If you live out of state you may not be aware of the Real Estate market in the Southern Nevada; the activity in the market is incredibly strong and there may be a possibility of creating a Tax Free Exchange.
- Southern Nevada residential Real Estate has increased 9% since the first of the year.
- Depending on how long you have owned your property here, your property may have increased in value up to 86%.
Average Single Family Sales Price
May, 2012 $161,003
May, 2013 $214,490
May, 2014 $236,850
May, 2015 $245,985
May, 2016 $275,209
May, 2017 $299,046
If you purchased your property in May, of 2012 your property could have potentially increased in value 86%. If you purchased in 2015, values went up 21%.
Properties are selling over list and buyers are bringing in cash above appraised values. Do get an accurate picture of your property valuation, contact me by phone or email and I will forward you the details. Investors are still buying because the market is strong and they are seeing a continued increase in pricing.
If your Real Estate investments have increased in value, you may be in a position to sell and do a tax free exchange and purchase multiple properties with the cash from a sale. This is a great way to leverage your current investment.
If you would like to discuss your situation in detail please reach out to me. For more information on the market you can go to my blog or Facebook page.
There are approximately 160 current Special Use Permits in the City of Las Vegas for Short Term Rentals. The City of Las Vegas has voted on what is really a ban on short term rentals. Current permitted vacation rental homes will be grandfathered in under their original rules.
City of Las Vegas – New Rules
The new law requires any new permits to be limited to owner-occupied homes. In other words, a maximum three bedroom home could apply for and potentially be approved for a special use permit. The home would have to be owner occupied and with the permit the owner could rent out a bedroom or more in their home on a short term basis. If the property is located in a homeowner association, the HOA rules would apply. It is likely that under these new rules, fewer people will apply for the permits. Currently only 1% of the short term rentals in the City of Las Vegas are owner occupied.
Short term rentals are properties that are rented for fewer than 30 days. The owner occupied short term approved rentals must have no more than 3 bedrooms and be at least 666 feet from the nearest other short term living unit.
Real Options for Investors looking to participate in the Vacation Rental market
If you are considering investing in Vacation Rental type properties in the Las Vegas area, we recommend sticking with the approved high rise developments that are zoned hotel/condo and have licensed hotel http://www.lakelasvegasvacation.com operators on site to manage the booking and guest processes. Contact your Windermere Real Estate agent to find out more about this legal option.
What is a short-term residential rental?
Short-term rentals are generally defined as the rental of a residential property (e.g. house, condominium, room, garage apartment, etc.) for a period of less than 30 days. Often these rentals are advertised on-line on sites such as Airbnb and Homeaway.
Las Vegas Valley New home sales nearing 2006 levels.
Through the first four months of the year, new home closings have reached 3,264; a 22% increase over the same period last year. If new home closings continue at this rate, we will have seen nearly 10,000 new homes closed in 2018; less than 2006 but nearing those levels. Building permits pulled in April were 1,047, a 28% increase from April of 2017. This brings the total number of building permits through April of 2018 to 4,059, 33% higher than last year. If this pace continues we will have over 12,000 permits pulled in 2018. This increase in permits pulled will pave the way for strong new home sales in 2018 and 2019.
With the increase in new construction sales, construction worker talent is in high demand. There is currently a shortage of construction workers which has slowed down the build time from four months to build a new home to six months.
The current median new home closing price in April was $374,440. This is an increase of 11 percent over prior year. Many factors are causing this increase including; labor shortage, material costs, land costs, high demand for new construction and supply shortage.
In California, all new homes will be required to install solar panels for whole house solar systems in an effort to save energy beginning January 1, 2020. It will be interesting to see if Nevada follows in the same path.
If you describe Real Estate as Luxury enough times, it starts to lose its meaning. Luxury is entirely overused in the Real Estate market to describe properties that do not meet the general definition of a Luxury Real Estate Property. In fact, the term Luxury has been used to describe Ultra Luxury Real Estate; homes of the world’s wealthiest 1% to a small kitchen re-model.
The Institute for Luxury Home Marketing, which specializes in training real estate professionals in high-end home sales, defines luxury as the top 10% of the Real Estate Market in any metropolitan market. You may be surprised to know that 90% of the resale homes that sell in our market are under $630,000.
In addition, there is no official checklist for labeling a property as luxury. Noteworthy, there are some general features that are common in upscale properties:
- Gated communities or buildings with a high level of security
- Prime Location
- Professional Quality Kitchen Appliances
- High End Interior Finishes
- Customized Closets
- Hotel like facilities if the property is located in a luxury building
In the Las Vegas Market in the preceding six months:
The top 10% of the market that sold was $630,000 or above that price point. There were 593 homes that sold with an average days on market of 89 days.
The top 5% of the market that sold was $925,000 or above. 222 homes sold and were on the market an average of 105 days.
The top 1% of the market that sold was $3,000,000 and over. 25 properties sold with an average days on market of 164 days.
Finally, if you are questioning whether your home would be considered in the top 10% of the market, talk with your Windermere Prestige Properties Agent. To preview our Luxury listings go to: www.finevegashomes.com
There is a thirty-day supply of rentals in the Las Vegas Valley, down dramatically from spring of 2017 where there was a ninety-day supply. Why are rentals in high demand and inventory so low? There are several factors affecting this market; one factor is the low inventory of affordable properties available for sale, making it difficult for buyers to find a home.
Buyers making offers and losing out on properties to higher bidders or cash buyers are getting frustrated and putting buying “on hold.” These frustrated buyers are renting apartments, condo’s, townhomes and single-family homes in lieu of purchasing. They may be back in the market but not until the market dynamics change.
Millennials, the 26 to 34-year olds, for the most part do not want the responsibility of home ownership, and they prefer to spend their money on experiences, not a mortgage payment. Many in this age group are also carrying large amounts of student debt, which is impacting their ability to save a down payment or afford the monthly payment.
Vacancy rates have dropped dramatically over the past few years; from 9.48% in 2015 to 3.1% in 2018. This demand has also pushed up overall rental rates.
This is good news for landlords, apartment owners, and Real Estate Investors.
Windermere Prestige Properties has many Rental Homes available; long term and short term. To find out about these offerings go to: www.finvegashomes.com or www.lakelasvegasvacation.com
The 2017 Las Vegas Real Estate Market Summery. 2017 turned out to be a positive year in the Real Estate market for our clients.
36% Average Sales price has increased in the past five years. Our 2017 Las Vegas Real Estate Market Summary determined in December of 2013, the Average sales price for a Residential Single Family home was $231,725; while in December, 2017 the average sales price was $316,359. That is an increase over five years of $84,634 or 36%.
The total number of resale closings totaled 43,023 in 2017, an increase of 7.5% over 2016 and an increase since 2014 of 24%. New construction closings are predicted to be over 9,000 for 2017 a year to year increase of 15%. The average price of new construction is now over $350,000, an increase of 8% over prior year.
What does the future hold for our Real Estate Market and what does this mean for our clients buying and selling?
*. There are no immediate signs that would signal prices will start dropping, in fact we believe pricing will continue to climb.
*. Consumer demand is still strong.
*. There is no sign of over-building in new construction.
*. California residents average price for a home is $500,000. This along with the Congressional proposed legislation to cap state and local taxes which could impact resident’s ability to itemize some deductions could be the catalyst to prompt our neighbors to move North to Nevada.
*. 43,000 homes or 10% of all mortgages are still underwater in Clark County. A year ago 19% of the homes In Clark County were underwater. Though the market is not completely healed, this is a step In the right direction.
*. There is a less than two month supply of housing.
*. Interest Rates continue to be stable.
2018 should continue to move in the right direction for housing, with the number of closings both resale and new construction continuing to rise. The economic forecasts continue to predict a population growth in Clark County of a minimum 2% a year.
For those considering purchasing In 2018, if your price point is under $400,000, properties in good condition, priced at or slightly above market are getting multiple offers and often sell over list. Take this into consideration when your write your offer.
Those considering selling; 1). Make sure your home is in the best possible condition to that you get the best price, 2). Price your home at market or slightly above, and 3). Make sure your home is easy to show. Always, utilize the skills of a professional Realtor with a proven track record.
The data indicates there is lower inventory than spring of 2016. This lower resale inventory of Single Family homes has impacted the days on market. Properties selling within the first 30 days are at 62.6% of total properties available for sale. In addition, there is an increase in the number of properties selling in the first 30 days by 10% when compared to April of 2016.
Average Days to close from list
Total average days on market is now less than 120 days. Properties that are priced right and in the market under $300,000 are getting multiple offers and in many cases, buyers are bidding above list. Some sellers are asking buyers to pay more than the appraised value if the appraisal comes in less than the agreed upon sales price.
Recommendations to buyers
If you are a buyer, we recommend you act quickly writing and presenting your offers. Include your pre-qualification letter from your bank, or proof of cash to close the transactions if you are paying cash. A letter to the seller telling them how much you like the home could be what you need to convince the seller to sell to you in a competitive market.
For a few hundred dollars more a month you may be able to enjoy a larger home because of homeowner equity and interest rates.
Homeowner equity at 85% in Southern Nevada.
Great News for Southern Nevada; nearly 85% of homeowners in have equity in their homes. This is an increase over 2015; in which only 79% of homeowner’s had positive equity. If you have positive equity and you want to move up to a larger home or a home in a different area; you may be paying only slightly more for a larger, more expensive home. If you purchased your home in the early to mid 2000’s you probably got a mortgage in the 6% or more range. Current mortgage rates are up to 2% less.
For as little as $232 a month a homeowner can enjoy $100,000 upgrade in their home.
Example: Your home was purchased in 2003 for $250,000 with a mortgage of $200,000. Your current interest rate is 6.25% with a current payment of: $1,231.43 (principle and interest). If you were to sell that home and move up to a $350,000 home; your mortgage could be 4.25% on $297,500; or $1,463.52 (Principle and Interest). For $232.09 in additional payment (principle and interest only); you can move up to a home that is potentially larger, perhaps a larger homesite or perhaps a new home.
There is an opportunity for homebuyers to participate in greater appreciation buyer selling now and buying.
Another benefit; with the prices increases in this Real Estate market; you will have the opportunity to participation in greater appreciation. You might be surprised what you can get for your home now. It is a seller’s market. We recommend you explore this opportunity to own the home of your dreams for a small additional monthly payment.