How is COVID-19 Affecting the Las Vegas Land Market? 2020 Land Auction Results
Who knew that the Clark County Aviation Property Auction would be an extraordinary market timer?
The department recently finished a surplus vacant land auction, including 157 acres of property valued at $71.3 million, spread across 16 lots. Of the lots sold, nearly all of them sold at, or well above, their projected market value.
Click here to view the detailed results.
The high bid prices at the auction are representative of one of the longest lasting economic expansion periods experienced after a recession. As we enter a period of economic uncertainty, the real winner here is Clark County Aviation, and not the buyers with the successful bids.
*Update: Since this article was published, transactions resulting from this auction have been extended to a period of time dependent on the current global climate.
Judging the COVID-19 Impact on Las Vegas Land
Prior to this economic downturn, the greater Las Vegas market was experiencing strong demand in all sectors of real estate, and the results of Clark County Aviation’s auction reinforce this. While we navigate uncharted waters amidst the COVID-19 pandemic, there is one key distinction about the crisis as it relates to the real estate market: this disruption- compared to the housing market collapse of 2008- wasn’t created by a market event. This makes its impact on Las Vegas land value and future development more difficult to ascertain.
While the full extent of COVID-19’s impact is still unknown, we predict a rapid recovery, mostly due to pent-up demand in our supply-constrained market. The fundamental market drivers are still intact. As such, we believe that there’s reason to be optimistic about the near future.
The Future of Market Prices Long-Term
We expect to see the overall volume of transactions decline over the next few months as the world continues to grapple with the economic slowdown. However, we do not anticipate a big reduction in new home prices, or development land, in most areas. Land in the Las Vegas Valley is still supply-constrained – which will boost prices for homes and land, even during periods of recession.
We will be closely monitoring the development market over the coming weeks to see how things continue to unfold. We still expect good things from the current land for sale in Las Vegas, and we will keep you updated on our findings.