WHY LENNAR’S YEAR-END STRATEGY IS SIGN OF WHAT’S TO COME IN THE 2021 NEW HOME MARKET
November 22, 2020
And Why it’s a Sign Las Vegas is NOT in a Housing Bubble
What a difference a year makes.
After a soft start to the year, the housing market exploded over the summer with record sales even under the cloud of the Covid-19 pandemic, beating most analysts’ expectations.
National new home builder, Lennar, is expected to offer much less than previous years to potential buyers.
Keep in mind Lennar, along with many other major builders, are purchasing more land and planning new communities to keep up with expected demand for 2021.
In other words, Lennar is offering fewer incentives to buyers while going gangbusters on building new homes. This strategy stays in line with current expectations that inventory will remain low, Las Vegas housing demand will be high, interest rates will remain at record lows, and new buyers from other more populated metropolitan areas will be leaving their hometowns for Las Vegas. All that means we expect prices to continue to rise in 2021; albeit at a slightly slower pace than we saw over the summer.
WHY THIS MEANS LAS VEGAS IS NOT IN A HOUSING BUBBLE
A recent article in the Las Vegas Review Journal referenced the robust Las Vegas real estate market and asked if we were in a housing bubble, taking into consideration the hit The Strip is taking during the pandemic. The short answer is no, according to experts quoted in the article.
These two economic dichotomies represent that those who are not directly affected by unemployment and who have the financial means are jumping into the market now to take advantage of relatively low housing prices, compared to other US Cities. So, with strict rules for financing compared to the bubble Las Vegas experienced a decade ago and our overall low inventory, Las Vegas is not experiencing a bubble. But perhaps, the market will slow down in overall month-over-month appreciation in 2021-2022.
What does this mean for you? Lennar is one of many builders developing brand new home communities yet to start construction but still pre-selling the first phases of these residences even though they haven’t broken ground yet. Now is the time to lock in a pre-grand opening price on a brand new home before builders like Lennar raise prices at their official grand opening and after phase releases.
Our recommendation: Don’t wait to buy that new home now before they’re gone and prices go up even further for later phases.
Learn more about new communities by Lennar.