New Home Demand and Building Rebound; Land Prices Lag
- Jun 03, 2012
After a long drought, the Las Vegas housing market finally has some good news for homebuilders. New home permits are up 40 percent across the board, with Las Vegas, North Las Vegas and Henderson among the most active areas, according to VegasInc. Prices are staging a comeback as well; so far this year, average asking prices for new homes are up 6 percent compared to 2011.
Harmony Homes, to name one local builder, is experiencing an 80 percent to 90 percent increase in new orders compared to 2011, VegasInc reported. At that pace, Harmony expects to double last year’s production.
A twist on the trend is illustrated by D.R. Horton’s recent $7.5 million acquisition of Whitney Mesa Estates a parcel in Houston slated for a 275 single-family homes. As that transaction suggests, the cost of land has yet to recalibrate to the resurgent housing market. Rick Hildreth of Land Advisors Organization, who represented D.R. Horton on the transaction, told the Las Vegas Review Journal that land prices in the Las Vegas metro market range between $50,000 and $200,000 per acre for single-family development and $150,000 – $250,000 per acre for multi-family projects.
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