last month, from $605,300 in August to $584,000 in September, according to the most recent Regional Multiple Listing Service report. This downward price trend is unsurprising as the housing market continues to normalize, said Windermere Northwest Living broker Mike Lamb.
What is more notable, Lamb said, is the slow listing activity last month. RMLS reported just 747 new listings in September, down 8.1 percent from August. That is the weakest September listing activity since 2012, Lamb wrote in his Clark County Market Report.
“That amount of listing activity is weak, and I think that’s the most significant thing,” Lamb said. “Because we’re still very short on inventory, and it is certainly restricting sales.”
Lamb’s report found there were just 1.58 months of standing residential inventory available last month in the county, meaning it would take that long for all houses on the market to sell if no new listings were added. A healthy market is generally considered to have four to six months of inventory.
Low inventory with few new listings means people searching for homes have few choices. “Most of the brokers I know have buyers that have been waiting for something to come up to buy,” Lamb said. “There are still buyers that want to buy something, but that house they want has not come on the market.”
This, in turn, has led to a low number of pending sales. There were 860 pending sales waiting to close at the end of September, down 14.6 percent from August. “We would have had more sales if they had something to buy,” Lamb said.
For buyers who can find the right house, Lamb thinks it is a good time to buy.
“If there is inventory, it’s a much better environment to buy in now because there’s not this same level of competition there was,” he said. “We were seeing houses sell for more than they were really worth. And now what we’re seeing is sort of a return to a more of a normal type of market.”
Meanwhile, interest rates for 30-year fixed mortgages have risen to nearly 7 percent – the highest rate in 20 years, according to the government-sponsored home mortgage packager Freddie Mac. Despite falling prices, these high rates mean homebuying can still be too costly for some.
Fortunately for prospective homebuyers, Lamb does not foresee these high interest rates lasting indefinitely. “I’ve been doing this 42 years, and what I can tell you is, rates change,” he said. “They’re up high now. A lot of the people that I’m reading are saying this is a relatively short-lived phenomenon.”