Las Vegas pending home sales fell 20.6 percent year over year, the fifth-largest drop among major U.S. metros, Redfin says

What happened

Pending home sales in Las Vegas dropped 20.6 percent compared with a year earlier during the four weeks ending Oct. 18. The figure comes from a Redfin report covered by the Las Vegas Review-Journal. It was the fifth-largest decline among major U.S. metro areas, and the Review-Journal reported that affordability problems continued to weigh on buyers.

The report also placed Las Vegas among the five metros with the sharpest drops in new listings. According to Redfin, new listings in the valley fell 8.4 percent over the same four-week period.

How Las Vegas compares

The steepest declines

Redfin found that Seattle posted the largest drop in pending sales in the country, at 28.8 percent. San Diego followed at 25.4 percent and Atlanta at 23.8 percent. Denver also ranked ahead of Las Vegas, though the Review-Journal did not give Denver's figure.

The national picture

Across the country, pending sales kept falling as the typical monthly mortgage payment rose to its second-highest level on record, according to Redfin. The number of homes newly coming onto the market shrank. Total housing inventory kept growing, though only modestly.

Prices hold near record highs

The Review-Journal reported that home prices in the valley have stayed relatively flat but remain close to record highs set earlier this year. According to the trade association Las Vegas Realtors, the median price of a single-family home sold in October was about $475,000.

That figure was up 1.1 percent from September and 0.1 percent from October of last year. Las Vegas Realtors draws its resale market data from the Multiple Listing Service. For more on last month's numbers, see our earlier brief on October home prices and slowing sales.

What economists and Realtors are saying

Redfin: rates keep buyers on the sidelines

Redfin chief economist Daryl Fairweather said affordability is the biggest challenge for the Las Vegas market and for markets across the country. "Mortgage rates have increased above 7 percent, and many would-be buyers are waiting on the sidelines," she said, according to the Review-Journal. She added that buyers still in the market have more homes to choose from and more negotiating power than at any time in over a decade.

Local and national views

Las Vegas Realtors President George Kypreos said in an earlier statement that mortgage rates continue to play a large role in the local market, the Review-Journal reported. In Zillow's October market report, chief economist Mischa Fisher said mortgage rates entrenched above 7 percent are sharply slowing home sales nationwide.

A separate Zillow report for September found that Google searches for the phrase "can't sell house" had reached an all-time high. The Review-Journal described that as another sign of the difficulties homeowners face in the current market. More local housing coverage is available in our real estate section.

What to watch next

• Whether mortgage rates come down. Redfin's Fairweather said many would-be buyers are waiting for lower rates or more certainty about where the economy is headed.
• Whether overall housing inventory keeps growing. Redfin reported that inventory continued to rise modestly even as new listings fell.