This past weekend was the Real Estate Expo at the Cashman Event Center. Before starting on Friday, they hosted a seminar that discussed the housing outlook for 2016 for Las Vegas. Dennis Smith, President of Home Builders Research, presented the seminar. During the first half, there was a panel who answered questions dealing with home builders, the market, and economic impacts. The three panelist were Frank Wyatt (2016 President of Southern NV Home Builders Association and Owner of Pinnacle Home), Michele Caprio (CEO of Great Las Vegas Association of REALTORS), and Bob Potts (Research Director of NV Governor's Office of Economic Development).
The Las Vegas real estate market has remained fairly stable the last few months with the average resale home price hovering around $220,000. In addition to a stable market, it also continues to grow with 3% more homes being sold in March 2016 vs March 2015. Michele also noted an indicator for her is the growth in GLVAR membership. She said they are adding about 150 new members each month. They are currently around 12,000 members and project to end up with 13,000 by the end of the year. In 2008, they were at a low point with only 9,000 members. Michele's vision for the GLVAR is continued education, develop advocates, and ensure all REALTORS are professional and honest.
Bob Potts was able to share some valuable insights about the Las Vegas market and what the governor is trying to accomplish. Unemployment is at 5.6% and last year 22,800 jobs were added, which shows job growth and an improving economy. Las Vegas is known for the gaming and tourism industry, but they are working toward diversifying the economy by expanding companies and bringing in new companies. They are also focusing on workforce development and working with companies to create a more educated workforce in the areas that are needed. They hope to start internship programs at major companies. Faraday and Hyperloop will help to build out the Apex Industrial Park in North Las Vegas. They are also focusing on data centers. Although they do not hire many people, they do spend a lot of money to keep the centers maintained. Another industry they are focusing on is the health and medical industry. There are two new medical schools being built. The ratio of the population to health care professionals is much lower than the rest of the country. Las Vegas is only about 2/3 of where they should be in comparison. The key will be to ensure the graduates are connected with the open vacancies so they don't leave the area. Las Vegas also hopes to grow healthcare tourism because it will lead to money outside of the economy coming in. One of the last questions he answered was about the raised minimum wage in California. Although Las Vegas wouldn't see a raised minimum wage, the area should see an increase in businesses wanting to relocate from California to Las Vegas. The small to medium sized businesses will be the most impacted in California. He said he did not have any data on it yet, but he has noticed an increased number of inquiries about relocation.
Frank Wyatt spoke about the home builder (new home) market. The new home market is fairly stable, but seen year over year increases in the number of new homes sold in the last few years. The projections show them to continue with stable growth. The two biggest challenges are the amount of available land and the cost of each lot.
Another topic that came up was the number of new apartments being built near the new IKEA. There will be almost 7,000 new units that will be opening at the end of 2016 and early 2017. With the large influx of new apartments, the market for the southwest area will become overcooked. Many developers had the same idea at the same time. That being said, the new apartments will have much higher rent. In general, rent has increase 5-6%, which is close to the peak from 2007.
Overall, the housing outlook for resale and new homes seems fairly positive, especially if the mortgage rates continue to remain low. The economic outlook for Las Vegas also seems positive as the state works towards a more diversified economy.