High Rise Market Mirroring Rest of Real Estate Market in Las Vegas
Every facet of the real estate market was hit during the Great Recession and it has taken years for the market to see some signs of coming back to life. One part of the market that is seeing some hope is the high-rise market. Eight years after the crash, the high-rise market is seeing higher prices and more demand.
Higher High-Rise Prices
The cost per square foot has definitely climbed for high-rises to an amazing $1633 per square foot for one recent sale, which is quite good. This is due to move up buyers and renovations and the demand is very high, due to the opening of the long-awaited T-Mobile Arena, as well as the upcoming NHL expansion franchise and even the hint of a Las Vegas NFL team. All of these opportunities combine to lure people to purchase these high-rise properties.
The high-rise market as a whole has been through much of the same ups and downs with sales and prices as other segments of the real estate market. Shari Sanderson of Award Realty said, “What has been happening in the high-rise market is consistent with other segments of Las Vegas’ real estate market in that it has been steadily rising. This leads to specific high-rise developments having smaller and smaller amounts of inventory for buyers.”
Big Sales Show Positive Signs of Improvement
One big sale that is showing good news for the high rise market is the recent sale of a high rise penthouse at The Residences at Mandarin Oriental. This penthouse sold for $6.5 million or $1633 per square foot. This is a huge price for a high rise. “People should view my recent sale at the Mandarin Oriental as a sign that the high-rise market is continuing to positively grow,” said Kamran Zand of Luxury Estates International. “The sale created a new Las Vegas record for highest price per square foot at $1,633 and the highest resale price in the Mandarin Oriental at $6.5 million.”
While this is not indicative of all high-rises, it is a sign that people are still interested in high-rises as a whole. “… We currently have over a 10-month supply of high-rise condos on the market. It starts to become a seller’s market when that 10-month supply turns into a five-month supply. At the same time, prices are increasing and we’re selling more units,” says Zand.
Buyers Are Moving Up
The high-rise market is overall very stable, even with the ups and downs in prices and sales. There are certain segments that are somewhat more unstable, such as the higher-end. “The lower-end market is where a lot of the investors are, and the interest and prices seem to be stable in this market,” Randy Char of Char Luxury Real Estate said.
“The above-$1 million luxury high-end market is doing very well, and I think the No. 1 reason is that wealthy Southern Californians come here for tax reasons and are choosing this market,” he said. “The other reason is that some people have given the luxury lifestyle a chance by buying a smaller unit to ‘try it out.’ They decide that like the lifestyle, the amenities, the security and they decide to move up to a larger unit or penthouse.”
Renovating is another part of the high rise market and it is not reserved to individual owners. For example, Sky Las Vegas owners are in the progress of renovating 64 unsold units with designer’s touches and are going to begin offering some of the units for sale this summer.