How soon could Las Vegas Valley run out of land for new homes?

Tina Frias, chief executive officer for the Southern Nevada Home Builders Association, said the findings should be a catalyst for keeping the area’s housing stock within a healthy equilibrium of supply and demand.

“At the end of the day, from a homebuilding perspective, we need more land. So it’s important for us to have the land to develop in the first place,” Frias said in response to the data from Applied Analysis.

Clark County confirmed to the Las Vegas Review-Journal that the federal government owns 88 percent of all land in the county, and the Bureau of Land Management manages more than half of that. The BLM’s Southern Nevada district confirmed that it manages 2.6 million acres alone in Clark County. The BLM recently sold 505 acres to a local developer for $55 million who is planning a 3,000-plus master planned community close to Red Rock Canyon.

Gov. Joe Lombardo recently endorsed the bipartisan Accelerating Appraisals and Conservation Efforts Act from Rep. Susie Lee, D-Nev., in an attempt to cut through federal red tape regarding accessing land for development.

“Nevada families deserve access to attainable housing — and that begins with eliminating governmental barriers to development,” Lombardo said in a statement.

A spokesperson for the BLM’s Southern Nevada district said the Southern Nevada Public Land Management Act — which was originally passed in 1998 — directed the BLM to sell public lands within specifically designated boundaries in the Las Vegas Valley. To date, almost 44,000 acres have been “disposed” within the boundary through sales, leases and patents, the spokesperson, and another 27,000 acres of land is still available for disposal.

‘Housing crisis’ driving up prices

Numerous real estate experts and analysts told the Review-Journal that a lack of available land and government bureaucracy are some of the main reasons the valley is now in a “housing crisis” that is driving up real estate prices.

Nicholas Irwin, a UNLV assistant professor of economics and researcher at the Lied Center for Real Estate, said the valley’s population is projected to continue to grow, so the need for more developable land is paramount.

“We need to keep building new houses in general, increasing supply is the best way to tamp down prices or at least prevent rampant price appreciation,” he said.

Redfin estimates the median home price in the valley is up 9.2 percent from this time last year to $435,000. This means home prices have essentially gone up $100,000 in the past three years, while sales have rapidly declined.

Brian Gordon, a principal at Applied Analysis, said developing an adequate supply of housing is an issue that’s not going away anytime soon.

“The fact that people are still continuing to move into the Las Vegas Valley would suggest there’s a continued demand for housing,” he said. “And that’s in spite of the fact that mortgage rates remain elevated and a substantial number of people are continuing to remain in place given the elevated cost of borrowing today relative to where it was just a few years ago.”

Frias said the valley housing stock comes down to the three L’s: lumber, labor and land. She cited a scarcity regarding land as a major issue, saying so many people got into homes during the pandemic, when interest rates were incredibly low, and now they are content to sit on the properties they purchased, which takes them out of the resale stock.

“Right now we are in a pretty unique circumstance. Buyers are sitting on homes that have interest rates that are 4 percent or lower, and they are not likely to give up that interest rate, so that impacts inventory. And so with a lack of inventory and higher mortgage rates than they were a few years back, it makes it difficult to align housing options with consumer demand.”

Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.