How many new homes does Las Vegas Valley need to fix housing crisis?
The Las Vegas Valley is short about 58,100 homes to adequately deal with its housing crisis, according to a new report from the American Enterprise Institute and the U.S. Chamber of Commerce.
This figure makes up about 6.2 percent of the region’s housing stock, the report estimates. Nevada overall is short about 81,000 homes, with the entire country short between 4 and 8 million homes, a number that has been steadily rising the past few years, according to the report.
“Housing has long been a cornerstone of the American dream and the nation’s economy, but a supply-demand imbalance has pushed the U.S. market into crisis, driving up prices and limiting workforce mobility,” the report states.
Las Vegas finds itself in the middle of a housing crisis as home prices are just below record highs, homes for sale continue to flood the market, rents remain elevated and residential construction and sales have slowed. The valley is constrained by a lack of land to develop as the federal government controls most of it, while increased construction and labor costs have placed an additional burden on homebuilders trying to make up the gap.
An overall slowdown in real estate construction is also taking hold across the country as several issues weigh on the industry, including interest rates, economic uncertainty around tariffs, increased material costs due to recently imposed tariffs and a general caution among industry players regarding starting new residential or commercial projects across the nation.
“That shortage is an invisible hand squeezing families out of home ownership, pushing rents higher and forcing workers to commute farther from jobs and schools,” the report states. “Every year we fail to close it, prices climb faster than wages, overcrowding worsens and the dream of a starter home slips further away.”
The report proposes a four-pronged approach for the valley to build more homes, the first option being lot-size flexibility for new subdivisions. Estimates are as many as 18,600 units could be added to the valley’s housing stock if there was an increased emphasis on green-lighting smaller lots sizes for products such as townhomes and condos.
“From 2000 to 2024, 13 percent of new homes built in residential subdivisions in Las Vegas have been townhomes, a form that uses land more efficiently, requiring just 39 percent of the land needed for a typical detached home,” the report states. The report also noted that the median price of a newly built single-family home in a subdivision is about $528,000, well above the median sale price of a financed house at $445,000.
A second option is creating more housing by allowing existing lots to split into smaller parcels, which could potentially add 1,700 new homes to the market. A third option is to amend county and municipality rules to allow residential projects to be built on land currently zoned commercial, and a fourth option is to open more public lands for residential builds.
Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.