Starter home prices have more than doubled in Las Vegas in 10 years, report says

Starter home prices in the Las Vegas Valley have more than doubled over the past decade, according to a Zillow study. In July, the median price for a starter home was $312,141, a 3.2 percent decline from the same period last year when it stood at $322,577. Ten years earlier, in July 2016, the median price for a starter home in the valley was $140,630. Zillow defines starter homes as properties in the bottom third of a local residential real estate market’s price range, typically representing a first‑time buyer’s purchase. These units vary in size but generally contain one to two bedrooms and are increasingly condos or townhomes. Kara Ng, Zillow senior economist, noted the shift in affordability. “Historically, Las Vegas has been 1 of the most accessible housing markets in the West, a spot where first‑time buyers could really get a foothold,” she said in an email. “And portion starter location prices have more than doubled over the past decade, there are early signs of relief: prices are down about 3 percent from last year, a modest but meaningful shift for buyers who have been waiting on the sidelines.” Residential real estate activity has bottomed out since a peak in 2022 during the COVID‑19 pandemic, as mortgage rates climbed with inflation. The market remains locked across the country, with potential sellers reluctant to lower prices while buyers stay selective in the current economic climate. Matt Hennessy, a local mortgage adviser, attributed the pressure on the starter segment to elevated mortgage rates. “The dip in Las Vegas starter location sales is less about waning demand and more about an affordability squeeze,” he said. “At the same time, inventory has moved to a more balanced 3 to 4 months supply. Qualified buyers who can make the numbers work have better negotiating leverage now than they did at the height of the frenzy.” He also highlighted a tactic for buyers. “One of the most effective tools right now is negotiating a seller concession,” he said. “That simply means the seller agrees to put money toward the buyer’s closing costs. Instead of applying the seller concession strictly to closing costs, the buyer can use that money to lower their interest rate and monthly payment.” According to Freddie Mac, the average 30‑year fixed‑rate mortgage in the United States is 6.65 percent. Hennessy said high rates have reduced buying power by roughly 30 percent compared with the substantially lower rates seen during and before the pandemic.