In today's Las Vegas real estate market, a common lament is that we have so much inventory because investors are trying to sell homes that were purchased during the frenzy of 2004. After a couple of years of rental income, and now in the middle of a market correction, investors are trying to lock in impressive gains (or limit their losses) and move on to their next opportunity. This has resulted in a high number of vacant homes on the market.
While checking the vacancy rate this afternoon, I was surprised to find that the total number of vacant and tenant-occupied properties outnumber those that are owner-occupied. Out of 21,639 single-family listings in the Las Vegas valley (Las Vegas, Henderson, and North Las Vegas), only 9,759 (45.1%) are the personal residence of the owner. Here's how the numbers break down:
Single-Family | Condo | Townhouse | Totals | |
Total Listings | 21,639 | 4,081 | 1,644 | 27,364 |
Vacant | 9,667 (44.7%) | 2,327 (57.0%) | 788 (47.9%) | 12,782 (46.7%) |
Tenant-Occupied | 2,223 (10.3%) | 744 (18.2%) | 193 (11.7%) | 3,160 (11.5%) |
Owner-Occupied | 9,749 (45.1%) | 1,010 (24.7%) | 663 (40.3%) | 11,422 (41.7%) |
How many of the vacant listings belong to out-of-state investors? I looked at a sample of 553 listings in Henderson, and 194 of them (35.1%) belonged to owners whose address was outside of Nevada. If that percentage holds true, then 4,486 of the vacant listings are owned by non-Nevadans.
This glut of vacant and investor-owned homes will continue to put downward pressure on market prices of Las Vegas real estate. Many buyer's agents take the path of least resistance and show vacant homes before scheduling appointments with owner-occupants. Investors, looking at the sale from a financial rather than emotional perspective, are more likely to price their homes realistically. Until inventory returns to normal levels (12-14,000 homes), sellers of owner-occupied homes must have an aggressive pricing and marketing plan to succeed in today's competitive Las Vegas real estate market.
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