The Las Vegas real estate market keeps coming up Number 1. In a recent report by Trulia, Las Vegas ranked #1 out of the top 10 American cities to buy vs. rent a home. In other words, for many in Las Vegas, buying makes more sense than renting.
More specifically, the “price-to-rent ratio” in Las Vegas in the second quarter of this year was 6 – the lowest in the nation. The ratio is calculated by dividing the median list price by the median annual rent. According to Trulia’s interpretation key, a ratio between 1 and 15 indicates that “owning a home is much less expensive than renting.”
To calculate the ratio, Trulia looked at the total cost of Las Vegas home ownership and the total cost of a Las Vegas rental. The total cost of Las Vegas homeownership includes:
- Mortgage principal and interest
- Property taxes
- Hazard insurance
- Closing costs
- Private mortgage insurance (for borrowers who put less than 20 percent down on the purchase of their home)
- Ongoing HOA dues (which, of course, don’t apply for every homeowner)
- Plus an offset for the tax advantages associated with owning a Las Vegas home, including mortgage interest, property tax and closing cost deductions
The total cost of renting a Las Vegas home includes:
- Renter’s insurance
- With no tax advantage offset
If you’re looking to buy a Las Vegas home, there is a wealth of affordably-priced homes for sale. Even beyond that, there are other reasons Las Vegas is an excellent place to own real estate: great weather, beautiful neighborhoods, year-round golf, award winning restaurants and fabulous entertainment.
But Trulia’s calculations don’t account for the fact that getting a mortgage can be tough nowadays – certainly tougher than it has been in the last decade. Some would-be buyers, whether they’ve had a recent short sale or foreclosure, job loss or bankruptcy, simply may not qualify for a mortgage to buy a home. If that’s the case, renting a Las Vegas home can still be a great option. Click here to search available Las Vegas rental properties.
Whether you’re buying or renting, the Las Vegas real estate experts at Shelter Realty can help. Give us a call today at (702)-376-7379.