After the announcement of Tesla’s gigafactory in September, 2014, the Greater Reno-Tahoe area has experienced a major economic boom and the ramifications are far reaching. As the relocation announcements of large and well-known companies are publicized, other businesses, investors and developers from all over the country are moving quickly to position themselves to take advantage of this unprecedented growth. The ease of doing business, coupled with favorable taxes and incentives, is creating an unparalleled environment for both business leaders and developers. With the dual benefits of having no corporate or personal income tax and an unsurpassed quality of life, Reno tops the list for many companies who are looking to relocate. In addition to Tesla, Apple recently chose Reno as the site for their massive iCloud data facility, making the largest land purchase in its history. In addition, the Las Vegas based tech company, Switch, plans to invest $5BB in an 8 million square foot data center. It is projected that the above companies alone will create over 55,000 direct and indirect jobs.
Greater Reno-Tahoe is a diverse region of eight distinct counties located in the northwestern portion of Nevada. A meaningful sense of community binds the region. Included in these counties is the third largest city in Nevada; Reno. Reno has become commonly known as “The Biggest Little City in the World” with its diverse variety of activities, ranging from outdoor recreation to a vibrant nightlife. Located just east of Reno is the growing city of Sparks. With the combination of four vibrant seasons of recreation, arts and culture, this region provides a very attractive place for a wide variety of companies and individuals alike. Housing Market
Since the announcement of Tesla’s Gigafactory landing in Northern Nevada, the local real estate market has experienced nothing short of a new boom. With the expectation of unprecedented job growth from multiple entities which are relocating, the Northern Nevada housing market will be faced with massive shortages over the next several years.
The Economic Development Authority of Western Nevada (EDAWN) has projected that approximately 5,000 new housing units will need to be built each year over the next five years to meet the unprecedented demand for new homes in Nevada.
EDAWN is projecting that by 2020 Reno will have:
52,000 NEW JOBS
INCREASED POPULATION OF 64,500 PEOPLE
45,000 NEW HOMES BUILT – 9,000 PER YEAR FOR THE NEXT FIVE YEARS
As of today, Reno has approximately 2,000 finished lots with only an additional 1,000 in the planning stages. If all 1,000 lots come online, this provides just over one year’s supply of finished lots based on 2016 projected sales and permits and obviously falls far short of what will be needed on a yearly basis for the foreseeable future. Given the significant demand, the following factors seem to be in play:
• Limited supply and growing demand will continue to drive home prices up
• Quality locations will command higher prices as in-fill land is disappearing quickly; and
• New builders and developers will continue to attempt to secure a presence in this market