The COVID-19 pandemic has influenced the luxury home market in Las Vegas, but not in the way you might assume. Generally speaking, single-family home sales in the city were down in 2020 by 5.6% as of October. However, by September 2020, the sales of luxury homes for the year had not only exceeded those at the same point the year before but actually rivaled the total for 2019.
It wasn’t this way throughout the whole year, however. From March through May, during the beginning of the pandemic, the entire real estate market in Las Vegas slowed down considerably. In June, however, the luxury home market began to pick back up. This was remarkable because summer is usually the slow housing season in Las Vegas. For the remainder of the year, the luxury home market was strong and remains so now. There are a number of factors that are driving luxury house sales in Las Vegas. Some are directly related to the pandemic, and some are based more on other circumstances.
1. Early Retirement
For many people who were nearing retirement anyway, the pandemic accelerated their plans. Once they were spending most of their time and home, they began to realize that their existing home no longer met their needs.
2. Work From Home
Once the pandemic forced people to work from home, companies and employees alike discovered that this was a viable option for more people than were previously taking advantage of it. The ability to work from home gave people the option of living wherever they wanted to live without having to take the daily commute into consideration. They could even relocate to a different state if they so desired.
3. Need for More Space
While some retirees discovered a need to downsize, others found that, when everyone was sheltering in place together, the space they had was inadequate for everyone. Some needed more flexible space that could be converted into a home office for telecommuting purposes. They decided that buying a new home was a more cost-effective option than adding more space to an existing home through renovation.
4. Lower Taxes
Nevada is one of a handful of states that does not levy a personal income tax on its residents. By moving to Nevada, people from places such as New York, Florida, or California could save approximately 14% on taxes per year.
5. Relocation From California
For years, people relocating from California to Nevada has been a reliable trend. However, this has increased since the pandemic. In the past, many Californians considered it worth the extra expense to enjoy the lifestyle that they wanted. However, the pandemic has changed much of that lifestyle and thrown into sharper relief other difficulties of living in California, such as political unrest and natural disasters. It remains to be seen whether the number of people relocating from California to Nevada will return to its normal level after the pandemic.
Historically low interest rates make the Las Vegas luxury home market favorable to buyers. Learn more about the resources for buyers that EXP Realty offer.