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Las Vegas rents rising, home prices at record highs, reports say

Updated June 26, 2024 - 10:49 am

Las Vegas rents are trending upward, and home prices are at record highs again, according to reports from Redfin and the National Association of Realtors.

More than half of Las Vegas renters can’t afford their current apartment, according to the Redfin report.

A Las Vegas household needs to make $61,080 to afford the median apartment rate in the valley, but the estimated median income for a local renter is $56,066, the report said. This means only 46 percent of renters in Las Vegas are living in apartments they can afford if they are spending 30 percent or less of their monthly income on housing.

Sheharyar Bokhari, a senior economist with Redfin, said the Las Vegas Valley has seen an increase in year-over-year asking rents over the past couple of months after continuously falling since November 2022.

“Although the market has rebounded, the median asking rent of $1,527 in May is still roughly 11 percent below the peak rent of $1,715 in June 2022,” he said.

Nationally, rental burden numbers are even worse. Only 39 percent of American renters can afford the apartment where they live.

Bokhari said rents are growing slower than they did during the pandemic, and that wage growth is currently outpacing rent growth and should continue to do so for the next few months.

However, this still means many Americans are being overly burdened by housing costs, he said. Wage growth “will help narrow the affordability gap for renters, but for a lot of folks, the math still won’t check out. Many U.S. renters are and will remain burdened by the cost of having a roof over their head, and unlike homeowners, they’re not building wealth through rising property values.”

Rising single-family home prices

In terms of single-family homes, the National Association of Realtors says the median sale price hit a record high of $419,300 in May.

NAR chief economist Lawrence Yun said the gap between homeowners and those who don’t own property in the U.S. is further widening, creating a new wealth disparity across the nation.

“Home prices reaching new highs are creating a wider divide between those owning properties and those who wish to be first-time buyers,” he said. “The mortgage payment for a typical home today is more than double that of homes purchased before 2020. Still, first-time buyers in the market understand the long-term benefits of owning.”

Brian Nevins, a sales manager for the Midwest at Bay Equity Home Loans, which is owned by Redfin, told the Las Vegas Review-Journal in an interview the mortgage market is “anemic” right now because of high interest rates. Nevins said when the government dropped interest rates during the pandemic, it spurred a wave of business for the mortgage lending industry.

“Everybody went gangbusters, everybody in the neighborhood went and refinanced,” he said. “So with rates being high, you are killing trillions of dollars of new loans that could be written because there is just not an appetite for it.”

The Las Vegas Valley finds itself mired in a housing crisis, and a lack of land on the residential side has been one of the driving factors in the market. Supply also continues to remain low, because many homeowners are content to sit on the homes and mortgage rates they got during the pandemic.

Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.

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