More Building to Come in Las Vegas
Even though home prices in Las Vegas are posted at lower rates than last year, lower-end homes have increased in value slightly. According to the New York Times, real estate in Las Vegas is looking promising for sellers, where purchasing a home for $150,000 is challenging for some potential buyers.
According to Standard & Poor’s/Case Shiller Home Price Index, Las Vegas continued to post average home prices below levels found during January 2000. The city’s July 2012 level was at 94.57, a 0.7 percent change since June and a 1.5 percent change between June and May. These values showed a negative 1 percent change year-over-year.
Since 2008, the development business in Nevada has been only a fraction of what it was before the housing bubble burst, but some have survived the fall. Nevada’s housing market has posted an increase in sales, although development is still slow.
The Caida Group, a Las Vegas-based multi-family real estate development company, began purchasing distressed property and partly built condo projects that became available in 2007. Over the next five years, the group plans to built 4,000 to 5,000 units in Southern Nevada, while simultaneously expanding into Northern California and Phoenix.
“What we thought was a bad time turned out to be the best times,” said Eric Cohen, the co-founder and managing director. “While everyone had troubled assets and legacy loans, we got to focus on distressed condo products that became available.”
The growth of commercial development in Las Vegas has not looked good over the past few years, but new developments are going up in the city. Similarly, many tech companies are being attracted to the area. As is the trend, with commercial growth, comes residential.
According to The Associated Press, home builders in the United States spent more on construction in August, which suggests there may be an upcoming housing rebound is on the way. The Commerce Department reported on October 1 that overall spending during construction decreased 0.7 percent from August to July, which was the second straight monthly decline.
Spending on residential projects in August rose 0.9 percent, which pushed spending to an annual rate of $273.5 billion, an 18 percent increase year-over-year. Spending on apartment construction rose for the 10th month in a row, while spending on single-family homes rose for the fifth straight month, according to the publication.