Insights into Las Vegas Townhome & Condo Market Trends (2021-2025)

[Mike Holt]

The Las Vegas townhome and condo market has been on an eventful journey from 2021 through 2025. Following a pandemic-driven boom in 2021-2022, characterized by soaring prices, rapid sales, and a sharp drop in inventory, the market began to cool in 2023 due to rising mortgage rates and economic uncertainty. However, the outlook for 2025 remains optimistic, with expected price appreciation, continued demand, and strong job and population growth in the Las Vegas area.

Market Trends 2021-2025

From November 2021 to May 2022, median prices for townhomes and condos in Las Vegas increased by 18.8%, from $240,000 to over $285,000, reaching a peak of $287,000 in August 2023. The sales pace was impressive, with 91.1% of properties selling within 30 days in April 2022, while inventory dropped to just 0.7 months' supply. As the market cooled in 2023, price growth slowed to 8.3%, and sales volume decreased by 15% from the 2021 highs. In 2024, the market began to balance, with a 8.7% price increase to $282,500 in March and 62.5% of sales closing within 30 days. Projections for 2025 suggest a more moderate 5-7% price increase, still above national averages but with less intense competition than during the peak years of 2021-2023.

Investment Opportunities

The Las Vegas townhome and condo market offers various investment opportunities. Fix-and-flips can be profitable due to affordable entry prices and the potential for forced appreciation through renovations. However, this approach carries higher risk in a cooling market. Buy-and-hold rentals provide a more stable option, with projected annual appreciation of 5-7% and a strong rental market driven by population and job growth. The BRRRR strategy is also well-suited, allowing investors to acquire, renovate, rent, and refinance properties, capitalizing on the area's affordable prices, high rental demand, and potential for forced appreciation.

Fix-and-Flip vs. Buy-and-Hold

Fix-and-flip investments in Las Vegas have the potential for significant gains through renovations, with recent annual price increases of 8-18%. However, this strategy carries higher risks as the market cools and economic uncertainties could dampen buyer demand. On the other hand, buy-and-hold rentals offer a more stable path, with a thriving rental market supported by population growth, job gains, and the affordability of townhomes and condos. This strategy involves ongoing landlord responsibilities and potential vacancy risks during economic downturns.

Rental Market Dynamics

As of 2024, the Las Vegas townhome and condo market continues to experience strong rental demand, despite some inventory relief. Rents have surged nearly 40% from 2019-2022 and, while stabilizing, remain significantly above pre-pandemic levels. Robust job and population growth, along with limited new inventory, is expected to sustain strong rental demand and further rent increases through 2025, though at a more moderate pace than during the recent frenzy.

Top Townhome Neighborhoods

Promising sub-markets for townhome and condo investments in Las Vegas include Summerlin, Henderson, and Downtown Las Vegas. Summerlin offers high-end amenities and strong appreciation potential, attracting affluent buyers and renters. Henderson features a mix of affordable and luxury options, steady growth, and proximity to major employment centers. Downtown Las Vegas presents opportunities to capitalize on ongoing revitalization, with many value-add properties, rising rents, and potential for significant returns.

Townhome Rent Growth Trends

The Las Vegas townhome and condo sector has seen substantial rent growth in recent years, with a near 40% increase from 2019 to 2022. Although rent growth has moderated, rates remain significantly higher than pre-pandemic levels. The market is currently experiencing a period of adjustment, with a slight increase in apartment vacancy rates to 7.3% in Q4 2023. Despite this, continued population and job growth, along with limited new development beyond 2025, suggests potential for renewed rent growth in the medium term.

The market's long-term outlook remains positive, with Las Vegas's continued growth driving demand for townhomes and condos, making it a viable investment area for both short-term gains and long-term stability.