average rent
average occupancy rate
ytd sales volume
YoY rent change
yoy occupancy change
individual transactions
QUARTERLY DEMAND
YTD: 676
QUARTERLY COMPLETIONS
YTD: 2,960
Average Monthly Mortgage Payment
Average Monthly Rent
In the third quarter of 2023, weakened demand pushed Las Vegas’ occupancy rates to a nine-year low, settling at 92.8%. This marks a 0.4-point decline from the previous quarter and a 1.6-point drop year-over-year. Within this context, Class A units somewhat defied the trend with a 93.3% occupancy rate, while Class B mirrored the market average at 92.8%. Class C units trailed the pack with occupancy at 92.4%. Submarket performance also displayed variations in occupancy, with Sunrise Manor/Northeast Las Vegas recording the lowest at 91.1%, while Central Las Vegas managed to buck the trend somewhat with a high of 94.2%. This landscape underscores the challenges facing the Las Vegas market amid a complex interplay of supply and demand factors.
In the third quarter of 2023, average apartment rents in Las Vegas experienced a 0.9% decline on a quarterly basis, marking the fifth consecutive quarter of flat or negative rent changes. On an annual basis, the market saw a 4.3% reduction in rents, ranking it the third-worst among the nation’s 50 largest markets, outpaced only by Phoenix and Austin. Across all product classes in Las Vegas, rents fell over the year, with Class B apartments registering the steepest decline at 5.2%. Classes A and C observed more moderate annual rent cuts of 3.0% and 3.6%, respectively. Every submarket in the area also experienced annual rent declines, ranging from a 5.8% decrease in both Henderson and Green Valley to a milder 0.7% drop in Central Las Vegas.
| Submarket | Average Occupancy | Annual Occupancy Change | Average Monthly Rent | Annual Rent Change |
|---|---|---|---|---|
| Central Las Vegas | 94.2% | -1.5% | $1,238 | -0.7% |
| East Las Vegas | 92.3% | -2.1% | $1,294 | -5.0% |
| University/The Strip | 93.0% | -2.7% | $1,241 | -1.8% |
| West Las Vegas | 92.4% | -2.2% | $1,322 | -4.4% |
| North Las Vegas | 91.2% | -3.2% | $1,484 | -4.7% |
| Sunrise Manor/Northeast Las Vegas | 91.1% | -2.9% | $1,249 | -3.1% |
| Henderson | 93.8% | -0.5% | $1,621 | -5.8% |
| Green Valley | 93.3% | -0.1% | $1,554 | -5.8% |
| South Las Vegas | 93.7% | -1.8% | $1,601 | -3.6% |
| Southwest Las Vegas | 93.7% | -0.7% | $1,689 | -3.7% |
| Summerlin/The Lakes | 92.7% | -0.9% | $1,710 | -5.1% |
| Northwest Las Vegas | 92.4% | -1.7% | $1,486 | -5.3% |
| Las Vegas-Henderson-Paradise, NV | 92.8% | 1.6% | $1,462 | -4.3% |
Units Under Construction
Units UC Delivering In the Next 4 Quarters
Transaction dollar volume for single asset conventional multifamily trades in Las Vegas totaled roughly $383.7 million through the 3rd quarter 2023, down about 84% year-over-year. Meanwhile, the number of transactions decreased about 87% compared to the same timeframe last year, with only 6 apartment properties trading hands so far in 2023. Meanwhile, the average price per unit in Las Vegas came in at roughly $217,600, down 18% annually. Las Vegas’ average price per unit landed below the norm for the West region ($301,000) but relatively equal to the U.S. average ($219,700).
* Trailing 4Q average PPU
* Preliminary Data from RCA – Individual conventional MF transaction $2.5M +
In the year spanning from August 2022 to August 2023, Las Vegas saw substantial growth across multiple employment sectors, signaling a resilient and diversifying economy. Leading the charge was the Leisure and Hospitality sector, with a remarkable 6.5% increase, adding 18,400 jobs. This sector’s performance is particularly notable given its significance to the local economy. Professional and Business Services followed suit with 6.0% growth, contributing an additional 9,700 jobs. However, the standout in terms of percent change was the Construction sector, surging by 8.2% and adding 6,400 jobs, reflecting a booming real estate and development market. Other notable sectors include Education and Health Services, which grew by 5.3%, and Government, posting a 3.4% increase. Overall, the metro added 48,600 jobs with an employment growth rate of 4.5%, indicating a positive trajectory in the labor market.
August Annual Jobs Created
August 23 Employment growth
August 23 Unemployment rate
3.8% us august rate
| Sector | Change from August 2022 to August 2023 | Percent Change |
|---|---|---|
| Leisure and hospitality | 18,400 | 6.5% |
| Professional and business services | 9,700 | 6.0% |
| Construction | 6,400 | 8.2% |
| Education and health services | 6,200 | 5.3% |
| Government | 3,600 | 3.4% |
| Trade, transportation, and utilities | 2,400 | 1.2% |
| Manufacturing | 1,800 | 6.1% |
| Information | 300 | 2.2% |
| Financial activities | 200 | 0.3% |
| Mining & logging | 0 | 0.0% |
| Other services | (400) | -1.2% |
The cost of living in Las Vegas presents a significantly more affordable picture compared to Los Angeles. According to the Cost-of-Living Index, Las Vegas scores a 95.9, considerably lower than Los Angeles. The most striking difference lies in housing costs, which are 55.4% less expensive in Las Vegas. Utilities and transportation also tilt in favor of Las Vegas, being 6.8% and 11.2% less costly, respectively. Even grocery and healthcare expenses are marginally lower, by 5.8% and 17.4%. Given these disparities, it’s clear that Las Vegas offers a more cost-effective living experience across multiple categories, making it an attractive alternative for those contemplating a move from expensive coastal cities.
95.9
$3,322
102.4
104.2
106.5
$449,600
Las Vegas’ apartment market is at an inflection point, influenced by a mix of positive economic indicators and challenges. On one hand, the rebound in the travel and hospitality sector has propelled employment growth, surpassing national averages and returning to pre-pandemic levels. This, coupled with an in-migration from higher-cost areas like California, has provided a boost to housing demand. However, several factors could temper this optimism. The influx of new supply is at the forefront, with over 6,800 units set to be delivered in the next 12 months, resulting in a 3.0% inventory growth. While this rate is moderate on a national scale, it’s significant enough to create competition, particularly in the Class A segment.
While challenges persist, the foundation for a resilient market is present. Employment gains, particularly in critical sectors like travel and hospitality, bode well for future demand. It’s reasonable to expect that as the market stabilizes, both occupancy rates and rent growth will see incremental improvement, albeit potentially remaining below U.S. averages. The metro appears poised to navigate through the transitional phase and likely has the worst of its net move-outs behind it.
