The Las Vegas Valley has been identified as the 27th most affordable metro area in the United States when comparing home prices to income. The median household income in the area stands at $75,065, while the median home price is $449,000. To afford an average home with a 20 percent down payment, a household would require an annual income of $113,839. Without a down payment, the needed income rises to $138,826.
Robert Little from Re/Max Advantage in Henderson notes that various factors have influenced these financial dynamics. Despite higher mortgage rates, there has been a slight price softening, making the market somewhat more favorable for buyers. This has led to increased inventory, though prices remain near record highs. Little suggests that the market may be undergoing a correction, allowing for potential price negotiations and seller concessions.
Builders have responded to market pressures by offering incentives such as covering closing costs or providing rate buy-downs to attract buyers. Economic concerns, particularly inflation and potential recession, have been heightened by recent tariff policies. The 30-year fixed mortgage rate was at 6.8 percent as of May 20.
Matt Hennessy, a mortgage adviser in Las Vegas, highlights the ongoing economic volatility, particularly following a credit rating downgrade by Moody’s, often linked to governmental fiscal debates.
The Clever Real Estate study indicates that only Detroit and Pittsburgh are currently deemed affordable among the 50 largest metros. Iowa is the only state considered affordable. The study emphasizes that while home prices are a major factor in housing affordability, property taxes and insurance costs are increasingly significant. To afford the median-priced U.S. home of $438,000, a household income of $123,226 is needed, yet the median income is only $77,719, illustrating a significant gap.
