A recent study by Clever Real Estate has revealed that the Las Vegas Valley ranks as the 27th most affordable metropolitan area in the United States when considering the ratio of home prices to household income.
The median household income in the valley is reported at $75,065, while the median home price stands at $449,000.
This discrepancy means that to purchase an average home with a 20% down payment, a household would need a yearly income of approximately $113,839.
If buyers are unable to make a down payment, the necessary income to afford a home in the valley increases to about $138,826.
Robert Little, an associate at Re/Max Advantage in Henderson, remarked on the current state of affordability in the Las Vegas housing market.
“Affordability remains a real concern in the Las Vegas housing market, especially with today’s higher mortgage rates.
That said, we’ve seen a softening in prices this year, and the market has shifted slightly in favor of buyers, which offers some relief,” he explained.
Despite a significant influx of inventory into the local real estate market, home prices remain near record highs.
Little indicated that signs of a market correction may be emerging.
“Depending on how a home is priced relative to the competition, it’s not unusual for buyers to negotiate a price reduction, have closing costs covered by the seller, or use concessions to buy down their mortgage rate,” he added.
The new homes on the market are also facing challenges stemming from current market pressures.
“Builders are also stepping up with aggressive incentives—often covering all closing costs or offering significant rate buy-downs to attract buyers,” Little noted.
Concerns about inflation and the potential for an economic recession have escalated recently, intensified by the Trump administration’s use of tariffs as a negotiating tactic with various countries.
As of May 20, Freddie Mac reported the 30-year fixed mortgage rate at 6.8%.
Matt Hennessy, a mortgage adviser based in Las Vegas, discussed the ongoing volatility in the nation’s economic outlook.
“With 15 minutes left in the trading day last Friday, the ratings agency Moody’s announced a downgrade of the U.S. credit rating.
This occurrence has taken place before, typically during periods when Congress debates the debt ceiling, government shutdowns, or budget bills,” he remarked.
“With limited historical examples, it’s uncertain whether this development will impact the markets in the coming days.”
According to the Clever study, only two cities in the nation—Detroit and Pittsburgh—were classified as affordable.
All remaining metropolitan areas have a considerable income gap necessary to afford the median home when accounting for a 20% down payment.
Iowa was the only state rated as affordable in the study.
The report highlighted that rising home prices, along with other associated costs, are increasingly burdening homeownership across the United States.
Labeling the state of America’s housing market as “bleak,” the study emphasized the significant impact of rising property tax and insurance expenses, which create wide gaps in income requirements across states with similarly priced homes.
To afford the median-priced U.S. home, currently valued at $438,000, a household would need an income of $123,226.
However, the median household income stands at only $77,719, resulting in a staggering income deficit of $45,507.
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