Las Vegas Sun

October 21, 2017

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Apartment rents rise for 15th straight month as valley’s housing market tightens

Image

Steve Marcus

A view of the Harbor Island Apartments on Harmon Avenue Tuesday, April 25, 2017.

The impact of a vanishing housing supply in Southern Nevada ripples its way through the local rental market this summer with little relief in sight.

Driven by the area’s tightening roster of available homes and an increase in premium units, average one-bedroom apartment rents in Las Vegas climbed in June for the 15th consecutive month. Prices also bumped upward in Henderson as both buyers and renters feel a squeeze not seen since pre-recession times.

“The for-sale market continues to experience rising prices, higher sales volumes and dwindling availability,” Applied Analysis principal Brian Gordon said. “At the same time, the apartment market continues to post relatively low vacancy rates as rents increase.”

Reports from Zumper and Apartment List show slightly different pricing for the local market, in part because Zumper separates Henderson’s rates. Zumper shows the average Las Vegas apartment renting for $800 per month, a jump of 1.3 percent from May. Two-bedroom units held their price from last month at $980 per month.

According to Apartment List’s report, the median one-bedroom apartment in Las Vegas rents for $880, while the two-bedroom median stands at $1,090. The one-bedroom rate increased 0.5 percent from a month ago.

Gordon pointed to the southwest valley as an example of increasing stock of high-end apartment units partially driving price growth.

“New apartment projects have been met with respectable leasing activity, and current conditions suggest those trends should prevail through the balance of the year,” Gordon said.

Zumper found aggressive rate growth in smaller units in Henderson. Listing the city at No. 39 among its most expensive rental markets in the country, Henderson’s one-bedroom units averaged $980 a month. That’s up 1 percent from May but 15.3 percent year over year. Las Vegas checks in at No. 58 on Zumper’s list.

Two-bedroom units in Henderson are renting for $1,110 per month on average. That figure held steady from a month ago.

With Southern Nevada in the midst of what local Realtors call a housing crisis, rental rates likely will rise moving forward. Less than a three-month supply of resale housing exists in the region, well below the six-month stock considered healthy.

“From a big-picture perspective, the market is experiencing strong population growth, impressive employment growth and increases in average wages,” Gordon said. “These factors suggest that there should be increased demand placed on the housing market. At the moment, all segments of the housing market appear to be benefiting — new homes, resale homes and apartments.”

San Francisco maintained its status as the most expensive rental market in the nation, with one-bedroom units averaging $3,450 per month and two-bedroom units at $4,500 per month. New York, San Jose, Washington, D.C., and Boston comprised the remainder of the top five priciest rental markets in the country.

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