In the latest rental survey, after surpassing the peak rents of 2007 in the first quarter of 2017, the Las Vegas market continues to grow rental rates. In the third quarter of 2017, the Las Vegas apartment market saw another 1.85% increase in average rental rates, bringing the year-to-date increase to 7.24%. The Green Valley/Henderson submarket continues to lead the Las Vegas Valley in rent levels, as it has since 2013. Meanwhile, the Southwest and Northwest submarkets exceeded the $1,000 average rental rate level for the first time in history. Overall, the Las Vegas Valley is now 6.55% above the peak rents of 2007.
Each submarket saw an increase in rents over the previous quarter, with the Northwest (3.72%), the Southwest (2.82%), and the Northeast (1.59%) experiencing the highest growth.
Year-over-year, the Las Vegas apartment market averaged a 6.43% increase in rental rates. The Northeast, North Las Vegas, and Southwest submarkets showed the highest year-over-year growth rates. Concurrent with the results of the Q2 Rental Rate Survey, the submarkets in northern Las Vegas continue to illustrate a story of recovery. After the recession, the southern submarkets recovered much faster than the northern submarkets. It is now apparent, in recent quarters, that the northern submarkets are making substantial rent increases, signifying a delayed, yet eventual recovery.
Each class of apartments experienced growth both year-over-year, and quarter-to-quarter. Year-over-year, Class B apartments demonstrated the highest increase in rental rates (9.66%), followed by Class C (7.82%), and then Class A apartments (5.08%). When viewing quarter-over-quarter increases, Class C properties showed the highest percentage increase (3.28%), followed by Class A (1.75%), and then Class B apartments (0.56%).
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By Spence Ballif, Jannie Mong, and Adam Schmitt | CBRE | Friday, October 20, 2017
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