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.
Sources: RealPage; BLS; MSCI; The Council for Community And Economic Research (C2ER)