Rents are dropping in Las Vegas Valley, study says
Rental rates are dropping in the Las Vegas Valley from a glut of new supply coming on the market, according to a new study from Redfin.
The median asking rent for all bedrooms in the valley was at $1,475 at the end of September, a 1.5 percent decrease from August and a 1.7 percent increase from September of last year, according to Redfin. Many Sun Belt cities are starting to see large month-over-month rental rate drops, including Jacksonville, Florida, (-11.3 percent) Raleigh, North Carolina, (-10.6 percent) and San Diego (-10.4 percent).
Rental rates are fluctuating wildly right now depending on where you live, said Redfin senior economist Sheharyar Bokhari.
“Rents remain stable nationally, but could look very different depending on where you live in the country,” he said. “On the East Coast and in the Midwest, there hasn’t been as much building activity, so asking rents are rising. Meanwhile, if you’re in a Sun Belt city where construction boomed following the pandemic, rents are now falling pretty fast.”
Las Vegas building boom
Las Vegas is currently adding a record number of apartment units to its total as a wave of pandemic-era financing kicked off a building boom in the city. But Jeffrey Swinger, an executive vice president for multifamily investment sales with Colliers International, said in a previous interview with the Las Vegas Review-Journal that the pipeline dries up quite quickly after this year.
“We’re probably going to have a period of about two years where nothing is built, so it’s going to get even worse,” he said.
Apartment complexes across the Las Vegas Valley are offering sizable concessions right now to entice renters, including multiple months of free rent as vacancy rates rise across the board.
Redfin also reported that asking rents for newly constructed apartments across the country dropped in the second quarter of this year to the lowest level in more than two years.
“Monthly asking rents for new apartments hit a peak of $1,889 in the first quarter of 2022, but have trailed off since, as the number of newly constructed apartments shot up,” read the report. “Apartment completions rose 18.7 percent in the first quarter year over year to reach the highest number in over a decade.”
Bokhari said this is a case of supply and demand.
“Rents for new apartments will likely fall a little more this year, because there are still a ton of new buildings being completed,” he said. “With new apartments popping up everywhere, owners are competing with one another to find tenants by reducing rents and offering concessions like free parking. If you’re a renter in a market like Dallas or Nashville, where construction has been booming, there are likely deals to be found.”
The cities with the biggest rental increases year over year are Washington, D.C. (12 percent), Virginia Beach, Virginia, (11.3 percent) and Cleveland (11.1 percent).
A recent survey of renters Redfin found 31.6 percent of respondents said housing affordability is a top-three issue for them in the upcoming U.S. presidential election and that “Kamala Harris voters were slightly more likely than Donald Trump voters to rank housing affordability as a top issue.”
Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.