Las Vegas’ soaring home prices outpaced wage growth at one of the fastest rates in the nation the past few years, a new report shows.
The average weekly wage in Southern Nevada in the second quarter last year was $ 825, up just 2.2 percent from two years earlier. But the median sales price of homes shot up 30 percent in the two years ending in December 2014, to $ 165,500, according to RealtyTrac.
Housing prices outpaced earnings here at the 17th-fastest rate in the country, by a ratio of more than 13 to 1, the company found.
The fastest pace was in Merced, Calif., where weekly wages rose by just $ 2 in two years, to $ 669 — an increase of 0.3 percent — but home prices jumped 42 percent, to a median $ 177,000.
Nationally, wages rose 1.3 percent to $ 782 per week, and home prices climbed 17 percent to $ 183,000.
The findings highlight the uneven economic recovery in Las Vegas and around the country following the worst recession in decades: After the economy collapsed, home prices eventually rose again amid rock-bottom interest rates and insatiable demand from bargain-hunting investors, all while workers’ wages have largely stayed flat.
RealtyTrac, based in Irvine, Calif., analyzed 184 metro areas for the report using U.S. Bureau of Labor Statistics data and local property records. The company looked at housing prices in a different time-gap than wages because, it said, changes in pay might take at least six months to affect home prices.
In Las Vegas, investors pulled the once-battered housing market from the depths of the recession by picking up cheap homes in bulk to turn into rentals. Sales prices rose at one of the fastest rates nationally, raising fears of another possible bubble.
But investors have been pulling back amid rising prices they helped create and a crowded rental market, triggering a slowdown in sales and price-growth valleywide.
The median sales price of single-family homes last month in Southern Nevada was $ 205,000, up 8 percent from a year ago, according to the Greater Las Vegas Association of Realtors, which mostly tracks previously owned homes.
By comparison, after the market bottomed out, single-family home prices jumped 57 percent in just two years, from a median $ 118,000 in January 2012 to $ 185,000 in January 2014.
Meanwhile, by last fall, about 60 percent of the jobs lost locally to the recession had been recovered, according to data compiled by Las Vegas-based RCG Economics.
But overall, employers haven’t been expanding much, giving employees more hours or raising pay, even, in many cases, to keep pace with inflation.