Housing and Utilities in Las Vegas

When it comes to housing Las Vegas prices had a tremendous run up from the late 1990s onwards when the city was a booming low unemployment Mecca, but since those heady days the economy has been ravaged and the prices of real estate have plummeted. The good news is that they have returned to affordable levels. But let’s put values to one side since they are so variable and consider the different areas that one can choose to live in and the available Las Vegas utilities.

North Las Vegas is a working class area with an unwarranted reputation for high crime levels. Some of the newer developments are very attractive and well worth a look. In the southeastern side of Las Vegas is the master-planned community of Green Valley which is beautifully landscapes and extremely well thought out. Other planned communities are: Spring Valley, Summerlin, Peccole Ranch and Desert Shores.

Home owners associations are more common in Las Vegas than some other parts of the nation and you want to be careful that you understand that whilst the Covenants, Conditions and Restrictions keep things looking nice and uniform they also limit your freedoms – a lot of folks from the Mid-West find that they are more comfortable living outside of gated communities in order to avoid these restrictions. You can have liens placed against your property if you do not comply with the HOA.

An alternative to buying is of course renting, but traditionally this tends to be fairly expensive in Las Vegas relative to mortgage repayments. However, following the real estate crash occupancy for rental apartments has dropped to 90%, the available supply is as much as 20,000 units and rent rates have dropped below $1 per square foot. The highest are in the southwest and Green Valley-Henderson area, and the cheapest rents are in the northeast and southeast. When you rent you are usually required to commit to a period of six months or a year, and put down a security deposit in addition the first and last month’s rent. It is not uncommon for newcomers to rent prior to employment and you just need to show a bank statement that assures the landlord that you will be able to meet the rental obligations.

Once you move in you will want to get your Las Vegas utilities set up:

Water is provided by Las Vegas Valley Water District located at 1001 S. Valley View Blvd. Las Vegas, Nev. 89153. To start or transfer residential water service, call the office Monday through Thursday from 7 a.m. to 6 p.m. at (702) 870-4194. You can also request service before 3:30 p.m. for same-day service for a $15 fee. You may be required to pay a $150 deposit to activate your water service.

NV Energy is the company to contact for connecting your electricity and they can be reached at (775) 834-4444. You do not require a deposit to activate this service, but if you are renting you will require a letter of reference from your previous electric company.

Southwest Gas Corporation has a very easy online set up service https://ssm.swgas.com/start.php, or you can call Toll Free (877) 860-6020, or vist the customer service office located in the Beltway Business Park, next to Starbucks and Port of Subs: Las Vegas, 6040 Badura Ave, Suite 110, Las Vegas, NV 89118. There is also a customer service office at North Las Vegas, 1374 W. Cheyenne # 107, North Las Vegas, NV 89030.

There are four Nevada assistance programs run by Southwest Gas that you can look into: Deferred Payment Program, Energy Assistance Program (EAP), Energy Share Program, and Nevada Energy Connection. These are designed to help low-income Nevadans with the cost of home energy.

There are also a number of energy efficiency programs that you can take advantage of to lower your bills. Call Southwest Gas for details on: Northern Nevada Low-Income Energy Conservation Program, Energy Start Home Program, Nevada Residential Energy-Efficient Consumer Products Rebate Program, Northern Nevada Furnace Rebate Program, and the Solar Thermal Advantage Rebate (STAR) Program.

Clark County Sanitation handles sewage and can be reached at: 5857 E Flamingo Rd Las Vegas, NV 89122-5507. The phone number is (702) 458-1180.

Trash removal is managed by Republic Services of Southern Nevada. They pick up around twice a week at a cost of less than $50 per quarter. They are located at 770 East Sahara Avenue, Las Vegas, NV 89104 on phone: 702 735 5151. There is also a recycle center at  333 West Gowan Road, North Las Vegas, NV 89032 that can be reached on 702 399 1112.

For telephone Sprint Central Telephone Company is one option, but these days many people are opting for a bundled internet and phone connection from Cox Communications. Sprint is at 330 South Valley View Blvd. Las Vegas, NV  89107 on 702-244-7400, and Cox will happy to sell you TV, internet and phone 24 hours a day at (702) 383-4000.

Las Vegas History: A Growth Story Like No Other

The history of Las Vegas is one of growth. The city has been growing since Rafael Rivera became the first non native to enter the valley back in 1829. Following the incorporation of Clark County back in 1905 its population has grown more than 30% every decade, with some decades increasing by nearly 200%. From growth driven by the mining industry, through to the goldmine that is the casino industry, Las Vegas has had a number of factors make it the fastest growing part of America in the last 100 years.

The Paiute and Anasazi Indians were the first on the scene in Las Vegas, followed by the Spanish explorers of 1829, who named it “the meadows” for its water-rich marshland. The next major visitor was John C. Fremont in 1843, who produced and distributed a map of the area. It was the Mormons that came in 1855 who first tried to really settle in the valley, but the Paiutes ran them off. Despite this the area began to grow as it was used as a resting point in the journey from Utah to California. This led to the next big figure in Nevadan history to enter center stage: William Clark, who built a railroad and land a townsite. The railroad was the backbone to significant growth in the following decades, until the real driver of modern Las Vegas came about in 1931 with the legalization of gambling.

The story of modern Las Vegas is really that of the Strip, which was initially simply known as Route 91. Thomas Hull opened El Rancho Vegas in April 1941, and this was the first step in drawing the crowds away from the Downtown casinos. Next came R.E. Griffith who built the Last Frontier on 175 acres in October 1942. This was the first themed hotel that Vegas had seen.

The first famous episode in the Strips’s history started when the founder of the Hollywood Reporter, Billy Wilkerson, acquired 33 acres south of the Last Frontier and started construction of the Flamingo in April 1945. Wilkerson was a compulsive gambler, and when he misallocated development funds his mob partners Gus Greenbaum and Moe Sedway secured $1m from crime boss Meyer Lansky to continue the project. Benjamin “Bugsy” Siegel was asked to oversee the investment, and he eventually took it over. Unfortunately he rushed the opening in December 1946 and it had to close one month later because it did not have enough rooms available to generate the funds to maintain operations. The Flamingo reopened in 1947 with 93 rooms available, and it was an instant success, however, the cost overruns were not forgotten and Bugsy was shot to death in his Hollywood bungalow.

In the history of Las Vegas it is easy to forget the credit due to the true pioneers: Thomas Hull and R.E. Griffith. In the story of the Flamingo it is easy to forget the importance of Billy Wilkerson’s initial vision, and the operational skills of Greenbaum and Sedway. For many people it will always be Bugsy who built the Strip.

The Flamingo changed Las Vegas by opening it up to more sophisticated customers than those that visited Downtown, and once the concept was proven the hotel was quickly followed by the western-themed Thunderbird in 1948, and the Palm Springs-inspired Desert Inn in 1950. Next came the Sahara, the Sands, the Royal Nevada, the Dunes and the Riviera – all in place by 1955. But it wasn’t over and the Hacienda opened in 1956, the Tropicana in 1957, and the Stardust in 1958.  The Stardust was the first hotel to realize the potential of the mass market, and its 1,000 rooms were soon filled with average folks who enjoyed gambling.

It was Jay Sarno who bridged the gap from this building boom to the destination resort that we know today. Sarno was a visionary who opened Caesar’s Palace in 1966, and followed it up with Circus Circus. He paved the way for those that followed, and it was Steve Wynn and Kirk Kerkorian who took up the reigns.

The Mirage Hotel opened on 22nd November 1989, and the Strip has never been the same since. Whilst Las Vegas Boulevard had seen mega-resorts before, such as Kirk Kerkorian’s International and MGM, a young Steve Wynn raised the stakes with his Mirage and started a trend that transformed 1990s Las Vegas. The building boom that followed delivered: Excalibur (1990), Rio (1990), Luxor (1993), MGM Grand (1993), Treasure Island (1993), Hard Rock (1995), Monte Carlo (1996), Stratosphere (1996), New York, New York (1997), Bellagio (1998), Mandalay Bay (1999), Paris (1999), Venetian (1999), and new Aladdin (2000).

Meridian Condos Las Vegas

The Meridian Condos/Meridian Private Residences located at 250 E. Flamingo (Flamingo & Koval Lane NE corner) are extremely popular for three main reasons:

  1. They are just one block east of the Strip
  2. They deliver resort-style landscaping, atmosphere and facilities
  3. They are cheaper that luxury high-rise condos

This popularity of the Meridian Condos Las Vegas is despite of the development’s legal woes, and in fact it is these legal issues that are contributing factors in keeping prices depressed. Meridian started out life as an apartment complex, was converted to condos, and then converted into a hotel. This hotel operation was declared illegal by Clark County and the development reverted to a condo.

Location

The Meridian Private Residences has 16 acres of private gated grounds, that have a Mediterranean-style atmosphere. Its courtyards, fountains and pools are genuinely sophisticated and this is no kitsch Caesar’s Palace. On site there is a Resident Service Center which has DVD rental, cleaning, mail services, and food. There is also a concierge service, conference rooms, movie theatre room, clubhouse and a business center. All residents benefit from gated underground parking, and there is outside parking for guests.

Layout

There are five floor plans available.

  • Athens, Studio, 530 Sq Ft
  • Barcelona, One Bedroom, 692 Sq Ft
  • Calais, One Bedroom, 757 Sq Ft
  • Florence, One Bedroom, 760 Sq Ft
  • Genoa, Two Bedroom, 1,005 Sq Ft

Background to the Meridian’s Legal Issues
Owners have filed a number of complaints with the Nevada Real Estate Commission about the development, including that the Meridian violated state laws on how homeowner associations are to run. However, the property’s dramas started when it was found to have been operating as an illegal hotel.

American Invsco, a Chicago-based company, converted the Meridian from apartments to condos in 2005. It then went on to sell individual units to individuals and operate it as a hotel. Clark County shut down the unauthorized hotel operation in July 2008 and it was subsequently fined $568,000 for back taxes.

Meridian employee Rebekah DeSmet was taken to court and faced two misdemeanor charges for zoning and licensing infractions. The Meridian owners contested that Clark County knew that it had been operating as a hotel, and that this was evidenced by in November 2007 when a “renewal” of a business license to operate transient lodging at the Meridian was issued. However, the county stated that this was an error in its records and that a renewal could not be issued since no active license was issued in the first place.

The hotel shutdown saw the end of the rental income that some owners claim they had been promised at the time of purchase. With most owners counting on the rental income to make mortgage payments many units went into foreclosure. The owners made a number of complaints, from the fact that they had been unwittingly underinsured and not covered for the liabilities that a hotel is exposed to, right up to mortgage fraud. The plaintiffs asked the court to rescind their purchase contracts, and award punitive and other damages.

The legal fight has two sides. Plaintiff attorney Michael Mushkin stated, “If (defendants) had dealt straight up, and it was a bad investment — then, buyer beware. But orchestrated fraud is simply wrong.” Whereas attorney Ken Morgan (defending Koval Flamingo LLC, a company that was formed to purchase the Meridian to convert it from apartments to condos) stated, “The allegations of the complaint are largely false. And the conclusions that the plaintiffs’ counsel would have anyone draw from an inaccurate set of statements are largely invalid.”

The fraud allegation stems from the fact that some plaintiffs claim that the seller, Koval Flamingo LLC, led them to secure residential mortgages suitable for a primary residence, rather that a higher rate investment property loan. This is used to substantiate the plaintiff’s claims that an investment opportunity was disguised as a residential community.

Meridian Private Residences Summary

Kitchens:

  • Granite counters
  • Pantry
  • Breakfast bar
  • Microwave
  • Dishwasher
  • Refrigerator

Room features:

  • Great views from some rooms
  • There are vaulted ceilings in some units
  • Mirrored closet doors
  • Tiled floors
  • Extra storage available
  • Cable
  • Private balcony or a private patio
  • Walk-in closets
  • Roommate split floor plan in some units
  • Some paid utilities
  • Ceilings reaching nine feet
  • Washing facilities

Community Features:

  • Gated community
  • Mature Mediterranean landscaping
  • Elevator
  • Business center
  • Conference center
  • Concierge
  • Maintenance available on call

Recreational Facilities:

  • Swimming pool
  • Spa
  • Modern Fitness Center
  • Clubhouse
  • Racquetball court
  • Tennis court

Jim’s Rocking On

On Wednesday 21st of April 2010 developer Jim Rhodes was granted permission to apply for higher-density housing that is permitted by zoning for his proposed development on the former James Hardy Gypsum mine. The Clark County Commissioners voted 4-3 in favor of allowing Rhodes Red Rock company to apply for major projects that are at least 700 acres in size.

The original plan filed in 2003 was to build 5,500 houses on 2,400 acres. It was in this same year that the state introduced restrictions on the land that Rhode’s had bought, and he went on to sue the state and the county for making the changes. In 2009 a federal judge struck down the restrictions made by the county. The Clark County Commissioners feared that if they did not allow Rhodes to apply for housing then he may win a court battle and then be free to build or sell the land in smaller parcels.

At the heart of Rhode’s argument is that the state specifically singled out is land in their 2003 changes and thus violated equal protection rights. Wednesday’s ruling was a step forward for Jim Rhodes, but it won’t be seen as a positive move by most of the residents of Blue Diamond.

Foreclosure Outlook

The exact level of Las Vegas foreclosures coming onto the market is unknown, but there are indications from analysts that they may depress pricing levels further:

  • Trulia.com in December 2009: “the market is still on the decline…A lot of cuts are at the top of the market. It would not surprise me to see double-digit declines, unfortunately, in Las Vegas over the next 12 to 18 months. Until unemployment levels off and starts to get better, we expect foreclosures to continue to play a big role in the 2010 housing market.”
  • SalesTraq in December 2009: “Hundreds if not thousands of Las Vegas homeowners haven’t made a mortgage payment in more than a year and still haven’t received a foreclosure notice…that’s how backed up it is. The banks are overwhelmed…If two out of three homeowners in Las Vegas are upside down, it’s a matter of time. If the economy doesn’t improve, a lot of people are going to take a walk and they’re not showing up on the radar right now.”

1 in every 102 housing units received a foreclosure filing in February 2010, and 1 in 89 in Clark County, most of which are in Las Vegas.

February 2010 Foreclosure Map

Source: Realty Trac

In addition to the uncertainty surrounding the shadow inventory, 76% of Las Vegans are currently upside down on their mortgages. If the economy does not improve, or worsens, there could be a further wave of foreclosures. On a more positive note, the recent dip in the number of foreclosures that are coming to market indicates that there may be price appreciation once the shadow inventory is worked through. The time horizon and rate of such capital growth is far from certain.

Las Vegas Foreclosure Activity

Source: Realty Trac

Las Vegas Trustee Sales

In February 2010 3,800 homes were auctioned via trustee sales in Clark County, but only 550 of these were bought by third parties. This is a continuation of the 2009 trend, when 3,000 sales took place at the trustee sales auctions during the last five months of the year – just a fraction of those up for auction. The majority of properties are priced uncompetitively at the price of the outstanding debt, and revert to the banks as Real Estate Owned, or have the auction canceled or postponed as a result of negotiations between the lender and homeowner.  Many of the properties that are acquired via Las Vegas trustee sales are quickly released onto the traditional real estate market by the investors that purchased them.

Industial Assessed Values Down

The 2010-2011 tax rolls have been published by the Clark County assessor’s office, and they show that Las Vegas industrial space has been the poorest performing category in commercial real estate.

The assessed values for all property in Clark County fell 26 percent from $90.8 billion in 2009-2010 to $67.1 billion, and within this the assessed value of industrial land fell 20.5 percent from $3.1 billion to $2.5 billion. This is a sharper decline that in the commercial sector as a whole (down 15 percent), but it is still less of a decline that that of residential property, which dropped 26 percent from $48.4 billion to $35.7 billion.

Industrial assessed values fell 22.2 percent in Las Vegas, 22.2 percent in North Las Vegas, and 19 percent in Henderson. It is typical for changes in commercial real estate pricing to trail those in the residential sector, whether they will see the same steep declines of Las Vegas residential remains to be seen.

$12.5bn of Appraised Value Wiped Out

The Clark County assessor’s office published a list of the 25 largest taxpayers in Clark County, and it showed that in 2010 these properties have lost $12.5 billion in appraised value. Las Vegas real estate taxes are down. The total appraised value of $41.2 billion includes land and buildings, and is a 23% decline on the $53.7 billion value of last April. These declines in commercial real estate follow the collapse in residential values.

Despite the decline in appraised values local governments are not going to see a decline in values. This is because the taxes on commercial properties were capped at an annual 8% rise back in 2005. Values haven’t dropped so far that the post-2005 taxable base has been eroded. As a result of this legislation newer owners are paying a disproportionately higher amount of tax than those that had large portfolios pre-2005.

  1. MGM Mirage
  2. Harrah’s Entertainment
  3. NV Energy
  4. Las Vegas Sands Corp.
  5. Boyd Gaming
  6. Wynn Resorts
  7. General Growth Properties
  8. Station Casinos
  9. Universal Health Care
  10. Basic Management
  11. World Market Center
  12. McCarran Center
  13. Camden Property Trust
  14. Olympia Group
  15. Greenspun Companies
  16. Treasure Island Ltd.
  17. Harsch Investment Properties
  18. Marnell Corrao Associates
  19. Nevada Property
  20. Hospital Corporation of America
  21. Gaughan South Limited
  22. Olen Properties
  23. Wal-Mart
  24. Goldman Sachs Group
  25. Crescent Real Estate Equities

The MGM Mirage figures are skewed by a couple of factors: the sale of Treasure Island, and City Center coming online. Putting these two factors together MGM’s appraised value of $16.3 billion is a 4 percent increase on 2009’s $15.7 billion. The assessed value, on which taxes are applied, is $5.5 billion. Harrah’s Entertainment also has a significant change – it acquired Planet Hollywood – but despite this its appraised value of $5 billion was still below its $7.3 billion of a year ago.

Some companies have dropped off the Top 25 Las Vegas Real Estate Taxes list altogether. Turnberry Associates were ranked No.10 in 2009, but having lost Fontainebleau Las Vegas have seen its appraised value fall to $257 million. Other disappearing acts include Focus Property Group, Trump International and Triple Five Development.

http://www.lvre.com/summerlin-homes-for-sale/

Las Vegas Real Estate

Geography and Demographics of the Las Vegas Real Estate Market
The Las Vegas real estate market consists of land and properties in the Las Vegas metropolitan area in the Southern part of the state of Nevada. The Las Vegas metropolitan area is also known as the Las Vegas-Paradise-Henderson Metropolitan Statistical Area.

Metropolitan Statistical Areas are central urbanized areas consisting of a relatively high population density. They can be made up of multiple counties, but in the case of the Las Vegas metropolitan area consists of just Clark County, which is the 15th largest county in the U.S. and is made up of five cities: Las Vegas, Henderson, Boulder City, Mesquite, and North Las Vegas.

A central part of the metropolitan area is the Las Vegas Valley, a 600 square mile basin, which includes the metropolitan area’s largest city, Las Vegas. Las Vegas is the most populous city in the U.S. state of Nevada, and the 28th most populous city in the United States with an estimated population of 558,383 as of 2008.

The estimated population of the Las Vegas metropolitan area as of 2008, was 1,865,746. Back at the time of the 2000 census the racial makeup of the MSA was 71.58 White, 9.08% Black, 5.74% Asian, 0.79% American Indian and 12.81% of other or mixed race, and the median income for a household in the MSA was $44,616 and the median income for a family was $50,485. The per capita income was $21,785.

Economy of the Las Vegas Real Estate Market

Las Vegas is the entertainment capital of the world, and is home to fourteen of the U.S.’s fifteen largest hotels. The Las Vegas economy is driven by leisure and tourism, with the key employment sectors for the last decade having been construction, especially residential construction, and leisure and hospitality. The Las Vegas recovery will be driven by improvements in the national economy fueling tourism, and by the imbalances in the local housing market correcting. Economic recovery in Southern Nevada will probably lag behind the rest of the country as employment and wages will have to rebound nationally before visitor volume and gaming revenue can rebound locally.

Other sectors that male a contribution to the economy are conventions, shopping, and restaurants, and like casinos these are mainly fueled by tourists. The pro-business tax climate has seen the commercial sector steadily growing, and in addition to this government, the military and schools are significant employers.

The Las Vegas-Paradise MSA lost 58,600 jobs between May 2008 and May 2009, sending the unemployment rate to 11.1 percent. The largest loss of jobs occurred in construction (-17.3 percent), information (-10.9 percent) and professional & businesses services (-9.3 percent). Gaming revenues and visitor volume are down compared to April 2008, and only the deep discounts offered by local hotels have improved room occupancy. Multiple gaming companies are in default on their debt or declaring bankruptcy. Condo projects have seen their prices fall approximately 30 percent from their peak. Home foreclosures remain high throughout the Valley, and apartment occupancy is at its lowest level in 10 years.

All real estate sectors have grown with the economy: casinos have driven demand for off-strip warehouses; a growing business community has seen more offices being built; and retail has grown as a tourist attraction as well as to meet the needs of a rapidly growing population. The residential real estate sector has been hard hit by the recent economic downturn, and consists of a wide range of stock from single family homes, through to luxury condos.

Las Vegas Casino Industry – the commercial real estate driver

In the first six months of 2009 Nevada’s gaming revenues were down 13.5%, and 14.7% on the strip. In June the state’s gaming revenue sunk to 2004 levels: casinos collected $818.2 million from customers in June, which is a 13.8% decline from June 2008, and is the 18th straight monthly decline. On the Strip gaming revenue fell 14.8% in June to $414.5m.

A lot of Las Vegas’s appeal is based on the discretionary income that had increased through stock heavy 401Ks, home value increases, and easy lending practices. This lead to a building boom and focus on higher end casinos.

Las Vegas is more highly correlated with the national economy than it was previously because of its reliance on this discretionary income which has been eroded by the current recession. The wealth effect that drove Vegas’s boom is unlikely to come back quickly, particularly in the middle-market segment of customer.

The way that Las Vegas has traditionally worked is to have each building cycle create it in demand. But the idea of “build it and they will come” is clearly not something that will work in the current environment, and there is a significant supply of housing coming online.

Basically the industry built some very grand casinos based on average room rates in excess of $250 per night and with easy access to financing. With room rates below half that target the debt is becoming harder to service, and it may be the case that the cost structures are unsustainable, and that the next few years will witness collapses and changes of ownership. It may the case that the bull cycle owners go bust, and it is the next owners that make the money.

The Las Vegas Office Real Estate Market
There is 32 million square feet of offices over 10,000 square feet in Las Vegas, excluding those which are owner-occupied, or medical office buildings. Whilst one million square feet of office space was built in 2008, this was just 37% of 2007 levels. Vacancies in offices stood at 17% by the end of 2008.

The Las Vegas Retail Real Estate Market
There is 61 million square feet of off-the-Strip non-owner occupied retail buildings larger than 20,000 square feet. Vacancy in retail space stood at 9.9% at the end of 2008, which is double the rate at the end of 2007. With rising unemployment, and a fall in the discretionary spending of consumers the retail sector has been hard hit.

Las Vegas Residential Real Estate Market
In July foreclosure filings were up 32% on the same time a year earlier, and Nevada had the nation’s highest foreclosure rate for the 31st straight month. Deutsche Bank estimates that the MSA of Las Vegas-Paradise has 81% of homeowners who own homes valued at less than is owed on them, and it predicts that this will increase to 90% by the first quarter of 2009. These price pressures are likely to drive an increase in foreclosures. In the multi-family home sector vacancy rates increased from the average of 7.68% in 2007 to 8.76% in 2008. In the Class A sector the vacancy rate for apartments was 7.80%, Class B was 9.26% and Class C was 9.04%.

The Las Vegas Industrial Real Estate Market
Of the 102 million square feet of industrial real estate in Las Vegas, approximately 35 million is warehouse distribution, of which 40% is Grade A quality. Typical warehouses are around 100 to 250,000 square fee, but there are also larger distribution centers, and industrial parks of multiple buildings. North Las Vegas and the South West are the dominant sub-markets. In addition to servicing the Las Vegas MSA population of two million, and its massive hotel industry, the warehouses are used as regional distribution hubs for the 11 south-west states that can be reached overnight.