If you were thinking that the real estate market in Las Vegas was going to peak and settle, you might be surprised at some of the data we’re looking at. The number of new listings is higher than it was in 2023, prices have continued to go up, and there’s a drop in single-family inventory, which is creating an even higher demand for those homes.
Yes, it’s more expensive to get a mortgage now than a few years ago. That doesn’t seem to be holding too many buyers back.
We can credit the continued strong performance with ongoing population increases, a strong local economy, and a population of people who are looking for homes. The strong real estate market feeds into a strong rental market. Those rental values are much higher, and there is a stable and well-qualified pool of tenants who are willing to pay top dollar for a well-maintained rental property in the right neighborhood.
All of this is good news for Las Vegas real estate investors.
It’s good news for Las Vegas property managers, too. We’ve been busy helping people identify the right homes to invest in, lease them to good tenants, and keep them well-managed and maintained.
With everything that’s going on and so many questions coming our way, we wanted to take some time to provide a real estate market update. Let’s talk about where we are in Las Vegas, and where we see ourselves going.
Las Vegas Real Estate: Pricey and Promising
The latest data from Redfin, which gathers insights from the MLS and public records, tells us that home prices in Las Vegas are up 9% from last year, at a median selling price of $435,000. Other analytics we’ve seen have the median sales price as high as $485,000.
With about a thousand homes selling every month and days on market resting at around 34, things are moving faster and more competitively than they were at this time last year.
What does that mean?
If you’re looking to buy real estate or invest in a rental property, it means you have to be prepared to move quickly. Get your financing in order. Know your investment goals and what you’re looking for. Surround yourself with a great team of agents, property managers, and lenders so you’re ready to make a move when the right opportunity shows up.
If you’re selling real estate, it means you can basically expect to earn what you’re asking. There may be multiple offers. You’ll have to negotiate quickly in order to close the deal and make your money.
If you’re an investor, this is a great time to shore up your portfolio or even diversify. The Las Vegas real estate market is growing, it’s expanding geographically and reaching more people, and it’s providing opportunities no matter what your level of experience or your investment goals happen to be.
Impact of a Growing Las Vegas Population
People are moving into Las Vegas from cities like Los Angeles, Seattle, and San Francisco. This trend is facilitated by the lower housing prices we offer in comparison to the cities they’re leaving as well as the growth of remote work. People who work from home are finding that they don’t have to be within commuting distance of their employer anymore. This opens up a lot of geography for remote workers, many of whom are choosing cities like Las Vegas.
It’s not just remote workers who are relocating to this part of the southwest. We’re also seeing a lot of economic development within our metro region, allowing people to look for and find good jobs in industries that expand beyond the traditional retail and entertainment sectors that have long supported Las Vegas. There’s been growth in:
- Tourism
- Gaming
- Manufacturing
- Information Technology
- Mining
- Construction
- Banking
We have Amazon here, Target, Starbucks, and a growing list of airlines and other companies that are setting up operations in a market that’s attracting a large pool of talent. We expect the growth to continue.
Las Vegas Real Estate Investors are Buying a Lot of Inventory
Investors are having an impact on the Las Vegas housing market right now, and it’s a larger influence than is typical.
One of the reasons that investors are squeezed, especially in the single-family home market, is that investors are buying up a lot of these homes. Most of them are doing so with the intention of renting them out. Both rental values and resale prices are strong and reaching even higher.
A study out of the University of Las Vegas (UNLV) estimates that 15 percent of the inventory in Clark County has been bought by real estate investors (defined as an entity owning five or more rental properties). Some of these are independent investors who are slowly and successfully growing their own portfolios. A lot of them, however, are hedge funds and institutional investment companies who see rental homes as a huge money maker in a market like Las Vegas.
Some of those cash-rich investment firms are trading real estate like stocks. If you were paying attention to the real estate news last year, you know that Starwood Capital Group, an investment firm out of Miami, sold 264 homes in Clark County for $98 million to Invitation Homes, an investment group out of Dallas with a lot of Wall Street money. This happened last summer, according to Clark County property records.
What does this mean for the market? We’re not quite sure yet. It does make things more competitive for investors who are on their own and not part of a hedge fund or a corporate-backed conglomerate. That doesn’t mean there aren’t plenty of opportunities.
Understanding the Rental Market in Las Vegas
As Las Vegas property managers, we are always watching what kind of impact the real estate market has on the rental market. We can tell you that rents are certainly up. They’re outpacing the national average, and it comes as no surprise given the number of people here who need good housing and the shifts in demographics that are delivering more renters than buyers into the market.
Getting new construction projects onto the market quickly has been a challenge, which means the lack of inventory keeps the market competitive for tenants.
Those higher mortgage rates we mentioned earlier might not be keeping investors out of the sales market, but they are a bit of a deterrent for home buyers. Instead of over-spending on a mortgage that comes with high rates, a lot of would-be buyers are waiting for interest rates to come down and home purchases to be more affordable. They’re staying in the rental market a bit longer, which is allowing for higher rents and more competition.
Emerging Trends in Las Vegas Real Estate
What does this market update mean for the future? If you’re a smart investor, you’re always looking down the road a bit, and positioning yourself to take on any challenges and seize any opportunities. Here’s what we can tell you about the things to come:
- Short-term Rental Markets are Growing
With Las Vegas being a top destination for tourists, short-term rental properties like vacation homes and Airbnb units offer attractive returns. The city’s lenient regulations for short-term rentals compared to other major cities make it an excellent option for investors interested in this niche. The higher per-night rates that can be earned compared to long-term leases are attractive to both investors and owners who have a home or even a bedroom to rent out.
- Tenants are Looking for Smart Homes and Sustainable Living
The demand for smart homes equipped with the latest technology is rising. As more retirees and tech-savvy professionals move to Las Vegas, properties that offer smart features and sustainable living options will likely see higher demand and better returns.
- Growing Las Vegas Luxury Market
The luxury real estate market in Las Vegas is growing. High-net-worth individuals are increasingly interested in exclusive properties that offer unique features like panoramic views, private pools, and state-of-the-art amenities. Neighborhoods such as The Ridges and MacDonald Highlands are hotspots for luxury investments, and this is getting the attention of investors.
Challenges to Consider
Things are looking pretty good for anyone with investments in the Las Vegas housing market. However, you want to manage and mitigate your risk as best you can, and this is what we suggest:
- Watch for Market Volatility
While the Las Vegas real estate market has shown resilience, it’s not immune to economic downturns or unexpected events. Investors should be prepared for potential market fluctuations and have contingency plans in place. Few markets were hit harder during the recession 15 years ago than Las Vegas.
- Expect Regulatory Changes
Nevada is a fairly landlord-friendly state, which is great for investments. But, there are always going to be laws that need your attention, so stay updated on local zoning laws and regulations, especially concerning short-term rentals.
Let’s talk about what’s possible for you. Please contact us at New West Property Management. Our team expertly manages residential rental homes in Las Vegas and throughout Clark County, including Henderson and North Las Vegas.
