Valley Realtors herald healthy housing market

After several years of record home sales, the housing market in Southern Nevada remains strong by historical standards and is expected to stay at high levels through most of 2004, according to the Greater Las Vegas Association of Realtors.

"The decision to purchase a home is a long-term decision that is usually not impacted by immediate events, and there are several reasons, such as near-record low mortgage interest rates, for why this may be one of the best times to purchase a home," Lee Barrett, association president, said.

He pointed out that the current market is especially attractive for first-time buyers, who are most sensitive to changes in interest rates. Although home prices are escalating, low interest rates are keeping the market open.

"Lower mortgage rates mean lower monthly payments for consumers, giving buyers additional purchasing power," Barrett said, cautioning that rates may rise soon.

"With a strengthening economy, investors will reallocate funds in their portfolios from bonds to stocks, and as funds move away from mortgage products, mortgage interest rates will rise. With most economic forecasters calling for a rebound, home buyers will benefit the most from locking into today's low mortgage interest rates."

In many cases, Barrett said, monthly mortgage payments can be less than rent for a comparable property.

"At the very least, even without considering the tax benefits, homeownership provides many more benefits than a drawer full of rent receipts," he said.

Barrett cited a National Association of Realtors survey stating that a home is becoming a major source of wealth for many Americans. The survey showed that three out of four homeowners said they have more wealth in the equity of their homes than they do in their investment portfolios. A Federal Reserve study also showed home equity holding a larger share of household wealth than any other asset.

The wealth comes in part from constant home-price appreciation. The national association has shown an average annual increase of 6.3 percent since it started tracking appreciation in 1968.

"Over the past few years, as the stock market has experienced tremendous volatility, house-value growth has outperformed the performance of stock prices," Barrett said. "The most effective way to take advantage of this opportunity to buy or sell a home is by using the experience and know how of today's professional Realtor."

In addition to helping buyers find the right home, realty agents are good sources for information on loan programs, while sellers benefit from their ability to determine "comparable housing values and the level of buyer interest in certain types of properties."

"Also, with the ability to qualify potential buyers, along with marketing skills and experience, the agent will be able to advise the seller on which offers to accept and negotiate the final agreement."

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