As the COVID-19 pandemic continues to cause upheaval and uncertainty in Southern Nevada's economy, Vegas Inc takes a look at the local real estate market.
Uri Vaknin, a Downtown Las Vegas condominium developer, is a partner at KRE Capital, which, in a partnership with Dune Real Estate Partners, purchased Juhl and One Las Vegas in 2013. Combined, the buildings have several hundred condo units.
Vaknin spoke with us about the challenges the real estate market has faced, and how it has adjusted. His answers were edited for brevity and clarity.
As you attempt to sell condos during these economically challenging times, how has business changed? During the lockdown, we moved everything to a virtual platform. We set up 3D virtual tours of all of our available inventory and created more video material. We also started doing open houses via Zoom meetings. That’s interesting, because I think it will forever change how people buy real estate.
In the past, people would look at things online, but then they would jump in a car and run around. Now, people are expecting full-on presentations of a property. What’s been great about that is it helps to shorten the time frame of a sale, especially with out-of-town buyers.
You said you’ve noticed an influx of out-of-town buyers to Las Vegas during the pandemic. What’s happening there? We thought that for all the people who had been thinking of moving to Las Vegas, COVID-19 would accelerate that, for all the reasons why people have traditionally moved to Las Vegas and Nevada. Those, of course, are affordability, low taxes in general, no state capital gains tax, less congestion and the ability to just live an upper-middle-class lifestyle. …
About half of our sales after the onset of COVID-19 have been from Californians. We’ve seen a lot of interest from Northern California, which is new. Before COVID-19, probably about 30% of our sales were going to California people.
What’s your take on where the Las Vegas housing market is now and where it could be headed in the next few months? The market was doing great in January and February. In March, people started getting nervous, then we hit the lockdown. What’s happened now, partly because of a lot of California buyers coming in, is we’re rebounding.
The fear for the overall economy here—the elephant in the room—is the possibility of a second lockdown. I think that would have a pretty devastating effect on many levels.
Many businesses have had to adjust their business models or offerings to survive or continue to thrive during the pandemic. Has that been your experience? I hate to use the word “fun,” but it has been fun in a way, because you’ve had to reinvent yourself and become better at what you do. You have to think differently but also be open to the buyer. An interesting thing we’ve seen is that buyers expected to be getting COVID-19 pricing. They thought the economic crisis would have caused a housing crisis.
However, almost nowhere in America has that happened. According to Freddie Mac, purchase demand activity is up about 20% from a year ago. It’s the highest since 2009. With low interest rates, buyers have been put into a home-buying mood.
How is Downtown doing? What people have really liked about Downtown, especially when people were staying at home, was you could go outside and rent a bicycle and ride all over. People are certainly interested in living Downtown, where they can walk around and be around other people—socially distanced now, of course. I think there’s a feeling that there’s going to be a renewed vibrancy Downtown once everything can reopen.