Southern Nevada landlords are dialing back the huge rent increases they gave tenants last year amid a broader slowdown in Las Vegas’ housing market.
The typical rent in the Las Vegas-area last month was just over $1,890, up about 8 percent from a year earlier, compared with a 25 percent year-over-year rent hike in August of 2021, according to figures from listing site Zillow.
Susy Vasquez, interim executive director of the Nevada State Apartment Association, said the number of people moving here from out of state is down. She also indicated that units are sitting available longer, and that landlords appear to be offering more concessions to prospective tenants.
Compared with last year, she said, the rental market is a “totally different picture.”
For apartments in Southern Nevada, rents are up 3.1 percent this year, down from a 22.5 percent price jump last year, according to data Vasquez pulled from real estate tracker CoStar.
Price growth is slowing amid increased availability as Las Vegas’ apartment-vacancy rate is now 7.3 percent, up from 5.4 percent last year.
The sharp slowdown in rent hikes should offer relief to tenants following the huge price increases seen last year. Las Vegas’ fast-rising rents sparked concern over tenants’ ability to keep up with monthly payments, amplifying the issue of Nevada’s affordable-housing shortage.
Vicki Gilmore, a 72-year-old retiree in North Las Vegas, is worried she will become homeless if she can’t find an affordable place to live.
The rent for her apartment is set to increase to $1,010 at the start of November. When she moved to North Las Vegas three years ago, her rent was $550 per month, she said.
Gilmore said she must now live without luxuries like cable and internet. Most of her monthly income goes toward rent, utilities and cleaning supplies. Groceries are covered with help from food stamps and food banks, she said.
“They only seem to care about senior citizens when it’s time to get our vote in November,” she said of politicians. “No one seems to care that I may become homeless in November.”
Nationally, rent hikes “appear to be leveling off” after a “rapid run-up” in prices that peaked in February, according to Zillow Senior Economist Orphe Divounguy.
But demand remains “very high,” as the lack of affordable homes to buy is pushing many tenants to renew their lease or look for another place to rent, Divounguy said Tuesday.
Locally and nationally, home sales have been tumbling for months amid a sharp jump in mortgage rates this year. Sales prices have also been sliding recently in Las Vegas, and the tally of available houses on the market has skyrocketed.
Overall, the market looks much different than it did last year, when it accelerated to its most frenzied pace in years.
Rock-bottom mortgage rates fueled a buying binge, and demand for rentals climbed higher as people worked from home amid the pandemic and waves of newcomers moved to Southern Nevada from pricier metro areas.
Strong demand, tight supply and rapid price increases for buyers and renters alike made it more difficult and more expensive to land a place to live in the Las Vegas Valley. Long viewed as a more affordable outpost, Southern Nevada was even deemed one of the worst markets in the nation for first-time homebuyers in a report this June from personal-finance site Bankrate.
Gov. Steve Sisolak this year launched a $500 million initiative to boost affordable housing in Nevada. The program called for $300 million for multifamily development, $130 million for multifamily rehabilitation and preservation, $40 million for land acquisition and $30 million to help homeowners.
The initiative marked the “largest single investment in affordable housing” in state history, the governor’s office previously said.
Nevada, with the bulk of its population in the Las Vegas Valley, has an estimated shortage of 79,835 affordable and available rental homes for extremely low-income tenants, according to the National Low Income Housing Coalition.
Audra Hamernik, president and CEO of affordable housing developer Nevada HAND, said this summer that the group was receiving 2,000 calls a day from people seeking an affordable place to live.
She also noted the developer only had a “handful” of vacancies every week in its portfolio.