Housing permits in Nevada drop for 2nd straight year

Housing permits in Nevada dropped for the second year in a row, according to a new study from Point2, an online real estate search portal.

The state issued 18,473 new housing permits last year, which includes single-family homes and apartment units, an 8 percent drop from 2022, according to the report, which obtained its data from the U.S. Census Bureau.

While there was a slight increase in single-family home permits, the study noted a 32 percent drop in permits for apartment projects, which “points towards a contraction in the multifamily housing market, potentially limiting options for residents seeking affordable housing.”

Zeroing in on the Las Vegas Valley, new permits issued last year totaled 13,073 in 2023, which was flat from the previous year. But there was a noticeable drop, 23 percent, in permits for apartment complexes “suggesting a shift in the region’s housing stock, with implications for the variety of housing in the area,” the study said.

The valley is experiencing an increase in multifamily units coming onto the market, which have flattened and even decreased rental rates in some areas, but in a previous interview with the Las Vegas Review-Journal, commercial broker Jeffrey Swinger said the pipeline for new apartment projects is bleak, as the building boom that was brought on during the pandemic has come to an end.

Carson City and Reno saw bigger drops in 2023, with permits dropping 11 and 28 percent, respectively.

This month Gov. Joe Lombardo sent President Joe Biden a letter urging him to release more of the state’s land that is owned by the Bureau of Land Management to allow for more housing developments.

Last year the valley saw its worst year since the Great Recession for home sales, as high interest rates have locked many homeowners into their properties. Meanwhile, new supply continues to come onto the market this year and home prices refuse to drop. Redfin said it its latest market report that this is a trend playing out nationwide.

“Increasing inventory has yet to dampen price growth. The median U.S. home-sale price is up 5.3 percent year over year, the second-biggest increase since October 2022, and the median monthly mortgage payment is just $31 shy of its all-time high due to elevated mortgage rates and prices,” the report said.

Redfin expects mortgage rates to decline throughout the year.

Nevada and the valley are in line with national trends as nationwide permits dropped 11 percent year over year up until the end of 2023, a decline for the second consecutive year.

“Of the 384 total U.S. metros, permits fell in 266 and increased or stagnated in 118,” the Point2 study said. “This means that a distressing 70 percent of all U.S. metros saw a reduction in new permits in 2023.”

Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.