January 7, 2022 - 3:00 pm
The Las Vegas luxury housing market exploded in 2021 by more than doubling the record-breaking sales of 2020 — including the category of $4 million and above — as California and other out of-state residents flocked to Southern Nevada during the COVID-19 pandemic.
The looming question is whether that can be duplicated in 2022 since buyers have picked through much of the supply as builders continue to have a difficult time building enough luxury homes to keep up with the demand. That could limit any sales growth compared to 2021 and contribute to even higher prices.
The luxury sales on the Las Vegas Realtors association’s Multiple Listing Service as tracked by Forrest Barbee, corporate broker for Berkshire Hathaway HomeServices, shows there were 1,686 sales of $1 million and above in 2021. That more than doubles the 825 in 2020 — a record surpassing the 596 sales in 2019.
This luxury list covers primarily existing homes in the Las Vegas Valley and throughout Clark County, and there’s some condos and new homes listed as part of the MLS sales. Any non-MLS off-market sales would not be included.
A further breakdown of Las Vegas Valley luxury stats from Realtor Rob Jensen of the Rob Jensen Co., shows there were 1,506 single-family home sales of $1 million or more compared to 745 in 2020 and 515 in 2019.
The surprise came in the $4 million-plus market with 101 single-family luxury homes sold in 2021, up from 51 in 2020 and 20 in 2019. There were 279 sales between $2 million and $4 million compared to 139 in 2020 and 88 in 2019. The $1 million to $2 million category saw 1,126 homes sales in 2021, up from 545 in 2020 and 407 in 2019.
The luxury market has transformed in Las Vegas since July 2020 after the valley reopened from its COVID-19 shutdown, which had kept out-of-state buyers away. That reopening triggered a wave of purchases throughout the marketplace but no category felt it more than luxury.
The LVR released a report Thursday that shows 2021 was a record year of sales for existing homes with more than 50,000 properties changing hands despite rapidly rising prices and a tight housing supply. That’s a 22 percent gain.
LVR reported that the median price of existing single-family homes sold in Southern Nevada through its MLS during December was $425,000. The median home price is up 23.2 percent from $345,000 one year ago. Those rising prices pushed up the threshold of homes that fall into the luxury category of $1 million and above.
The activity in 2021 ushered in new Las Vegas brokerages changing hands as Las Vegas in one of the hottest real estate markets in the country. The LVR reported there were 17,144 Realtors as of Dec. 31, an 11 percent increase and approaching the record of 17,500 in 2006. There were 15,500 Realtors at the end of 2020.
At least to start the year, the luxury segment shows no signs of slowing down. Barbee reported there were 223 pending luxury sales at the end of 2021.
“Strap in because we’re going higher,” said Kristen Routh Silberman, a partner and Realtor with Corcoran Global Living, a new brokerage firm to enter the marketplace in 2021. Previously, she represented Synergy Sotheby’s International Realty in Las Vegas. “I’m super bullish on 2022. That frantic pace probably is not there, but that frantic pace could shoot out any minute because there’s a couple of bills pending in California (for tax increases), and the dam could break again.”
That doesn’t mean 2022 luxury real estate won’t face any headwinds and challenges, Realtors say. It will.
“Our challenge is going to be inventory and getting enough product on the market in front of people,” Routh Silberman said. “I think that people who have luxury homes that were thinking about selling them and haven’t already remodeled their kitchens and bathrooms, now would be a great time because they will be able to capitalize on their investment.”
Mark Stark, CEO of Berkshire Hathaway HomeServices Arizona, California and Nevada Properties, said the luxury market will remain strong as long as the stock market continues to do well. What will hold it back is that the luxury inventory started 2021 ahead of where it is in 2022, he added.
“The luxury market in 2021 exploded and was off-the-charts amazing,” Stark said. “It blew away every budget and thought process. Las Vegas is more on the map than it ever has been. It’s becoming more of a traditional destination, and not just for entertainment, and not just for coming to the Strip. It’s a community that benefits from (low) taxes and (mild) weather. While it’s going to be a vibrant market in luxury, comparing it to 2021 is not realistic. COVID supported 2021 in a big way. People were saying as long as they were going to be sheltered in their homes, they want the home they want. People upgraded through renovation or bought their next property. It was a catalyst that brought people off the bench. By math, we will have a difficult time beating 2021.”
Routh-Silberman has the distinction of holding the all-time record of a $25 million listing that sold in MacDonald Highlands in Henderson in 2021. She and other luxury Realtors said that can be topped in 2022.
“I don’t think that’s out of the question,” Routh-Silberman said. “The properties are out there, and this could be the year to break that record.”
That was echoed by Ivan Sher, a Realtor with the Ivan Sher Group with Berkshire Hathaway HomeServices, Nevada Properties, who along with Routh-Silberman are among the leading luxury agents in Las Vegas.
“We have a new threshold in the luxury market,” Sher said. “Our pricing and price-per-square-foot has gone up and broken records, and I expect that to continue in 2022.
It’s going to be an exceptional year. I still think California is the best thing we have going for us and there are more people from California coming here all the time.”
Sher predicts there will be a sale in 2022 that surpasses $40 million and predicts it will come in the uber-luxury resort community The Summit Club in Summerlin. There are newly built homes already for sale that are worth $40 million-plus and others worth more than $30 million, he said.
“It doesn’t take too much creative thinking if our market continues, that we’re getting best-in-class billionaires wanting to move to our state,” Sher said. “Depending upon what they’re looking for, there will be options, now. At the beginning of 2021, we didn’t have anything to sell them.”
Sher said these buyers already have homes across the country. Many choose Las Vegas as their home for tax purposes with no state income tax, but they’re also attracted to the lifestyle, he said.
“There’s a newness and ease of living,” Sher said. “There’s proximity to anywhere you want to go. We have a phenomenal international airport. We have incredible dining and shopping and great entertainment. We have blue skies. It’s a great spot.”
Nationally, the luxury market has surged, and Sher said COVID has “shaken and continues to shake people,” he said. That helped accelerate the rate of people leaving California.
“People realize they don’t need to live in the state they work in,” Sher said. “Quarantining taught us we can work from anywhere in the world and continue our business. It opened the doors for a lot of people (who) were afraid to leave California, and most of them are leaving permanently and working in Las Vegas.”
Mitch McClellan, president and broker of Southern Highlands Realty, said the interest in luxury homes in Las Vegas will continue to be strong because of the in-state migration, but like others said the challenge will be a lack of inventory.
“We have a limited supply of inventory, and that’s reflected in the pricing,” McClellan said. “There’s more buyers than sellers. There’s been less inventory on new housing for quite some time, and they have not met the demand for many years. They’re not able to catch up on that supply limitation. On the high-end side, you had the COVID spike that brought more people here in a short period of time than ever before. Because of that, many of those homes were purchased. If you own a home and are contemplating a change, the problem is: If (you) sell, where can (you) go if (you are) staying locally (or) even going to another locale. That’s causing people to sit on their homes and not put them on the market. Until we get through this imbalance of supply and demand, 2022 will be interesting to see how it unfolds.”
Jensen said while he expects 2022 to be a great year for the luxury market in Las Vegas, he doesn’t see sales topping 2021 because of the lack of inventory.
“Buyers are having a harder time finding the stuff they like, and sellers are having a harder time deciding to sell because unless they’re leaving town, they don’t necessarily have anywhere to go.”
There’s 366 active listings of $1 million and above to start 2022, but there were 367 sales of $1 million and above in the fourth quarter, Jensen said.
“There’s roughly a three-month supply,” Jensen said. “And the cheaper and nicer stuff is going to sell faster.”
Veteran Las Vegas Realtor Zar Zanganeh, who is the managing partner of the newest brokerage franchise in the valley, the Beverly Hills-based The Agency, said he’s one that expects 2022 to be better than 2021. He recently took listings on luxury properties without even posting pictures on the MLS, people are already clamoring to see them because they lost out on bidding for other homes.
“We definitely feel it, based on calls we are getting from partners in other states that are sending clients our way and clients who are looking because they weren’t able to get properties they made offers on in 2021,” Zanganeh said. “Eighty percent of our buyers looking for homes north of $2 million are transferring from out of state. It’s primarily California, but other markets like Florida, Canada and Utah.”
Zanganeh said one trend line he’s seeing in luxury is how buyers are looking for smaller homes. There’s less demand for homes in excess of 10,000 and 12,000 square feet and more interest in those between 7,000 and 8,000 square feet, he said.
“People don’t want a massive house to take care of anymore,” Zanganeh said. “They’re not wanting movie theaters but more garage spaces and bigger great rooms. We’re seeing a bit of a return of formal dining rooms. People are looking for a more homey lifestyle than these massive 12,000-plus luxury homes.”
Zanganeh previously owned Luxe Estates and Lifestyles but is now part of a trend seen in 2021 of luxury agents switching to new firms relocating into the marketplace.
Zanganeh said The Agency was sending luxury clients from out of state to him and other Realtors in Las Vegas where it didn’t have a presence, and it made sense for the company that has 47 offices across the U.S., Canada, Mexico and the Caribbean to open one in Las Vegas.
“They have a global presence, and they have a huge marketing arm with a huge amount of clientele (who) have relocated from all over the country, especially California,” Zanganeh said. “The luxury market client is one that purchases home(s) all over the world, and they like a brand they have experience with.”
Routh-Silberman said she’s not surprised at the shifting marketplace that has see firms siphoning off talent like herself. Corcoran within its first six months in Las Vegas is “already a player” because of the agents it attracted, she said. “All of these big brands coming into the market are an indication that our market is growing up.”
Sher said having new players come into the market “elevates the real estate game.” Strong brands in Las Vegas is better for everybody, he added.
“There will be more coming,” Sher said. “This is just an indicator of what we have going for us and the business of luxury sales that they hope to be a part of. It says something about Vegas that everybody is moving here.”
In addition to companies coming into the market, there were brokerages that traded hands in 2021. HomeServices of America Inc., a Berkshire Hathaway affiliate, acquired Americana Holdings, the Las Vegas-based brokerage franchise of Stark.
“Vegas is going to be hot for a while, and the market is going to be strong,” Stark said. “Players are starting to see if they’ve not been in the market, they need to check it out.”
In late 2019, Synergy Sotheby’s International in Southern Nevada came under new ownership and was renamed Las Vegas Sotheby’s Realty International. Luxury Realtor Randy Char who previously had his own firm was named president in 2021 and moved his Char Luxury Team over to Sotheby’s.
“You’re seeing a lot of changes in the market,” added Char, who said the luxury market will remain robust. “Brands matter more as the consumer expects a higher level of service and more reach. You’re seeing a trend of consolidating with these big entities because of their collective marketing power, and they’re networking and reach. That’s not to say that boutiques and private companies aren’t great companies.”