Total (new and resales) Clark County July home sales (closings), which numbered 4,054 (12MMA), rose by 6.8% from July 2014. Resales saw a 7.6% Y-O-Y jump in July to 3,523, while new homes sales increased 2.0% to 531. This was the first increase in Y-O-Y new home sales in 15 months – a good sign for new housing subdivisions.
According to Home Builders Research, the 12MMA median home price (new and resale) for July was $198,196, a 7.6% jump over July 2014. The median new home price was $301,815, up 5.2% in the last 12 months. The median resale home price was $182,449 in July, reflecting an 8.7% increase during the last 12 months. The Reno average resale price for July was $266,723.
The combined rate of home appreciation for new and resale homes has slowed considerably during the last year. In July 2014, the Y-O-Y price increase from July 2013 was 19%. We believe that resale prices will continue to increase above the rate of inflation through 2015, but that this increase will be substantially less than it was last year on a moving average basis.
The prime rate remains at 3.25%. The 10-year treasury bond has remained essentially unchanged in the last month, from 2.17% to 2.16%. The 90-day LIBOR, however, has increased from 0.30 to 0.33. Compared to three months ago, the 90-day LIBOR is up significantly. Still, these rates remain historically low and benefit the commercial real estate industry in terms of the cost of borrowing. The challenge: excess capacity, especially in the office market, plus only moderate job growth.
Taxable sales in Nevada and Clark County continue to rise, thanks to increased visitation and consumer spending. Taxable retail sales hit $3.12 billion in June, up 7% compared to June 2014, on a 12MMA basis. Retail sales figures are now higher than the pre-recession highs of 2007 and continue to be encouraging for future state and county budgets. Steadily improving local, regional and national job markets are key to this improvement. This is especially true regarding the regional and national job markets since they are primary drivers of tourism spending in the region.
According to AAA, as of September 21, the average price per gallon for regular unleaded gasoline dropped by 12.3%, from $3.52 a year ago to $3.08. Between August 21 and September 21, the price of unleaded also declined, by $0.15 per gallon, or 4.5%. We expect gas prices to remain less expensive compared to last year through the end of 2015.