Las Vegas Homebuyers Are Bidding Up Prices in Collapsing Economy
Nowhere is the widening gap between real estate and the real economy more apparent than in Las Vegas, where tourism is in ruins, wages are plunging and home prices just keep rocketing higher.
The median price for a single-family house in August jumped almost 10% from a year earlier to $335,000, according to a report from the Las Vegas Realtors. By comparison, annual price growth in February, the month before Covid 19 emptied out casinos, hotels and restaurants, was 6.7%.
For buyers from high-cost markets in California or New York, drawn by record-low mortgage rates and Nevada’s lack of income tax, a wager on a Vegas home looks like a sure thing right now. But in less than a year, those bets could sour as owners resell those properties and send prices falling.
Among large U.S. housing markets, Las Vegas is the riskiest by a wide margin, according to an analysis by CoreLogic Inc., which projects that by next July, prices will be down by 7.8%. So far, values have been pushed up by a shortage of supply, with available listings falling 40% in August from a year earlier.