Home Buying in Las Vegas>Question Details

Sunil, Home Buyer in San Francisco, CA

Is vegas still good for rental property investment? Are the positive cash flow properties?

Asked by Sunil, San Francisco, CA Mon Feb 3, 2014

Help the community by answering this question:


Hello Suni,

There are still investment properties that you can find with positive before tax cash flow. With the big increase in prices this past year, It's just not as easy as it was 2 years ago when we would have 20+ of them for you to choose from that easily had a 8%+ cash on cash return.

Most of the properties in the areas I specialize in that I come across worth running the numbers on that would make great rental properties are coming in a little under a 5% cash on cash return assuming 1 month of vacancy and 8% property management fees. For the nice ones we do come across that are fairly priced, competition to purchase is still very high especially if they are under $150,000. We did just pick one up coming in around a 6% cash on cash return in the mid $160K range that worked for the particular buyer that had some other requirements besides just positive cash flow.

If you wanted to finance / leverage for higher cash on cash returns, I'd have to know how much you are putting down and at what rate your loan was at to run numbers.

For now, it still makes financial sense to invest in Las Vegas homes because Return on Equity numbers are still better then parking cash in the bank, it just requires a little patience for the right opportunities to come up.

Rental prices have not been keeping up for the time being with all of the investment homes that have been purchased in the past few years and turned into rentals. As some have mentioned, the big institutional investors have backed off of purchasing single family homes. As the supply of rental homes available for lease goes down, rental prices will probably increase so those 5% cash on cash returns that can be found today will probably be improved on.

Economic numbers for Vegas are improving - Visitation numbers are up and this year's convention schedule for Las Vegas is projected to be a record year with 70 new conventions added to all of the ones that already come to Vegas every year that contribute over $6 Billion in non gaming revenue to the economy. Vegas made #10 for cities people are moving to so as long as more people are moving in then moving out, future numbers for what's purchased today should only improve.

Let me know if you have any questions.

Paul Francis
Prudential Americana Group
2 votes Thank Flag Link Sat Feb 8, 2014
Enjoyed reading your response . Great Information for everyone.
Helene M Moore
Flag Mon Feb 10, 2014
You can expect 7 to 8% cap, cash on cash. In addition, you should experience appreciation. When the world, and US markets rebound, Vegas will take off again. The key is to provide a quality product to the tenant so you can ask for good quality tenants. There are a good number of rental properties availabel but only a small % of good quality one. There's the key. Prices have stabilized having gone up 23 to 30% last year. The institutional investors have slowed and making it easier for small to medium investors to purchase how. Let me know how we can help you further. We help our investors from start to finish, one stop shop. Thanks, Matt D'Ercole Prominent Realty Group LLC, Investor Services. LasVegasMatt@gmail.com
2 votes Thank Flag Link Mon Feb 3, 2014
The Las Vegas market is still a great market for positive cash flowing properties. Since the end of 2011 prices have been soaring due to low inventory and high demand. The hot seller's market that we were in has now slowed down and the bidding wars have also decreased. Now we see properties selling closing to appraisal value instead of 10% to 15% above in previous years. In early 2012 you could get 12- 14% CAP rates. Since home prices have increased and rental rates have decreased very slightly the CAP rates have decreased. If you are using accurate expenses and vacancy rates you will find on average homes are creating about a 4-5% CAP rate now. You can find higher CAP rates around 6-8% but this is higher than the average. A lot of people use different method of calculating the CAP rate so make sure all expenses are accounted for. If you want to read my latest thoughts on the Las Vegas market please click here: http://www.lvrealestatehelp.com/1/post/2014/02/las-vegas-rea… If you are interested in putting together an investment strategy that will help you meet your investment goals please email me or send me your buying criteria via our buyer's form here: http://www.lvrealestatehelp.com/buying-real-estate.html I look forward to hearing from you!

Best Regards,
Robert Adams
Dual Licensed Real Estate Broker NV#62827 MA#9530304

NV Broker & Team Leader of The Adams Team at Rothwell Gornt Companies
1 vote Thank Flag Link Tue Feb 11, 2014
Hi Sunil

When looking to purchase investment properties, location, monthly return and future gains
are some of the must elements that are essential to any investors.

Las Vegas is on the top 10 cities to invest with positive monthly return. Most properties in the Las Vegas area have increased by around 30% between 2012-2013 with the expected 7% increase in 2014.

For a FREE detail rental and sale market condition by zip codes including time on the market
in Las Vegas, contact me at 702-612-7099 or email me at cvegashomes@gmail.com

Rena Levy
Global broker/Associate
Licensed in two countries
Realty Executives International
Web Reference: http://www.cvegashomes.com
1 vote Thank Flag Link Wed Feb 5, 2014
Yes Las Vegas is still good for rental property investment. Yes you still get some properties where you can have positive cash flow.
1 vote Thank Flag Link Tue Feb 4, 2014
Las Vegas is still good for investment properties. Even though prices have gone up almost 30% during the past year, that was a correction from having dropped so dramatically. Values are now back to about 2002 levels. Personally I would recommend finding small 3 or 4 bedroom single family residences in good school zones. Those traditionally rent well to stable tenants and also appreciate accordingly. We can help you locate suitable properties, provide a rental analysis, and get a good property management team in place to protect your investment.

Diann Tonnesen
Prudential Americana Group Realtors

The Tonnesen Team - with over 30 years of experience helping families call Las Vegas "home!"
1 vote Thank Flag Link Mon Feb 3, 2014
Hello Sunil,
Have you been pre qualified for an investment property mortgage yet? That is the best way to start! Knowing what your monthly expenses will be will help you in answering this very question. We have all types of investor loans to serve a multitude of needs. Call me today, or click the link below and you can fill out your loan application in about 10-15 minutes and I can get you your approval today! I look forward to hearing from you.


Thank you for choosing City First Mortgage Services,

Nathan T. Kessler | Sr. Mortgage Loan Originator

City First Mortgage Services
8871 W Flamingo Rd Suite 202
Las Vegas, NV 89147
(C) 702.683.3126 | (F) 702.974.0848 | (O) 702-522-6743
nathan.kessler@city1st.com http://www.city1stlasvegas.com
Company NMLS # 3117 | Branch NMLS # 819501
Individual NMLS # 377217 NV #46175
0 votes Thank Flag Link Fri Feb 7, 2014
Absolutely! Do keep in mind that multiple rental properties can often lead to a higher positive cash flow, if occupied and well maintained. Due to the high influx of visitors, both short term and long term rental properties are still needed. The combination of low interest rates and a growing supply of properties on the market, it may be of interest to contact a Realtor to assist with your home purchase. Please let me know if I may be of assistance.

Chad Roberts
Realty One Group
0 votes Thank Flag Link Tue Feb 4, 2014
Yes but not as much as in the past 5 years.

What % were you looking to get as you ROI?

Search http://www.Las-Vegas-Real-Estate-Home.com


Phil Scheinman, ABR, GRI, E-PRO
Broker * Sales Agent * Realtor
Realty One
2831 St. Rose ParkwaySte. 100
Las Vegas, NV 89074
Direct: 702-580-9198
Fax: 702-405-7659

0 votes Thank Flag Link Tue Feb 4, 2014

Las Vegas Is still a good buy for Rental Investments..

Feel free to call or email me when you have a moment....
I would be happy to discuss this in more detail and answer any questions that you may have about the Las Vegas Rental Market...

Have A Healthy and Prosperous New Year
Hank Lauzon III
Your Las Vegas Realtor
Signature Real Estate Group
9525 Hillwood Drive #120
Las Vegas, NV 89134

Cell 702-449-0899
Fax 702-543-6844

Web : http://HanksLVRealestate.com
Email: HankLVRealestate@aol.com
Facebook: http://www.Facebook.com/HanksLasVegasRealEstate

Never look down on anybody...unless you're helping them up.
0 votes Thank Flag Link Tue Feb 4, 2014
Las Vegas was #1 in Case-Schiller Index for Price Gain in 2013 at 27.5%. Increased building activity on the strip means more jobs and rents in desirable area are going up. I look for a very strong 2014.

If you want to work with my investment group, I can offer you 40 years of Las Vegas experience.
a total package, buy, fix-up, property manage and sales.

David Cooper 1.888.616.6226
0 votes Thank Flag Link Mon Feb 3, 2014
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