Between 2018 and 2023, Nevadas housing market became a rollercoaster for middle-income buyers.
But that window quickly narrowed.
By the time rates climbed, affordability had slipped out of reach in many neighborhoods.
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What unfolded was a tug-of-war between opportunity and constraint, played out across the states fast-changing cities and towns.
Who Is Buying Homes in Nevada?
Despite fears that out-of-state buyers were taking over Nevadas market, most home purchasers in 20182023 were local Nevadans.
Even during the pandemic influx, data suggests the majority of buyers were Nevada residents.
However, the mix of buyers did change internally.
The share of first-time buyers dropped to historic lows by 20222023 as prices soared.
Many Nevada buyers were empty-nesters or established professionals rather than 20-somethings starting out.
Notably, single women represented roughly 20% of recent homebuyers, a growing segment despite the financial challenges.
This added competition for regular buyers.
Investor activity soared in 2021 and then dropped sharply by 2023 as the market cooled.
What Homes Are They Buying?
Builders responded by offering smaller single-family designs and more townhome projects.
Condos appealed to many singles and retirees on a budget, offering lower prices and less maintenance.
Zoning and redevelopment have reduced some older mobile home parks.
But by 20222023, buyers started downsizing expectations due to high costs.
In theory, empty-nesters or retirees often downsize to reduce expenses or maintenance.
This was especially true in the pandemic years when vacation-home markets boomed nationwide.
Nationally, vacation home sales surged in 20202021. renting it out part-time or planning to retire there).
This was a key driver of the buying frenzy in 20202021.
However, the situation reversed sharply in 2022.
Statewide, Nevadas affordability index hit an all-time low at the end of 2022 and into 2023.
In Nevada, these owners were reluctant to sell their homes and lose those low-rate loans.
This reduced the supply of homes for sale, as fewer current owners put their houses on the market.
For budget-conscious buyers, that meanteven less inventoryto choose from, compounding the challenges.
From 2018 to 2021, Las Vegas home prices climbed rapidly.
Within the Las Vegas valley, some sub-areas are pricier than others.
Las Vegas proper fell in between at roughly $425,000.
Reno-Sparks Area
Northern Nevadas largest metro had an even more pronounced affordability crunch.
Renos economy attracted tech companies and California transplants in the late 2010s, driving housing demand.
In mid-2022 it surged even higher (some months saw medians around $600,000 or more).
This put Reno among the least affordable markets relative to local incomes.
Home prices in these areas are generally lower than in Las Vegas or Reno.
However, lower incomes in rural Nevada offset the cheaper prices.
Home prices plummeted after 2007, with Nevada among the hardest-hit states.
Investors swooped in to buy foreclosed homes at pennies on the dollar.
In contrast, during 20182023 foreclosures were negligible (under 1% of sales).
By 20152017, prices had recovered somewhat but were still below the 2006 highs.
Fast forward to 20182023: prices not only recovered but blew past the mid-2000s peaks, reaching new records.
The Homeownership Recovery
Nevadas homeownership rate tells the tale.
Around 2006, just before the crash, homeownership was at a high (~62% of households).
The foreclosure wave then pushed many families back into renting.
By 20182019, homeownership was rising again.
During 20182021, Nevadas homeownership rate climbed back up to around 5961%.
In fact, the pandemic home-buying boom bumped it up further (briefly above 60%).
So compared to the post-crash trough, more budget-conscious households in 20182023 were able to become owners again.
Investor Activities in Different Eras
Both periods saw investor activity, but its character differed.
From 20182023, investors were buying into rising prices, not rock-bottom prices.
