The luxury home market remains strong

The luxury new home market, driven by demand for ultra-high-end properties, continues to surge in Las Vegas and shows no signs of slowing down in 2022 despite rising prices and mortgage rates that could be felt by consumers. whole sector.

The latest numbers from Home Builders Research show builders in Southern Nevada closed 101 homes priced at $1 million and above in the first quarter. This exceeds 91 in 2021 and 57 in the first three months of 2020 when the COVID-19 pandemic impacted the industry.

This 11% increase in luxury closings during the first quarter outpaces the overall new home market which fell 2% in closings from January to March 2021, according to Home Builders Research.

In the $750,000+ category, builders saw 281 closings, a 45% increase from 194 closings in 2021. There were 140 in the first three months of 2020.

Some of these percentage jumps can be attributed to rising prices due to the cost of materials, labor and land, according to Andrew Smith, president of Home Builders Research. The median price for single-family homes closed in March was $483,000, a year-over-year increase of 17.8%.

“First, it’s a price-raising factor in general,” Smith said. “But as we’ve seen on the resale side, the high end is doing really well, I think white-collar workers who come from out of state with more income can afford something Upscale in Las Vegas What’s upscale in Las Vegas isn’t necessarily in California, and that’s part of it, too.

In the ultra-luxury segment, Dan Coletti, president of Sun West Custom Homes, said he completed a one-story home during the first quarter at Ascaya in Henderson worth about $15 million. The home on Heavens Edge Court sits on 2.5 acres, measures 9,600 square feet, and features five bedrooms, eight bathrooms with a six-car garage and a poolside cabana.

“It was the third house we built for the same client,” Coletti said. “It’s the second in Ascaya as the first was in Seven Hills. It’s cool to have a loyal customer. He likes that it’s higher up the hillside in the mountains of Ascaya, a nice view at the end of a cul-de-sac and a bigger property.It’s an updated version of his last one that we sold for $14.6 million last June.

Real Estate Millions has profiled the home and owner Stan Gribble.

The house of wow and water

Coletti said he listed the house on Heavens Edge Court for $15 million, but Gribble decided to hold it for now and sell it later. He has already purchased another, even higher piece of land in Ascaya, and when that is almost complete, he will sell the Heavens Edge house, he said. Construction will begin in the summer.

“It’s another one-story house because we put two lots together, and it’s going to be about 15,000 square feet,” Coletti said. “It will be closer to $20 million.”

Coletti said the luxury market continues to grow with people moving in from California and other states. The state’s economic climate for building businesses and the fiscal climate have contributed to this, he added.

“These beautiful hospitality sites in Ascaya and other similar communities provide beautiful views of our valley, and people eat from them,” Coletti said. “I have three under construction at MacDonald Highlands right now (including a three-story one and a 24,000 square foot casita with two nine-vehicle garages on separate levels that will be valued at over $25 million). I’m also working on some of them at the Summit Club. We’re getting more than our fair share of superhome buyers compared to other cities. That $15 million+ high-end luxury market is stronger. than what I have seen for many years.

Coletti said that for luxury buyers, flexible spaces are growing in importance. If they have additional guests, they want a game room converted into a bedroom.

“Some also ask for bigger garages that can fit more cars and more cool stuff,” Coletti said. “They demand the best luxury we can offer. It is state-of-the-art technology, which is home automation with automatic sliding doors and controlled air conditioning systems for energy efficiency.

“It’s not all about the finishes. It’s really about the basics – the windows, the doors and all the visual elements. They want beautiful stone and great cabinetry and granite and marble materials. It’s not so much about size as it is about overall quality and features.

Bespoke luxury builder Blue Heron holds the all-time record for a $25 million sale at MacDonald Highlands in 2021, and CEO and founder Tyler Jones said the segment remains “extremely strong”.

The builder already has a dozen reservations for a project called Shoreline at Lake Las Vegas that starts at around $1 million, Jones said. It offers waterfront land and golf courses.

In recent months, the company has launched three more communities, including one in Lake Las Vegas called Strata and another near Pecos and Sunset roads in Henderson that will cost between $2 million and $3 million.

“There’s a lot of interest in our communities going for $3, $4 and $5 million,” Jones said. “On the elite side, this $3-25 million was our biggest year for these sales yet. California residents continue to be the primary source of buyers.

Jones said they are seeing interest rates rise, but that hasn’t impacted sales. California taxes have an even greater impact, he said.

“If you look at California and the impact it has on someone’s wallet and add a few points to their mortgage in the luxury segment, that tax relief in California has a much bigger influence than the increase escalation in mortgage rates,” Jones said. “It hasn’t been a big factor for us, and I don’t expect it to be unless things change drastically.”

Among production builders, Luke O’Loughlin, sales manager at Richmond American Homes, said demand was strong but the company didn’t have many luxury homes available for sale until April. He opened Veneto in the Northwest Valley, which sells for the upper $800,000 and $900,000, and Richmond sold six homes in three weeks from 20 available lots.

A second project called Estrella Park near Ann Road and Hualapai Way in the North West Valley has so far seen eight sales from 40 lots. These one-story ranch homes sit on half-acre lots and will cost over $1 million and range in size from 3,300 square feet to 4,000 square feet.

“We’re always looking to add to this product line,” O’Loughlin said. “There is little inventory in general and in addition with luxury it is even less. It’s a captured audience that doesn’t have a lot of options right now.

“We have something in the South West called Galway Grove (with 21 half-acre lots) that has been pushed back a few months, and we still have people calling about the product line. We already have a waiting list for this. We are delighted to be in the luxury market again and excited for future projects.

At Tri Pointe Homes, division president Klif Andrews said the luxury segment remains “very hot” and is expected to remain so.

“Even with the interest rate concerns and some potential slowdown in other parts of the market, the luxury part isn’t slowing down,” Andrews said. “They have a lot of cash buyers. It is also supported by foreign buyers who have a different view of our prices than us because they have equity. To them, $1.5 million seems inexpensive even if you have higher mortgage rates.

Tri Pointe has three projects in Summerlin that fall into the luxury category, Andrews said. These are Sandalwood, Overlook and Kings Canyon – all of which average over $1 million.

“They want a big lot and a gated community and location is everything and premium lots are really important,” Andrews said.

Sandalwood, which opened in 2020 with average prices over $1.5 million, still has one lot in 112.

Overlook and Kings Canyon opened in late 2021, and each time a phase is released it sells out quickly, Andrews said. Overlook costs an average of $1.4 million and Kings Canyon around $1 million.

“We still have a year to go to Overlook and Kings Canyon, but it’s been selling out at a steady pace,” Andrews said. “We are starting to close our first homes right now.”

Andrews said Tri Pointe has a “substantial luxury project” coming up for Lake Las Vegas that will be along the waterfront with 43 real estate lots. It will be available in early 2023.

“Other parts of the market are hard to tell, but luxury doesn’t feel like it’s running out of gas at all,” Andrews said. “There are a lot of affluent shoppers who are willing to spend money on things they love.”