In an article in the 9/3 Review Journal author Stephen M Miller states that Las Vegas ranks 168th out of 199 regions in the 2006 housing affordability index. Las Vegas used to be one of the most affordable cities and is now approaching to be one of the worst.
Some of the things that have made housing in Vegas more unaffordable are increases in:
Cost to purchase land
Construction costs
Homebuilders insurance costs
Zoning regulations
Mortgage interest rates
Property tax rate increases
Property insurance
The cost of buildable, vacant land has soared. Land cost at BLM (Bureau of Land Management) auctions rose from $100000/acre in 2001 to over $250,000/acre in 2005.
Mr. Miller believes that the BLM is mainly responsible for the rising cost of housing. By not releasing a larger volume of land at lower costs the government body restricts the availability driving prices higher.
Miller feels that there are three alternative solutions:
"-The BLM can accelerate the sale of land, incresing the available land in the market and lowering its price.
- The BLM land auctions can link affordable housing to the sale through inclusionary zoning. As such, land prices will fall and the BLM take the hit on paying for affordable housing.
- The BLM auctions continue as before, but a share of its revenue subsidizes affordable housing.
The problem becomes how to reduce the cost of land without deflating current land prices.
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