Friday, June 12, 2009 | 3 a.m.
Las Vegas’ staggering home prices during the boom years generated cries that the lack of affordable housing hindered the region’s ability to attract teachers and other crucial professionals and prevented companies from moving here.
Despite home prices falling in April to their lowest level since 1998, the need for affordable housing hasn’t waned.
Members of the Las Vegas chapter of the Urban Land Institute met recently to discuss the once-hot topic that you would have thought would have gone by the wayside with median home prices of $125,000 — more than $160,000 below their peak in June 2006.
Robert Fielden, a principal at RAFI Planning Architecture & Urban Design in Henderson, who led the discussion, says many families below the median household income of $55,000 still face obstacles to homeownership.
“They are the ones who have the important jobs, and the workshop focused on those people and the fact that housing is not available to them,” Fielden says.
There are homes that many of them can afford, Fielden says. For example, condo conversions that sold for $150,000 before the housing crash are now going for $40,000 to $50,000, he says.
“I have had Realtors take me out and show me some of these condos for sale, and I wouldn’t put a dog in them much less people,” says Fielden, who calls them a step above a tent city for the homeless.
The condo conversions are way too small for families, too dense and are of substandard construction, Fielden says. They would have to be remodeled, expanded and upgraded to make them practical housing. He says a family can’t have a kitchen that measures 5 feet by 7 feet.
As for single-family homes, Fielden says these families may have the income to pay for them, but coming up with a down payment is difficult.
“The bottom line is we are going to have to start looking for partnerships between the public sector and private sector and find ways of getting people a place to live humanely,” Fielden says.
Although governments have limited money these days, he talked about using tax credits or other public funds or land donations to make projects with affordable housing possible.
Local governments can change zoning by allowing more multifamily housing mixed in areas with single-family homes, Fielden says. Duplexes and fourplexes are needed, for example, he says.
But solving transportation problems can go a long way to ensure people can afford housing, Fielden said. By having a quality public transit system, families who maybe have two vehicles can give up one to save money for quality housing.
John Restrepo, principal of Restrepo Consulting, says that even though affordable housing isn’t the issue it was at the height of the housing boom in 2006, it continues to be a long-term problem because the shortage of land will increase values over time.
“Some people think we won’t have an affordability problem again, but it will creep up over the long term,” Restrepo says.
He says rental housing is one form of affordable housing, and there may not be enough in the future even though investors are buying them and renting them out now.
Once prices rise, some investors will sell the homes and dilute the amount of rental homes in the pool, Restrepo says.
He agrees that families’ ability to come up with a down payment is challenging, and the tightened credit markets make it tougher for people to get loans despite the lower prices.
Questions remain whether satellite communities such as Coyote Springs will solve the problem of affordability, and Restrepo suggests the solution is always higher paid jobs and growing wealth.
“That is the longer-term strategy,” Restrepo says. “How do we diversify our economy?”
In other news:
• Colliers International will hold its first quarterly round-table event July 1 at the Four Seasons. The event will include guest speakers from the Sullivan Group and Colliers. The speakers will start at 8 p.m. Topics include the economy, Colliers’ Las Vegas market overviews and the potential for growth and expansion. Admission is free. To RSVP, contact Gina Jones at [email protected]
• Robyn Yates of Windermere Prestige Properties says the low cost of condos is prompting some people to buy them for their children who attend UNLV. The cost of a condo is one-third less than monthly on-campus housing, Yates says. The cost of room and board at UNLV is about $10,000 for one year or about $900 per month based on 12 months. Purchasing a condo can range from $260 a month for a $25,000 condo to $550 a month for a $75,000 condo, which include principal, insurance, taxes and homeowners association fees, she says. In the Las Vegas Valley 761 condos are listed for less than $75,000 and 28 for less than $25,000, she says.
• The Nevada Realtors Association says its survey in conjunction with the National Association of Realtors says homes in which a Realtor was involved in the sale were nearly 10 percent less likely to experience foreclosure, and homeowners were more likely to know what type of loan they had. The survey of 500 people revealed 60 percent had experienced a foreclosure and 24 percent had a close relationship with someone who had gone through a foreclosure, says David Reiss, president of the Nevada Realtors Association.
• Michael Mixer, senior vice president of Colliers International, has been appointed to the USA board of directors for Colliers International.
• Poker player Perry Friedman paid $1.6 million for a 5,267-square-foot home on Enchanted River Drive. The seller was Ruby Trust.
Brian Wargo covers real estate and development for In Business Las Vegas and its sister publication, the Las Vegas Sun. He can be reached at 259-4011 or at [email protected].