Less than a year ago, Las Vegas was considered a risky housing market. But things are quickly turning around, and the city is one of the upstarts of the pandemic economy with its real estate gains and record stock market. The value of homes is rising quickly, outpacing the national median while remaining affordable compared to local incomes. The city is becoming a hub for the tech industry and is transforming into a favorable financial back office due to the low costs of land and labor. Plus, it ranks as one of the most affordable places to reside in the country while being one of the nation’s fastest-growing metros and one of the best cities for real estate investment.
But even with those persuasive factors, the decision to buy or rent in Las Vegas is a big one that requires a lot of thought. Aside from the external considerations, this is also influenced by your current circumstance.
Read on to learn more about the advantages of buying a home or renting in Las Vegas to help you decide which route is best for you.
The Benefits of Buying a Property in Las Vegas
For those who are looking to settle down in Las Vegas, at least reside in the area for five years or longer, or those who want an investment property, buying a home is highly recommended because of its long-term benefits.
1. More Cost-Efficient in the Long Run
Low interest rates are a significant factor in making buying more affordable than renting in the long run. Rent rates may increase when tenants renew their lease, especially if they live in a desirable area where property values are increasing.
However, a fixed-rate loan ensures your monthly home payment remains the same. In some parts of Nevada, purchasing a home has the potential to be cheaper than renting after four years. Furthermore, the rate on a 30-year mortgage in Nevada is below the nationwide average of 3.99%.
2. Long-Term Investment
One of the biggest advantages of buying a home is that it helps build the homeowner’s equity and overall net worth. The upfront cost of purchasing a home might be higher than renting, but you reap what you sow. Plus, consistently paying your monthlies can boost your credit score and help increase your chances of securing a loan for other financial goals.
On the other hand, if you rent the same place for several years, your cumulative monthly payments can equal a mortgage, but you won’t actually own any part of the property.
3. Tax Benefits
Nevada has some of the lowest property tax rates in the country, with a state average of 0.53%, compared to the national average of 1.07%. The state has a property tax abatement law that protects homeowners from steep tax hikes as it limits the annual increase by a maximum of 3%. Nevada also has no income tax, making it extra appealing for those who are looking to move to the state. Furthermore, mortgage interest and property tax are legally tax-deductible, which can help offset the cost of homeownership.
While renters don’t pay a mortgage, property tax, and home insurance, these fees are typically factored into the cost of the monthly rent as the landlord still has to pay for them.
4. Greater Freedom and Stability
While these are more intangible and non-financial benefits, the freedom and stability that come with buying can make all the difference between a house and a home. Owning the property means you have the freedom to do whatever you want – from drilling holes into walls to mounting shelves to undertaking major renovation projects. Renters have to live by the rules set by the landlord, which usually include guidelines on what can and cannot be changed in the unit.
Buying a home also gives you a sense of stability, which is vital particularly for new couples and young families who are looking to plant their roots. Being assured of living in the same place allows homeowners to integrate into the community. Plus, Las Vegas has some of the largest homes in the country, with the median house being 1,835 square feet.
When Renting in Las Vegas Might Suit You
For those who frequently relocate to different states or are only planning to stay in Las Vegas for a short while, renting might be the more practical choice.
1. Lower Housing Costs in the Short Term
Renting is usually the way to go for people who aren’t planning to stay in the state for a long time. The monthly housing cost will typically only entail rent and utilities, so you can gauge how much you need to allocate in your budget per month. The cost of rent may be cheaper than a mortgage, so you can choose to fund other financial goals.
The landlord is usually in charge of maintenance and repairs, so you don’t have to worry about paying for those. That’s a big relief, particularly for those who live busy lifestyles and have difficulty finding time to schedule repairs. If you’re renting a condo or apartment complex in a desirable area, you may have access to additional amenities like gyms, pools, and parks.
3. Flexibility To Relocate
If you want to move to a different place after your contract or lease is up, there’s nothing stopping you. This affords you the flexibility to relocate according to your needs. You may find a home that’s closer to your place of work, has access to better amenities, or offers a cheaper rent than where you’re currently staying.
Renting is also a good option for those who have just moved into the city but want to explore different areas before settling down and making a long-term investment.
Ultimately, whether you buy or rent in Las Vegas depends on your current situation and future goals.
If you’re ready to buy a home in Las Vegas, don’t do it alone. Work with local experts and contact The Brendan King Group today.