The Las Vegas Valley is fifth in the country for median home sale price drop year over year, according to a new report.

Redfin’s latest monthly report, which looks at home sales through May 3, shows Las Vegas home prices dropping 2.5 percent, which puts it behind Newark, New Jersey (3.3 percent); San Jose, California; Seattle and Dallas (all dropping 3.2) for top in the country. Home prices increased the most in San Francisco (11 percent) and Cleveland, Ohio (8.2) year over year, the report stated.

Redfin and Zillow’s median sale prices for the valley are lower than numbers provided by trade association Las Vegas Realtors, which has it at $473,875, just $15,120 off their reported record high. Redfin has the median sale price at $449,000 while Zillow has it at $426,069.

The valley’s residential real estate market has been on a never-ending roller-coaster ride since the Great Recession, going through more ups and downs than most American cities. Daryl Fairweather, the chief economist for Redfin said this all comes down to casinos and gaming driving the city’s economy and it’s low regulatory burden regarding construction.

“Las Vegas has always had volatile home prices because its economy is so sensitive to changes in consumer spending, and because it’s relatively easy to build homes there when demand is high,” she said. “Now that demand is down, and there is still leftover inventory from the pandemic building boom, Las Vegas is in the correction phase.”

Fairweather added the overall U.S. housing market is going through a bit of a slump due to a number of factors.

“Americans are spending less money on travel, dining out and other discretionary expenses as they cope with rising gas prices and continued economic uncertainty,” she said. “That’s hurting Las Vegas’s tourism-driven economy and keeping potential homebuyers who are worried about losing their jobs from making a major purchase like a home. It’s also preventing local homeowners from listing because most sellers are also buyers, and they’re reluctant to give up the low mortgage rates they locked in years ago for today’s much higher borrowing costs.”

Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.

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