‘A very acute problem’: Homebuilders lament federal control of land driving up costs

An acre of land in the Las Vegas Valley is selling for more than $1 million and homebuilders are finding it increasingly difficult to pencil in projects because of government control of land, a housing industry executive said.

“We’re very land constrained with roughly 26,000 acres of land available for development within Southern Nevada,” Tina Frias, chief executive officer for the Southern Nevada Home Builders Association, said during a recent panel on the state of housing hosted by the organization.

She said obtaining developable land from the Bureau of Land Management is increasing costs so much that projects aren’t making financial sense.

“We also want to work on these challenging BLM processes, these processes and delays are often the biggest challenges in regards to accessing the land in a reasonable amount of time to produce the necessary supply,” Frias said.

Political action at the state level on housing and subsequent setbacks at the federal level in making more federal land available for development were atop the list of issues raised during the homebuilders panel.

Housing a top issue

Greg Ferraro, president and founder of The Ferraro Group, a public relations firm tied to the home building industry said, the passage of the Nevada Access and Attainability Act, which will inject $133 million towards “attainable housing projects” in the state Legislature will help alleviate the valley’s housing crisis and is a good step towards the future.

He said it’s clear that housing is now the top issue statewide.

“People feel it, this isn’t theoretical, it’s not esoteric, it’s not political pablum, this is real and people are indirectly feeling it, your grandchildren, your relatives, your families, your elderly parents, whoever it might be understands that we have, I don’t like to use the word crisis, but we have a very acute problem,” Ferraro said.

Southern Nevada’s homebuilders have been facing a number of headwinds since the aftermath of the pandemic, including increased construction costs, high mortgage rates, labor shortages, inflation, record high home prices and a glut of listings on the resale side.

On top of all this, Ferraro said there is one other defining issue when it comes to housing in the valley.

“We’re constrained by land,” he said, “and that is the crux of this challenge.”

The federal government controls close to 80 percent of all the land in the state and has been slow to release it dating back to 1998 when the Southern Nevada Public Land Management Act was first passed. However, since the act was passed with the purpose of specifically offloading federally controlled land in the area, only approximately 17,519 acres have been released and BLM has actually increased its share of land within the state, according to multiple reports.

Federal legislation

Earlier this week Sen. Mike Lee, R-Utah, announced he was withdrawing his bid to include language in Congress’ “big, beautiful bill” that would have directed the BLM to offload up to 1.2 million acres of federal land for housing.

Rep. Mark Amodei, Nevada’s sole Republican representative in Congress led a similar effort when the bill was in the House, and his version would have targeted specific portions of land in the state that could be sold rather than leaving the decision to the BLM.

Additionally, the Southern Nevada Economic Development and Conservation Act, reintroduced in March in the House, would allow Clark County to develop up to 25,000 acres of federal land over the next 50 years and protect over 2 million acres.

Sam Gilboard, the director for federal legislative for the National Association of Home Builders, who spoke at the panel said the mood in Washington regarding the nation’s overall housing crisis is rough. He said a solution will likely come “piecemeal” from Congress as opposed to “one big beautiful bill” that will tackle the whole problem head on.

“Right now I would use three words to describe it, complex, frustrating and complicated,” he said. “Lawmakers do want to solve this problem of how do we get more housing, how can the federal government leverage the tools that it has at its disposal to solve this problem. This issue like many other issues there are going to be different views on how to solve it, so one of the things about housing is whether it can be dealt with in a large comprehensive way.”

He noted a recent study from the Home Builders Institute that shows longer construction times associated with a lack of skilled labor is costing the national homebuilding industry $10.8 billion annually and that approximately 19,000 homes across the country were not build last year because of labor shortages, which amounts to around $8.1 billion.

Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.