Jennifer Solis

(Nevada Current) The housing market in Las Vegas is cooling faster than nearly every other market in the country amid rising mortgage rates, inflation, and broad economic uncertainty, according to a new report.

According to an analysis by real estate broker Redfin, the housing market in Las Vegas is slowing faster than any other U.S. metropolitan area, second only to Seattle.

Home prices in Las Vegas were down 3% in August from the month before, and about 26% fewer homes were sold than the same two week period last year.

“These are all places where homebuyers are feeling the sting of rising home prices, higher mortgage rates and inflation very sharply. They’re slowing down partly because so many people have been priced out and partly because last year’s record-low rates made them unsustainably hot,” said Redfin Chief Economist Daryl Fairweather, in a statement. “The good news is that the slowdown is dampening competition and giving those who can still afford to buy more negotiating power.”

Rising mortgage rates are a major factor in the quick cooldown in home buying hot spots for relocating remote workers like Las Vegas, say brokers.

An influx of transplants during the pandemic caused home prices to rise rapidly in Las Vegas where the average cost of a home was $416,000 in August 2022, up nearly 35% from $310,000 in August 2020.

“The housing market has changed very quickly in buyers’ favor,” said Las Vegas Redfin agent Tzahi Arbeli, in a statement. “Not only have prices fallen in recent months, but sellers see the market cooling and they’re more open to negotiating prices, giving concessions and paying closing costs.

The top ten markets cooling fastest were almost all West Coast markets, according to Redfin. Las Vegas was followed by the housing markets in San Jose, CA, San Diego, Sacramento, CA, Denver, Phoenix, Oakland, CA, North Port, FL and Tacoma, WA.

The Redfin analysis examined changes in numerous housing metrics from February 2022 to August 2022, including prices, price drops, supply, pending sales, sale-to-list ratio and speed of home sales, to determine which markets were cooling the quickest.