Many rental property owners and those contemplating entering the rental market are now anxious about what will happen to the rental market – rent values, rent collection, etc. The truth is, the current COVID-19 pandemic is uncharted territory for most real estate professionals. We are constantly hearing about fluctuations in the stock market, unemployment reports and stimulus benefits. We are also learning that evictions are on hold and late fees can’t be charged (at least here in Nevada).

But what will this ultimately mean for the real estate market? Specifically the rental market?

The measures being taken by government officials to put evictions on hold and not charge late fees clearly indicates that the goal is to maintain relative stability for folks. To be able to get through this pandemic with as as little interruption as possible. On the flip side, many mortgage companies are offering relief to homeowners who can’t make their mortgage payments rather than charging them late fees and initiating foreclosure proceedings. Stimulus benefits and supplemental funding of unemployment benefits are intended to carry folks through this period of time as well. It appears that the plan and hope is that once the pandemic passes and things begin to resume to the way they were previously the economy can rebound without having the added stress of an untold number of evictions and foreclosures, which would be detrimental to the real estate and rental market.

In the end, it really depends on how long the shut down will go on for. That will indicate what we can expect with rental and sale values and demand; whether or not folks will be able to maintain relative stability during this time and once things pick back up again resume their lives without too much loss and have jobs to get back to. In that case, we hope that the market will prove overall stable. However, if we have long term closures, lack of benefits or other unforeseeable repercussions, we may have a different market to prepare for.

It does appear, though, that the ultimate and overall goal right now is to keep people status quo to prevent major shifts in the real estate market so that once an economic rebound occurs, the market can continue to grow and thrive.

How does this affect tenants?

There are provisions for tenants who land on hard times and only able to pay partial rent, such as waived late fees and postponement of evictions, which were authorized by government officials.  Additionally, many homeowners are willing to assist tenants during this time.  However, rent forgiveness is not obligatory.  Assistance may come in the form of rent postponement.  This means that eventually the postponed rent will still be due.  Thus, if a tenant can afford rent because their job has not been affected or has the means to pay rent, it would be in the tenants best interest to continue making their rent payment.  Many homeowners have mortgages on their rental properties and so, a lack of rent means that they may have to resort to other means for payment or qualify for assistance from their mortgage company.  Additionally, many homeowners may have also lost their jobs.

Ultimately, predicting what exactly will happen is dependent on many factors. Unfortunately, at this time, it is hard to say with any certainty what will happen.  We hope that this situation will be temporary and everyone can find financial stability sooner than later and we can get back to having a thriving real estate market.

In view of very recent developments nationally and internationally with COVID-19, it is safe to say that the world has turned upside down. Panic buying, social distancing and coronavirus have become everyday words. Beyond that, many businesses and government offices are closed for business. Talk of a recessive economy are gaining momentum.

As a result, the Fed has cut their interest rate even further in order to build confidence in society and as a result keep banks lending. However, the interest rate for home loans has actually ticked upward. In fact, just this month alone, interest rates went from an average of about 3.30% to nearly 3.75% (on a 30 year fixed loan). Many people are interested in a refinance or even purchase of a home because of how low interest rates are. So, why did rates go up?

Well, mortgage rates don’t necessarily follow the Feds interest rate always. They will adjust to a certain extent, however, they typically follow 10-year bond yields, such as the treasury note. The 10-year treasury note actually went up this month. This was due to the fact that a major stimulus package was approved in view of COVID-19, adding to the national debt and affecting the yield market.

However, rates will continue to fluctuate. Many people are applying for refinances right now or new loans and so banks and mortgage companies are back logged, affecting mortgage rates. The fed and other government agencies will most likely continue to implement new measures to help the economy, which will have an effect on this also.

While interest rates are still historically low, we can expect continued change due to market volatility. The quicker we see stability, the better the economy. The better the economy, the more confidence the consumer will have.

Contributed by Nicklin Property Management.

The Las Vegas economy continues to prosper, in a large part due to the vast amount of tourists that visit the city. These tourists, in turn, support various service industries, such as the many hotel employees and individuals working in the transportation, restaurant and special events sector. According to the Las Vegas Convention and Visitors Authority, nearly 400,000 jobs are supported by tourism. Over the last few years, Las Vegas has seen more and more domestic and international travelers come through the city, adding to a robust economy.

In 2019, over 42,000,000 tourists visited Las Vegas, with over 6,500,000 of those attending conventions. Revenue from these tourists totaled into the billions of dollars.

McCarran International Airport likewise reported records. In 2019, McCarran saw over 51,000,000 passengers travel. More and more routes were announced through both domestic and international carriers and Las Vegas became a hot spot destination.

All in all, the last few years have seen tremendous growth in many areas for the Las Vegas valley, a far cry from the economic situation a decade ago.
Contributed by Nicklin Property Management.

Sources: Las Vegas Convention and Visitor Authority & McCarran International Airport

Las Vegas continues on its economic boom.  Each week we hear of a new project taking shape, adding to the local economy.  Las Vegas is expanding – attracting new residents, businesses and high profile projects.  The initial investments total into the billions.  The residual will impact the local economy for years to come.  Here are some noteworthy projects that are in process or planned.

The Drew (formerly the Fountainbleu)
Located on the north end of the Las Vegas Strip sits a nearly 70 story unfinished tower, a symbol of the great recession. After trading hands in the recent years, reports are circulating that the owners of what is now known as “The Drew” are close to securing financing in order to finish this huge project. Though from the exterior the tower appears to be somewhat finished, there is much to be done inside and around the property. The project is anticipated for completion in about 3 years. Once finished, it will be a spectacular tower that will add life to the north end of the strip. As it stands currently, it will be the tallest building in Nevada outside of the Stratosphere Tower.

Resorts World Las Vegas
This multi-billion dollar resort, sitting across from the Wynn Las Vegas, has taken shape after sitting dormant for a few years. This luxury resort will feature some 3500 rooms, a 5000 seat theater, pool and spa complex and be the most expensive resort to be built in Las Vegas. It will add a tremendous economic impact to Las Vegas.

Wynn Convention Center
Wynn Las Vegas recently opened their expansion to the Wynn Convention Center. At over $400 million in cost to complete, it sits close to the golf course and offers extraordinary views to those gathered for conventions. The extra convention space is sure to attract more business to the Wynn, but also to the city, adding to its economic impact.

Other Convention Spaces to Open
Ceasars and The World Market Center are also in the middle of adding convention space to their existing facilities. Caesars is scheduled ahead of the World Market Center. However, both new convention facilities will add nearly 1 million square feet of new gathering space in Las Vegas, paving the way for additional business ventures.

New AHL Arena
The Vegas Golden Knights have pursued a new arena for their AHL affiliate to be located in Henderson (off Green Valley Parkway). This new arena will allow a designated facility for the AHL. This is in addition to the new Henderson Community Ice Hockey Facility that is currently under construction.

Raiders Practice Facility
In addition to Allegiant Stadium, the Raiders are in the process of constructing their practice facility in Henderson. It will feature 3 practice fields, theater, cafe and a three story building. It is located close to St Rose Parkway and the Henderson Executive Airport. The cost is estimated at under 100 million dollars and construction should be completed by the time the next NFL season begins.

New Google Data Center
Google is in the process of constructing a $600 million data center in Henderson which will employ a number of people in a variety of different roles.

Dream Hotel
A recent announcement was made to construct a new hotel on the south side of the Las Vegas Strip. It will feature luxury amenities, 450 rooms and a pool complex. It will add an economic boost to the far south end of the Las Vegas strip and the businesses that surround it.

Virgin Train Station
As plans appear to progress on linking California with a high speed rail from Las Vegas, it was announced that a nearly 300,000 square foot train station will be constructed south of the Las Vegas Strip. It would feature ticketing areas, shopping and office space. This along with the rail connecting California is sure to bring an economic impact as more people can reach Las Vegas in a shorter time – 90 minutes.

In recent years, Las Vegas has materialized many projects and visions that for many years seemed out of reach. As Las Vegas continues to grow as more than just an entertainment mecca, it will attract new businesses and ventures that which will lead to continued economic progress.

Contributed by Nicklin Property Management.