While Las Vegas may be known primarily for the glitz and glamour of the Strip, it’s a metropolis of many and varied neighborhoods far beyond the neon lights.
The nation’s 25th-largest major metro area is home to about 2.3 million, and it’s growing steadily, with some 40,000 a year arriving from all over the world to set up house. Its neighborhoods aren’t the only thing that are diverse and growing; after learning some hard lessons about being reliant on tourism, the city has diversified its industry, including a growing tech scene. Google is investing $600 million in a new facility in suburban Henderson, and the University of Nevada has opened a new tech incubator.
Las Vegas presents strong prospects for the property investor, with home prices on a dramatic climb. The median sales price of previously owned single family homes, the better part of the market, was a record-breaking $395,000 in June. As for new homes, the median Southern Nevada sale price was a record-setting $402,990 in May. Typical rental rates jumped by over 17 percent year over year, the second-highest growth nationally.
Buyers looking to invest in rental properties in Las Vegas should get familiar with some of its many neighborhoods, no matter what their budget when shopping for a rental property, since there are homes to suit every level of investment. Here are four areas to investigate.
Summerlin offers outdoor activities and a strong rental market
About 20 minutes from the Strip, Summerlin is one of the most desirable rental neighborhoods in the city. Many locals head to the open-air, high-end mall for the shopping and the good restaurants, and stick around to watch the Rolls Royces and Bentleys roll by.
Many who can’t afford to buy a home in Summerlin find they can rent one for a reasonable price.
“The average rental for a cookie-cutter house here is about $2,000 a month, and that’s up 30% over the last two or three years,” says Trevor Steadman, Mynd’s Nevada corporate broker and realtor. “There’s just no inventory. People are dying to get into these communities.”
Mountain's Edge boasts good schools
One of Vegas’s newest developments, springing up over the last 15 years or so, Mountain’s Edge sits to the southwest, a bit farther from the Strip. Homes are still going up throughout this district, which is spreading increasingly farther south. Many blue-collar workers make their homes here, attracted by good schools and homes that can rent for less than $2,000 a month. History buffs love to visit the petroglyphs left behind by Native American tribes millions of years ago.
Rhodes Ranch caters to high-end buyers
At the entry to the gated community of Rhodes Ranch stands a sign in the same lettering as the iconic one in Hollywood, spelling out the name of this super-desirable neighborhood and hinting at its glamour. Known for opulence, it’s home to some of the well-paid performers on the Strip. Visitors can expect to have to pass multiple security guards to get in.
“A lot of investors, especially in Vegas, purchase large homes in neighborhoods like this, get good long-term tenants, and then retire to them when the time is right,” says Steadman.
North Las Vegas has a big upside
“This is the up-and-coming neighborhood,” says Steadman. It may still get a bad rap as a dicier part of town, but that’s changing.
North Las Vegas is home to a lot of the new construction. In many cases, the owner buys a home and puts it straight on the rental market. According to Steadman, buyers can find a four-bedroom, two- or two-and-a-half-bathroom house in the area of $350,000 and get enough rent to cover the mortgage payments, and even some positive cash flow.
The shopping centers, schools, and other essentials are sure to follow all the housing that is sprouting up here, making this area more and more desirable to home buyers and investors.
They haven’t built the big shopping centers yet, though they will pop up around it, and these are some of the last unbuilt tracts of land that are close to the city center, only adding to the area’s potential.
“It’s like Summerlin 10 years ago,” says Steadman.