January 24, 2020 - 1:40 pm
The luxury new home and existing home market in Las Vegas continued on its hot streak in 2019 and vastly outperformed the rest of the housing market.
There were 299 closings of new luxury homes, town homes and condos of $1 million and above, a 23 percent gain over the 244 closings in 2018, according to Home Builders Research. That contrasts to the overall new home market, whose overall closings were down 1.7 percent in 2019, the firm noted.
That trendline was also strong in the existing single-family home market, where there were 507 closings of $1 million and higher, up 16 percent from 435 in 2018, Home Builders Research reported. The Greater Las Vegas Association of Realtors reported existing single-family home sales were down 0.6 percent.
The market for new and existing homes priced down to the $750,000 and above market was strong as well but didn’t quite match what’s happening at $1 million and above.
Home Builders Research reported there were 692 sales of new homes and town homes and condos priced at $750,000 and above, an 8 percent increase over the 643 in 2018.
In the existing home market, there were 1,121 sales of single-family, condos and town homes at $750,000 and above, a 10 percent gain over the 1,017 sales in 2018, the firm reported.
“Las Vegas is growing up,” said luxury Realtor Kristen Routh-Silberman. “There’s more sophisticated, wealthier buyers coming here, and even the people who live here that bought homes in 2006 are ready to move up to that million-dollar market. There’s not just retirees coming here any longer. They’re coming from Southern California — L.A. down to San Diego — and the luxury market will continue to be strong in 2020.”
Home Builders Research President Andrew Smith said it also reflects that wealthier people “feel good about the Las Vegas market” and how the economy is strong and attracting sports teams, such as the Raiders.
“People can sell their house in California and come here and buy a much larger nicer home. An average home in California is like a mansion here. Those people able to buy a $1 million home see good things coming for the future in Las Vegas. That’s a positive sign when wealthy people want to live in your city.”
Routh-Silberman, a Realtor with Synergy/Sotheby’s International Realty and master listing agent for MacDonald Highlands who works both with luxury new and existing homes, said the bigger preference for wealthy buyers is for new homes with the latest technology and finishes and modern color palettes.
“The resale homes selling first are the remodeled ones,” Routh-Silberman said. “A person that’s going to list their house for sale needs to remodel it with at least the kitchen and bath to be competitive with the new-home market. Nobody wants carpet anymore. Everyone wants large-format tile or engineered wood. No one wants to take on anyone’s issues with their homes. You can do some great things in the $10,000 to $25,000 range. A great coat of paint goes a long way. Get rid of all of the Mediterranean colors and go to crisp and clean white palette.”
Routh-Silberman said her first contract for 2020 was for a new modern custom home in MacDonald Highlands for $3.5 million that’s already under construction and will be finished in May. The demand has been strong for their Richard Luke Collection there, which is going to start construction on another 10 homes in February, she said.
People who live in Las Vegas who bought prior to the Great Recession are ready to move, she said.
“This couple lives in Anthem Country Club and wanted new modern going from a $1 million to $2 million range to a $3 million range, but the stuff in Anthem was too old,” Routh-Silberman said.
Forrest Barbee, a corporate broker with Berkshire Hathaway HomeServices who works in Nevada, Arizona and California, said the demand is strong for the $750,000 and above category and speculated that sales would be even higher if builders could meet that and have enough labor to build homes quicker. Buyers prefer the latest energy efficiency and smart home technology of new homes, but some are impatient, he said.
“You still have people who won’t wait 18 months for a new home and when they get frustrated and take a look at the resale market,” Barbee said. “The challenge is they are old. We did Tuscany style here forever, but HGTV has moved us into modern and contemporary, and a lot of the resales out of the box aren’t HGTV-ready. As time goes on, we are seeing more of that renovated. Some buyers are going back and negotiating really hard because they know they’re going to have to put $100,000, $200,000 or $300,000 into a major renovation.”
Dan Coletti, owner of Sun West Custom Homes, said people can’t underestimate having interest rates at under 4 percent making it more attractive for even wealthier people to buy. They can buy more home with less payment per month, he said.
“In the luxury market, the interest rate has a bigger impact because if you are borrowing $3 million and interest rate is 1 percent lower, you’re saving a lot more money than if you are borrowing $300,000,” Colleti said.
Wealthy buyers are also driven by high consumer confidence with a soaring stock market reaching record highs.
“And in the new home market the innovations and the way we can make it look today it looks like you get a lot for your money,” Coletti said.
The strength of the new luxury market is evident by a $12 million mansion under construction in Southern Highlands without even having a buyer in place.
The spec home is the largest new nine-bedroom mansion for sale with more than 18,000 square feet on about 1½ acres, according to Bob Barnhart, owner Luxurious Real Estate, who’s listing the home for Beverly Hills developer, Yossi Attia of the Atia Group, who’s making a foray into Las Vegas after building luxury mansions in Beverly Hills and Bel Air. The architect is Las Vegas-based Quinn Boesenecker of Pinnacle Architect Studio.
“The developers are coming here because they see the money coming in and growth of Las Vegas,” Barnhart said. “With the sports teams like the Raiders and new hotels coming out of the ground, I think they see opportunity and the dollar going further and need for quality construction.”
Barnhart said they chose Southern Highlands because they wanted to build a Mediterranean-style home like they’ve done in California, and that master plan caters to that style.
“This builder developer is well-versed in Mediterranean-designed estates like you see in Beverly Hills,” Barnhart said. “They saw the opportunity to obtain almost an acre-and-a-half in Southern Highlands come across with a design that was large and grand and estate-like.”
A mansion like the one under construction for about a year and that will be completed in four to five months would cost three times as much in Beverly Hills, Barnhart said.
The home with a six-car garage has two main stories and a walk-out basement that has a poker room, hair salon, movie theater, ultra lounge, day spa, workout room and two guest suites.
The main floor has a secondary master bedroom, office, living room, family room, formal dining room, kitchen, chef’s kitchen and two other guest suites.
“The main kitchen opens to the family room, and it has more of a formal entrance to that goes into the dining room,” Barnhart said. “It has a walk-in wine cellar. There are a lot of windows and pocket doors across the back of the house. It opens up to the golf course and swimming pool. It has a walk-thru garden.”
The upstairs three guest suites and a master bedroom, Barnhart said. The home has a double staircase and fireplace in the center and looks dramatic when walking through the front door with a large skylight, he said.
“What stands out is the grandeur of the home,” Barnhart said. “It’s impressive. Most custom homes are tight side-by-side with no backyard. This has a porte cochere and motor court in the front of the house, sports court and two-level pool. It has that estate feel that’s hard to find in Las Vegas anymore.”
Barnhart said Mediterranean is a timeless design that many buyers like, especially those from Southern California. He said California buyers have expressed the most interest so far.
“It’s the biggest largest newest home available in Las Vegas, and someone who’s wealthy, an entertainer or athlete is going to want this house,” Barnhart said.