Virus shouldn't crash Las Vegas home prices, economist says
While much is unknown about how badly the coronavirus pandemic has damaged Southern Nevada's economy, one economist doesn't foresee a major housing market crisis here.
Mark Vitner, a senior economist for Wells Fargo and Co., said he thinks the area's housing market will pick up steam quickly once Las Vegas' tourism-based economy rebounds.
In mid-March, Gov. Steve Sisolak ordered casinos and other nonessential businesses statewide closed for 30 days and later extended the shutdown through at least the end of April.
Las Vegas was one of the hardest-hit places in the United States during the Great Recession, largely because of a severe housing market crash.
"I don't think there are the supply issues that we had say 10 or 12 years ago," Vitner said.
"We've seen a lot of young people in Las Vegas who wanted to live in a more urban environment, so we've seen a lot of apartment development. That's probably going to slow a good bit more than the single-family market is," he said.
For March, the median price of an existing house in the Las Vegas Valley was $319,000, an all-time high, according to the the Las Vegas Association of Realtors.
During the recession, the median price bottomed out at $112,000 in 2012.
"As far as housing taking a hit, the truth is that none of us know," said Tom Blanchard, president of the association. "The best guess that any of us can give is that the current activity levels do not indicate the kind of fallout that we saw from the meltdown of 2010."
The real estate business has been allowed to continue during the shutdown with some restrictions, including a ban on tours of renter-occupied properties and an emphasis on handling paperwork electronically.
"As far as activity, we took a hit initially. Activity has picked up since then," Blanchard said."We're accommodating people the best way we can."
Vitner said he expects people from California to continue to gravitate to Las Vegas in search of more affordable housing and the market here to remain stable.
"Price appreciation will be slow, but we're not looking for outright price declines on a year-to-year basis," he said, although "we might see people coming down from their asking price from three months ago."