Explaining the Rising Home Prices in Las Vegas

High-paying investors and a shortage of supply have raised median single-family home price by 32.8% year-over-year in Las Vegas. Home prices could be surging because renters are apprehensive about the limited supply, which only meets a five-week demand (a normal housing market has a sixth-month inventory).

Additionally, new local laws dictating that banks are now subject to more transparent mortgage and foreclosure practices make it harder for banks to foreclose and also contribute to the price rebound. There were over 4,000 foreclosure notices in Nevada in September 2011, while there were only 80 foreclosures in October after the bill passed. With the reduction in foreclosures, fewer homes are being pushed to the market, further limiting supply and increasing home prices.

This rise in home values allow people who are “underwater” on their mortgages to sell. Indeed, the percent of mortgage owners who are underwater has dropped from 70% to 50% since 2010.

Read the full article at NPR