quarter andd Figure % (2009 Q3) 15.68% Drop $741 (2013 Q1) Average Vacancy Rate (%) Average Rent

Transcription

1 Lied Institute Report on featuring data from the Center for Business Economic Research Volume 17, 1 st Quarter, 2017 in 1 st Quarter 2017 The Las Vegas apartment market saw a slight increase in the average asking rent a decrease inn the vacancy rate this quarter, according to data from our apartment survey, collected by thee Center for Business Economic Research(CBER). This was the ninth consecutive quarter wheree the average asking rent increased. This quarter saw a 0.6 percent increasee in the average askingg rent the average asking rent is now $909. Asking rents are up 5.4 percent sincee 2016Q1( ($867). The Las Vegas average asking rentt is now 4.3 percent higher than it s peak inn 2007($876). The average asking rent is also 23.3 percent higher than it s low in 2013( ($741). Thee Las Vegas apartment market vacancy rate saw a decrease for the second consecutive quarter d was 7.2 percent for 2017Q1. This represents a 0.44 percentage point decrease on a quarter too quarter basis a decrease of 0.8 percentage pointss on a year over year basis. The vacancy ratee is now 3.7 percentage points lower than it s peak in 2009Q3(10.96%), but 2.7 percentage points higher than it s low in 2006Q1 (4.5%). Figure 1 Figure 2 Average Rent Las Vegas Metro Apartment Rental Rates 15.68% Drop $876 (2007 Q4) $914(2017Q1) $741 (2013 Q1) Date (Quarter 1, Quarter 1, 2017) Source: CBER Apartment Survey Average Vacancy Rate (%) Las Vegas Metro Apartment Vacancy Rates 10.96% (2009 Q3) 4.53% (2006 Q1) Date (Quarter 1, Quarter 1, 2017) Source: CBER Apartment Survey 7.20 % (2017 Q1)

2 Page 2 Figure 3: Apartment Rental Rates in Las Vegas* Rent Q No Data Greater Than *Figure based on CBER Apartment Survey 37 zip codes saw an increase in average asking rents while 14 zip codes saw a decrease in average asking rents this quarter. The southeastern Henderson region saw some of the most significant increases in average asking rents this quarter. The zip code saw the largest quarterly increase in asking rents with a 7.1 percent($63) increase. Also in the southeastern region, the 89011, 89002, zip codes saw average asking rents increase more than 2.5 percent. Boulder city, or the zip code, saw asking rents dip 1.1 percent($10) was the only zip code in the southeastern region where average asking rents decreased. The northwestern region saw varying changes in asking rents this quarter. While the zip code saw a 4.1 percent increase($41), the 89149, 89166, zip codes all saw slight decreases. The southwestern saw about 2 percent gain in asking rents among all zip codes in the region. The Strip area, or the zip code, saw the largest quarterly decrease in asking rents this quarter with a decrease of 9 percent($71). All regions had consistent year over year growth among all their zip codes. Only the 89156, 89012, zip codes have average asking rents that are down since 2016Q1. The zip code had the largest annual growth with a 12.4 percent($162) increase.

3 Page 3 Figure 4: Apartment Vacancy Rates in Las Vegas* Vacancy Q No Data *Figure based on CBER Apartment Survey 34 zip codes saw a decrease in the vacancy rate while 14 zip codes saw an increase in the vacancy rate this quarter. The zip code recorded a vacancy rate of 0.0 percent as none of the 272 surveyed units were reported units as vacant. Excluding this zip code, the zip code saw the largest quarterly decrease in the vacancy rate with a 4.8 percentage point decrease. The zip code has been seeing high quarterly fluctuations in the vacancy rate throughout the last year. The zip code was the only other zip code where the vacancy rate decreased by more than 2 percentage points. Much of the southern region saw decreases in the vacancy rate of about 1 percentage point. All other regions saw relatively small changes in the vacancy rate of less than 1 percentage point. The 89084, 89149, 89156, zip codes were the only zip codes where the vacancy rate increased by more than 1 percentage point. All regions experienced fairly consistent decreases in the vacancy rate on a year over year basis. Once again, the zip code saw the largest decrease in the vacancy rate on a year over year basis with a decrease of 6.9 percentage points since 2016Q1. Only eight zip codes spread throughout Las Vegas have seen increases in the vacancy rate on a year over year basis. The vacancy rate in the zip code increased 2.1 percentage points since 2016Q1 the largest annual increase of any zip code in Las Vegas.

4 Page 4 Figure 5 Figure 6 Figure 7 Figure 8

5 Page 5 Most apartment types saw very small changes of less than one percent in their asking rents. Furnished two bedroom two bathroom aparments saw the largest decrease in asking rents with a decrease of 1.1 percent($10). Three bedroom apartments were the only other apartment type that saw a quarterly decrease as they had a decrease of less than 1 percent($2). Studio apartments saw a very small increase of less than 1 percent($4). Unfurnished one two bedrooms also saw small increases of less than 1 percent($3). Furnished two bedroom one bathroom apartments saw the most significant increase in asking rents with an increase of 5.3 percent ($54). Furnished one bedroom apartments also saw a significant increase in asking rents of 4.9 percent ($37). Nearly all apartment types saw year over year increases in asking rents. The average asking rent on furnished two bedroom two bathroom apartments decreased less than 1 percent($3) year over year. All other apartment types saw year over year increases in the asking rent of greaterr than 1 percent. Furnished studio apartments increased 6.0 percent($38) unfurnished studio apartments incrased 4.2 percent($25) since 2016Q1. Furnished one bedroom apartments increased 1.8 percent($14) unfurnished one bedroom apartments increased 5.1 percent($39). Unfurnished two bedroom one bathroom apartments saw the largest year over year growth of any apartment type with an increase of 6.2 percent($48). Unfurnished two bedroom two bathroom apartments also saw an annual increase of 5.1 percent($47). Three bedroom aparments saw an above average increase of 5.6 percent($60). Average Rent Las Vegas Metro Rents by Apartment Type Date (Quarter 1, Quarter 1, 2017) All Type One Bed Two Bed, Two Bath Source: CBER Apartment Survey Figure 9 Figure 10 Studio Two Bed, One Bath Three Bed

6 Page 6 Apartment complexes, to a certain extent, compete with individually owned units, which mostly consist of single family homes, townhomes, condominiums. MLS rental leases proxy this competition. MLS leases decreased, which typically does not happen the first quarterr of each year. This was the second consecutive quarter where MLS leases decreased the lowest number of leases since 2009Q2. There were 5,326 rental leases in 2017Q1 609 less than 2016Q4 1,005 less than 2016Q1. Of the 5,326 rental leases, 3,403 were single family homes 1,923 were multifamily homes. Figure 11 Median price per square footing on MLS rental leases increased for both single family multifamily homes. Multifamily homes rented for $0.888 a square foot in 2017Q1 a $0.01 increase from the previous quarter a $0.05 increase from the previous year. Rent per square foot typically increases in the fourth quarter of each year for single family homes. For the first quarter of 2017, rent on single This represents a $0.02 increase from 2016Q4 a $0.04 increase from 2017Q1. family homes was $0.78 a square foot. Figure 12

7 Page 7 Table 1: Apartment Rental Vacancy Rates by Zip Code Area ZIP CODE UNIT RATES AVERAGE RATES UNITS Studio 1 Bed 2 Bed/1 Bath 2 Bed/2 Bath 3 Bed F U F U F U F U F U Rent Vacancy Total Units Vacant Units % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % % METRO LV % ". " Number of observations insufficient for statistical purposes. "F" sts for Furnished "U" sts for Unfurnished. Cummulative sum of vacant units might not equal the reported Metro LV vacant units because of rounding issues. Source: CBER Apartment Survey

8 Page 8 About the Institute The Lied Institute for Real Estate Studies was established in 1989 by the Lee Business School at the University of Nevada, Las Vegas to foster excellence in real estatee education research. Through partnerships with business community leaders, the Lied Institute strivess to improve real estate business effective public produces relevant timely real estate research, supports educational programs in real estate economics finance for students professionals, provides community outreach continuing education. policy practices in Southern Nevada. The institute The Lied Institute for Real Estate Studies Lee Businesss School Contact Information Betty Campbell Program Coordinator (702) Betty.campbell@unlv.edu Peter Counts Data Analyst (702) S. Maryl Parkway, Box Las Vegas, NV institute