Housing Doom

Declining land values in the Las Vegas Valley reflect high vacancy rates in the commercial real estate sectors and a struggling housing market, Applied Analysis principal Brian Gordon said.

The Las Vegas-based business advisory firm reported an average price of $524,725 an acre for 427 acres sold in the third quarter, down 73.9 percent from the same quarter a year ago.

Excluding a 4.9-acre parcel of resort property between McCarran International Airport and Bali Hai Golf Club that sold for $30 million, or $6.1 million an acre, the average price was $459,798 an acre.

Pricing of nonresort property fell for the third straight quarter following a peak of $939,400 an acre in fourth quarter of 2007.

"It’s a function of what’s happening in the local economy and the effects of this global financial crisis," Gordon said. "There’s a significant amount of investor concern in the market. I think there’s certainly potential for further devaluation in the coming quarters."

Fundamentals within the residential, commercial and resort markets have softened, so there’s less end-user demand for raw land, he said.