Ethan Miller/Getty Images for MGM Resorts International
Before the 2017–18 NHL season began, the newly formed Las Vegas Golden Knights were expected to do what every expansion team does. Lose. A lot. But the Knights have checked common wisdom into the boards and captivated the sports world with their run to the Stanley Cup Final.
Before the season, the Knights were 500-1 underdogs to win the Cup. Now they are contending for the sport’s top prize. (Game 4 of the series is Monday night, with the Knights trailing the Washington Capitals 2-1.) Away from the rink, the city of Las Vegas has faced and overcome long odds before. It defies skeptics daily just through its very existence in an inhospitable desert climate in the middle of what would otherwise be best described as nowhere.
But lately, Vegas isn’t just surviving—it’s thriving. The city, hit hard by the Great Recession, has rebounded, emerging as one of the hottest real estate markets in the country.
“We bought into the Vegas hype early last year and predicted the city as the No. 1 market poised for sales and price growth in 2018," says Director of Economic Research Javier Vivas of realtor.com®. “Those predictions have been materializing as we head into the final days of spring."
Knights mania spills over as the Cup comes into view
So does Vegas’ status as a hot housing market have anything to do with its hockey team making an amazing run at the Cup? Not everyone is convinced
"Because success can come and go in sports, we don’t find much of an effect of a winning sports team on a local housing market," says Chief Economist Danielle Hale of realtor.com, "unless you count more team flags flying around town."
But others see more of a long-term impact on the Vegas housing market.
"There’s an impression in the real estate industry that hot professional sports teams like the Golden Knights can only be beneficial," according to broker Brian Kyle of First Serve Realty. Having a top franchise in one of the four major sports leagues catapults Vegas into a different stratosphere, allowing it to claim the moniker of "big-league city."
Granted, cities such as Green Bay, WI, and Sacramento can also boast big-league affiliations, but those cities don’t have Criss Angel performing nightly at the Luxor.
And the frenzied local fandom does have a few direct tie-ins to real estate, according to Las Vegas luxury broker Zar Zanganeh. "The owner of the Knights is also the owner of five huge escrow companies. Every time you go to any of their offices on a game day, the receptionist, the escrow officer, the attorney, every single person is wearing team gear." Go, Knights!
Kyle tells a story about one of his wife’s friends teaching their pet parrot to say, "Go, Knights, Go!"
"You can’t walk down the street or even the grocery store these days and not see dozens of people wearing their Golden Knights regalia," says Kyle. "It’s giving this city a new, national image."
Negative image skates away
During the Great Recession, Las Vegas was one of the hardest-hit areas in the country. Foreclosures, short sales, and abandoned housing tracts were like loose slots—visible everywhere in the city.
After the recession, Vegas lagged other metros in recovery. According to the National Association of Realtors®, home prices plunged 61% from the first quarter of 2006 to the first quarter of 2012.
Las Vegas exists in an inhospitable desert climate in the middle of what many would describe as nowhere.
Hale says the past half-decade has been critical to the city’s recovery. "In the last six years, home prices have climbed back 223%, but they are still about 14% below the 2006 peak."
This mirrors what Zanganeh is seeing on the ground in Sin City. He says buyers are actually hungry for foreclosures right now, but the distressed inventory has evaporated.
"There’s a huge appetite from investors and flippers who crave that low-priced inventory. Unfortunately for them, they aren’t finding it."
So who’s betting on the Las Vegas housing market?
Zanganeh says his firm just listed a $300,000 home—and the response was overwhelming. "We’ve had five different offers on the property, and not a single one below the asking price."
He adds that employment is up and four major casino properties are under construction. Folks working on those projects need a place to live, and Zanganeh says buyers—even those who don’t work in construction—are flocking from California to avoid state tax.
The housing market in Las Vegas, hit hard by the Great Recession, has exploded in the past six years.
Kyle shares the same sentiments about the scorching market right now in the desert. He says homes in nice shape priced under $300,000 are getting multiple offers the day they land on the market.
“We are back to pre-recession excitement level," he says, "although the foundation of this real estate market is completely different from where we were back then."
Housing prices are rising as Vegas skates in formation with the rest of the country, according to Stephen Miller, an economics professor and director of the Center for Business and Economic Research at the University of Nevada, in Las Vegas.
The city was in desperate need of positive signs as it emerged from a yearslong downturn, and the Golden Knights are simply providing "the cherry on the top," says Miller.
Clare Trapasso contributed to this report.