In recent years there has been a fundamental change on the supply side of vacant land in the Mesquite NV real estate market including whole subdivisions, commercial sites, and single family home building lots. Prior to the north side take downs, Mesquite had a very limited supply. Today with those take downs completed and the land now open to and owned by many speculators, the free market, supply and demand will dictate prices.
This week the City of Mesquite announced another proposed public land swap, which will eventually add to the existing supply side. Another 4900 acres. Combine this to the roughly 4000 acres, encompassing Pulte Del Webb/Sun City/Canyon Crest properties, and the Lincoln County land, 13,300 acres (Toquop Township) we will have some where in the neighborhood of 22,000 acres of develop-able land in the market. Clearing this market will require time and competitive prices. Mesquite NV builders took out 209 permits during the first six months of 2008 to build new homes.
Mesquite Nevada real estate is very unique in that we are surrounded by public land, which can and is sold off to meet future needs. The Toquop auction which involved 21 sections or approximately 13,300 acres of land was sold at public auction back about four years ago. They paid around 47 million and plan to develop as many as 40,000 housing units as well as much more commercially zoned competition. This property has a six mile border with the City of Mesquite to the North. The current city maps show at least six streets running into the property.
The past run up in prices was a combination of funny money being thrown at consumers, speculators, and mindless frenzy. It was also partially based on the very limited supply side of the land in the market. That has changed. Today we have a number of whole subdivisions going into foreclosure. Today, at least from my point of view, it is almost impossible to know how many years it will take absorb this supply.
The absorption rate will depend on cost basis as it comes out of foreclosure and the prices of the final product offered to the consumers. In other words, lower new home prices, at the very least, a highly competitive new home sales market for years to come. This supply of new home sites at lower prices will likely translate into future challenges to existing home price appreciation.
The difference here is the unlimited supply of public lands, and the city government dealing in real estate.
Chris W. Miller
ERA Brokers Consolidated
Mesquite NV 89027
702 346-7200
435-862-5951
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