First Investment : Long Distance : Vegas...Thoughts? Experiences?

[Brandon Phillips]

My market here in Seattle is very expensive, searching for first deal locally as well as abroad. Vegas seems appealing, cheap houses, rent part of house monthly, airbnb near strip. Does anyone have any insight about investing here? Experiences/Stories/insight anything would be helpful.

[Casey Powers]

Hi from Las Vegas. 

Airbnb / STR is illegal in most of Las Vegas, many HOAs don't allow it (and they will report you to the city when, not if, they catch you), and in the few neighborhoods where you can do it, permits are required.

In addition, I believe the city just passed a ban on Airbnb/ST rentals and only currently permitted properties will be grandfathered. 

Rents haven’t caught up to purchase prices with the recent run-ups, but there are areas where price/rent ratios are better. Research the areas and the specific communities. 

I personally don’t recommend most small multis here, as they’re typically old buildings, often with lots of deferred maintenance. I do manage some, and it often takes a fair bit of repair to bring them up to a point where something isn’t breaking constantly. Also, plumbing is a frequent issue in these older multis. 

I believe the real value in Las Vegas will be in an appreciating market over time. The influx of Californians has already started and is likely to continue as baby boomers retire and seek lower cost of living + more bang for their property buying buck. Also we see younger people coming in constantly seeking opportunity + refuge from high cost of living. I believe the number was 30% of our buyers are from out of state. 

Companies like Amazon and Allegiant Airlines expanding. 

We may see a market drop before long, but markets always go in cycles and Las Vegas land is almost completely developed. We are surrounded by federal land. Scarcity drives prices up. 

Finally, Nevada is landlord friendly. I have not had a bad tenant stay longer than a month yet, even when they drag me to court. One took me to court twice, in December, and I still had her out on the 30th. I’ve done quite a few evictions as I get hired by owners to clean up their problems. If you know the system here and don’t mess around, bad tenants get out quickly. 

Lastly, there is plenty of demand for rentals. If it’s priced right, property will rent quickly, in any neighborhood in town. The #1 reason rentals sit vacant here is they’re overpriced. Not oversupply or lack of demand.