There is no doubt Las Vegas has always had a lot to offer to those in the prime period of their lives. Between 2013 and 2017, Las Vegas’ millennial population grew by 11.6 percent, indicating that millennial residents encompass 28.6 percent of Las Vegans. Over the years, the low cost of living in Vegas has been a large factor for newcomers in making the move to the silver state. However, more and more young hopefuls are finding themselves unable to live comfortably in their desert oasis as home prices continue to soar.
With inflation at the highest level in nearly four decades, Americans across the nation are beginning to experience the onset of a recession. As the town continues to establish itself as a leading spot for millennials, the harsh realities of home ownership in Las Vegas will most certainly be a barrier for young people’s progression in a volatile economy.
Accessible housing is a must for all, and even more important to a generation more likely to be burdened by student loans and stricter lending standards. One survey found that 63 percent of millennials do not have the savings for a down payment and 74 percent of those surveyed feel they are doomed to never own a home. These realities are putting first time home buyers and renters at a huge disadvantage compared to previous generations.
The Zillow Home Value Index shows that the average cost of a Las Vegas home in 2021 was $389,546. This is a 26.9 percent increase from the average in 2020 and a 36.68 percent increase from 2019. Many are blaming the exodus of Nevada’s neighboring state California for the price surge. Zillow research indicates that the average cost of a home in Los Angeles, California in 2021 was $928,320. Although locals are appalled at ordinary Vegas homes pushing a half-million dollars, for those coming from California the high prices appear to be a steal.
When people continue to buy at inflated prices, it drives the cost up even further, making home buying increasingly unattainable for young people on a budget or entry-level salary. While the cost-of-living edges towards the California average, the wages in Vegas are stagnant with an average yearly salary of $36,617. If one applied 30 percent of the average salary towards a mortgage at the current 3.73 percent interest rate, it would take a new home buyer 37 years to pay off the average Las Vegas home of $389,546.
If those figures are too daunting for a young up and comer, renting is always an option, which unfortunately bodes just as badly. The average monthly rent for an 890 sq.ft. apartment in Las Vegas is $1,421. Housing circumstances in the Valley are simply leaving millennials deserted. As rent prices absorb the bulk of one’s earnings, applying monies towards investments, schooling, families, and more become unachievable. Ultimately, Las Vegas’ nightlife, job opportunities, and ease of commute won’t be enough to satisfy young hopefuls.
With limited affordable home-buying and renting opportunities, an entire generation is unable to contribute to the housing market, which can have larger scale repercussions for the economy. These factors will inevitably result in people looking towards other real estate markets as millennials begin “leaving Las Vegas.”