Las Vegas Housing Market Update - January 2023
Market Picks Up Slightly to Start the Year
At the end of January, rental market inventory was at 3,410 rental properties. This represents the first decrease in rental inventory since March of 2022. While not a substantial drop from the previous month, this drop in rental inventory shows that the market is improving slightly. In January of 2023, 2,023 rental properties were leased across the Las Vegas Valley. This is an 28.7% increase from January of 2022 (1,572 properties). The number of rental properties listed in January of 2023 was 1,755. This is a 39.5% increase from January of 2022 (1,258 properties). The median price of rental properties across the valley in January of 2023 was $1,900/mo. This is the exact same amount as the median price in both January and December of 2022. The average price of rental properties in January of 2023 was $2,096/mo. This is a 0.4% increase from January of 2022 ($2,088).
Here are the key takeaways for any real estate investor in the current market:
A) Rent growth, both month over month and year over year, have flatlined. With less than a percentage point of difference, it is unlikely that rent increases from both turnover of 1-year tenants and lease renewals will be possible. For owners who want to increase the rent they are receiving on their properties, they are likely going to need to make upgrades that would justify a rent increase. This can include new flooring, updated appliances, and more. Check out one of our previous blogs on ways to improve the attractiveness of rentals for more information: 5 Things That Will Make Your Rental More Attractive to Tenants
B) Although inventory is decreasing, it is likely that there will be a large influx of first-time rental property owners, as increased interest rates and a slow real estate market have forced some homeowners to list their properties for rent to cover their bottom line. These first-time entrants to the property management market will cause increased competition in an already crowded environment. With prospective tenants having so much choice and freedom in finding a new home, it is important to make sure you have a property manager who is able to drive traffic and attention to your investment properties.
No matter the market conditions, every property is unique and needs a proper market analysis to determine what the current fair market rent would be. If you have questions about where your property fits into the current rental market, please reach out to us.
