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.
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 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.
Leaning towards a seller’s market in 2017
We are seeing a very positive trend appearing in November, 2016. Inventory, which is the number of resale homes available for sale at this moment in time, is at its’ lowest since October of 2013. This is not just a seasonal low. When we compare the inventory from November of 2016 to the previous Novembers we are 16% under November 2015, and 26% below November of 2014.
This trend coupled with and election being over, positive economic forecasts including job growth in Las Vegas; indicate a potential for increasing prices in 2017. Each percentage of price increase in this market means that still underwater homeowners are closer to potential options. Many of these homeowners have not been able to move. These are the residents who have not walked away from their home or short sold their home but rather have stayed the course realizing they still needed a place to live and decided to wait it out. In 2017 these homeowners will get closer to being able to sell and move up, down or out.
Another positive trend if the increase in luxury sale in the market. November sales over one Million dollars are up 46% from prior month.
Interest rates are creeping up as well but we are still at historically low rates making homeownership possible for many.