The Las Vegas housing market continued a hot streak throughout August leading into September. The median sales price of a single family home was $405,000 (Las Vegas Realtors), matching the prior month. The median list price was $422,000 according to Realtor.com, a possible indicator of continued price appreciation. More and more buyers from out of state, such as California, have been relocating to Las Vegas, investors are purchasing properties and first time home buyers are trying to eek their way into home ownership. This heavy demand has caused a strain on an already reduced inventory. As a matter of fact, the available inventory of resale homes is down 34.6% from August 2020 according to Realtor.com.
As discussed in prior blog posts about the real estate market, a low interest rate combined with low available inventory has driven prices up as this has stretched many home buyers budget. As a result, home buyers are willing to pay more while saving on monthly interest charges. All the while, homeowners are putting more cash in their pockets when selling their properties.
The rental market has also seen it’s fair share of appreciation. Rental rates are skyrocketing within the Las Vegas valley, allowing many single family homes to rent between $1.25 – $1.50 / square foot or more. These are significant gains, especially when compared to just a few years ago when many properties were leasing far below that. Again, a limited inventory combined with increased demand is causing landlord’s to raise rents. For landlord’s, this is a prime time to capitalize on their investment properties and raise rents. For investors looking to enter the market, the increase in rental rates is good news. It allows for higher returns against higher resale values.
While it may be tempting to sell a property that has much appreciation, it is also good to consider what your property may rent for in today’s market. Some landlord’s have decided to sell because they weren’t aware of the rent potential of their properties. So, before selling, consider all of your options.
While it is difficult to predict how things will go long into the future, the Las Vegas real estate market has proved resilient and even surprising. It has caught many homeowners and landlord’s off guard – in a good way! As a result, investment properties today are doing what many have wanted for a long time – providing a solid return on their investment.