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Aug. 11, 2007
Copyright © Las Vegas Review-Journal

Index sees growth in population slowing

By HUBBLE SMITH
REVIEW-JOURNAL
Housing
Housing in Las Vegas
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Click image for enlargement.
Graphic by Mike Johnson.

Population growth is slowing in Las Vegas as the cost of living here has risen substantially in the past few years, a UNLV economist said.

About 6,000 new residents are moving to Las Vegas every month, compared with 7,000 to 8,000 a month in 2005 and 2006.

Keith Schwer, director of the Center for Business and Economic Research at University of Nevada, Las Vegas, attributes the slowdown in population growth to a natural swing in business activity and to the escalation in housing costs.

"Compared to Wichita (Kan.) and Omaha (Neb.), it's not as enticing as it once was," Schwer said Thursday. "Keep in mind the economy is good in the rest of the nation except for Michigan."

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    • The Southern Nevada Index of Leading Economic Indicators pushed upward in July to 133.24, compared with 133.06 in June and 132.53 in July 2006. Eight of the 10 series of data contributed positively to the index, led by taxable sales at 0.16 percent and commercial building permit valuation at 0.09 percent.

    The index, compiled by the center, is a six-month forecast from the month of the data, May, based on a net-weighted average of each series after adjustment for seasonal variation.

    The accompanying Review-Journal chart includes several of the index's categories, along with data such as new residents and employment and housing numbers, updated for the most recent month for which figures are available.

    The positive movement in the index overcomes a sharp decline in the residential market as measured by units permitted and permit valuation, Schwer said. Residential permits dropped 52.8 percent in May to 1,789 and residential permit valuation fell 50.7 percent to $217.5 million.

    On the commercial side, building permits increased 6.2 percent to 120 and commercial permit valuation soared 322 percent to $379.5 million.

    Construction and travel and tourism are large components of business activity in Las Vegas, Schwer said. Construction activity dropped primarily in residential, but nonresidential construction remains strong, he said.

    A separate Clark County Construction Index from the center turned upward in January and continued to climb to 169.59 in May, up from 167.58 in April.

    Construction employment, having peaked in June 2006 at 111,600 jobs, has declined to 109,500 jobs.

    The downturn in the housing market and the resulting loss of 5,200 construction jobs statewide in the past year has dominated the economic picture, Nevada Department of Employment, Training and Rehabilitation economist Jim Shabi said.

    Nevada's economy has led the nation in annual job growth a dozen times over the past two decades and has usually been described in glowing terms, he said.

    The state's employment growth and unemployment rate could now best be described as "average," Shabi said. Employment has increased 1.7 percent over the past 12 months, the lowest growth rate since September 2002 and barely above the 1.5 percent increase for the nation as a whole.

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    EMRON wrote on August 12, 2007 04:16 PM: Nobody can afford these overpriced stucco boxes. The funding is gone, no more liar loans, prices have to come down! nobody will qualify for these houses without the liar loans, the funding has officially just dried up. I'm not surprised some people are still trying to buy because us as Americans are STUPID! I know there are a lot of people in Vegas who have no idea what is going on in the financial markets they're to busy working and watching mindless television. Folks the free money has officially ended, mortgage companies are going BROKE! HOUSE PRICES WILL COME DOWN.


    Vegas Bob wrote on August 12, 2007 02:48 PM: Now Listen up you speculator schmucks, the blodbath is now just beginning to accelerate...the screams you hear on wall street and now being heard on main street with the housing meltdown just one sign that we are heading into the most painful 24 to 36 months this town has seen in recent memory. Those home values you thought you had are going to be alot less and if you think your going to get what your asking think again!


    Dave wrote on August 11, 2007 03:07 PM: Housing permits are down 52% from the PEAK permit period of last year and over the last 2 years. Therefore, are housing permits probably are back to, or close to the average permits issued of the last 10 years? Or so one would think. Year over year (especially unusual conditions) does not a good comparison make. A little more depth to the reporting would be appreciated.


    David Huntington wrote on August 11, 2007 12:18 PM: No, it doesn't include illegals as they won't apply for licenses that ask too many questions. They drive without insurance too, leaving the honest and responsible citizens holding the bag if invloved in an accident with an undocumented illegal alien.


    say what wrote on August 11, 2007 12:07 PM: does that 6,000 a month include the illegals too?


    Bryan wrote on August 11, 2007 11:41 AM: Randy, you need to do some research on how data is collected for population growth. You sound like youre one of those doom and gloomers. The 6000 people moving in is based on new drivers license counts collected from DMV. A small amount of people who have moved here recently still havent changed their out of state licences. Also take in affect the number of births that happen in Clark county. Yes, there are people who move out of Vegas, but the people moving in overmatches it. I've been living here for about 2 years now and still have my out of state drivers license since I still own property outside of Nevada. The housing market is shaky right now, but builders are finally realizing that theyve overbuilt and are stepping down on residential construction as what was stated in the article. Itll probably take one or two more years till things finally work it out but understand real estate has always gone thru cycles, and as long as you have expensive next door counties such as Orange, San Diego, and LA counties, Las Vegas will continue to grow and people will always need a roof over their head whether theyre renting or buying.


    RANDY wrote on August 11, 2007 10:22 AM: About 6,000 new residents are moving to Las Vegas every month,BUT THEIR ARE A LOT OF PEOPLE MOVING OUT. A GUEST-IMATION WOULD BE ABOUT 2500. THIS IS UNDER REPORTED. IF YOU TAKE THIS INTO ACCOUNT, THEN THE HOUSING MARKET WILL STAY WEAK. IT IS NOT GOOD NEWS FOR THOSE TRYING TO FLIP PROPERTIES. ALSO, THIS WILL EFFECT THOSE WHO ARE TRYING TO SELL AND LEAVE LAS VEGAS. THE WAGES HAVE YET TO CATCH UP WITH THE TRUE COST OF LIVING.THERE IS INFLATION IN THE HOUSING MARKET. THE COST OF GAS HAS TAKEN MORE OF PEOPLES DESPOSAL INCOME.IF THE POLITICAL THINKING BECOMES REALITY, THEN TAXES ARE GOING TO INCREASE ON US ALL. MORE INFLATION BECAUSE BUSINESSES WILL PASS IT ON TO IT'S CUSTOMERS.THE NEXT 18 MONTHS WILL BE ONE ROLLER COASTER RIDE IN THE FINANCIAL MARKETS. I THINK THE MARKETS HAVE GOTTEN WAY AHEAD OF ITSELF. INVESTERS WILL HAVE TO LOOK FOR BARGAINS AND DUE THEIR HOMEWORK.