8 Reasons Why Las Vegas Real Estate Will NOT Crash in 2018

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This is a very important video for anyone looking to buy or sell a home here. Southern Nevada real estate has been hot over the last couple years, and people are wondering what the real estate market will do in 2018. In January, I did an end of the year market update video for 2017 on real estate and the local economy (https://www.youtube.com/watch?v=4SPsasvfghc).

In this video I give 8 reasons why I do not think that the local Las Vegas real estate market will have a crash in 2018. Of course predicting what will happen in the economy is anyone's best guess, but I think I have some good evidence as to why real estate in Clark County will hold strong until the end of the year.

1.The “Great Recession” is fresh in the minds of many people, so they are more cautious about buying a home this time.
2.Getting a loan is more challenging this time compared to 2005, 2006, 2007 and 2008 when banks seemed to be giving a loan to anyone.
3. Median home prices are still well below what they were during the peak. In December, 2017 the median home price was about $268,000.
4. Overall number of home sales is up in recent years. If 2018 was going to be a year with real estate going down into a crash then we would have likely already seen signs like fewer home sales in 2017. We may have fewer houses sold this year because the inventory is the lowest it has been in any given month for the last 5 years.
5. We would have already seen signs in 2017 of a crash for 2018. In Las Vegas the highest median home price was in June of 2006 at $315,000 & we did not bottom out until January 2012 when the median price fell to $118,000.
6. The new tax bill states that people can only deduct up to $10,000 of state and local taxes for their federal income tax (https://www.fool.com/taxes/2017/12/29/your-complete-guide-to-the-2018-tax-changes.aspx). This amount used to be unlimited, but now is capped. This has the greatest effect on high income earners in high tax states like California and New York. This change in the tax code could very well push people from large cities in those states like San Francisco, Los Angeles, San Diego, San Jose, Oakland to look to cheaper states to live in with no income tax. Those people will be looking to buy homes in Las Vegas, North Las Vegas and Henderson.
7. The new tax bill also changed the corporate income tax rate to a flat rate of 21% instead of being up to 35% like it was. The global average tax rate for corporations is 25%. Also, there is a one-time repatriation tax of 15.5% to bring their money back here to the U.S. Under the old tax law that amount of money was subject to a 35% tax rate. (https://9to5mac.com/2017/12/21/us-tax-bill-apple/).
8.California has made several changes that impact the amount of people who choose to stay there. Every year people leave California because they are upset with some of the changes made in the state’s laws, and 2018 will be no different. California made history by becoming the first sanctuary state. Because of this California is now in a legal battle with the federal government and its agents over immigration. California also passed a new tax for gas and diesel fueled cars that is expected to bring in $52 billion of revenue over the next 10 years. The state also increased the minimum wage to $11 per hour. The increase in minimum wage will have a stronger impact on small businesses that do not have the same amount of resources and income to handle an increase like a big corporation does. California continues to add to a business owner’s cost year after year, and some of those owners will be looking to head across the state line to Nevada before we hit the year 2019.
Two important numbers to watch out for are the number of homes sold in 2018 and the number of tourists that visit for vacation.
https://www.statista.com/statistics/221042/visitors-to-las-vegas/

8 Reasons Why Las Vegas Real Estate Will NOT Crash in 2018 https://www.youtube.com/watch?v=zOyW0Oy7oc4
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