Tuesday, October 09, 2007

Lack of Water Could Drive Las Vegas Home Prices Up

Nevada’s population boom is keeping the Southern Nevada Water Authority scrambling for new sources of water. Every hour, 24 hours a day, seven days a week another two acres of Las Vegas land are developed for residential or commercial use. Developers of Las Vegas new homes are running out of new street names and two phone books are printed every year to keep with up all the new residents and businesses. In 2000 the Census Bureau projected the United States would grow at a rate of 19 percent by 2020. Since 2000 the Las Vegas Valley has added 480,397 new residents - that's the population equivalent of Oakland, California. Nevada's population is expected to grow by 69 percent to 3.6 million people in 2024.

Las Vegas has been one of the country’s fastest growing cities for years. Las Vegas has consistently maintained the highest new job growth in United States. Of the 25 cities likely to have the country’s highest employment growth over the next five years, Las Vegas ranked second in a recent Forbes Magazine study. Since 1990, Las Vegas has also ranked number one in high-tech job growth and more than half of the new companies that recently relocated to Las Vegas were high-tech/manufacturing firms.

But a lingering drought combined with 20 years of booming growth has left Southern Nevada parched. Local officials have subsequently been hard pressed to meet the valley's increasing water needs, which the SNWA now estimates at 400,000 acre feet more annually by 2025. The SNWA, in response, has been pursuing a 300-mile buried pipeline to import up to 150 million gallons of groundwater from northeast White Pine and Lincoln counties. The bond-financed project will cost at least $2 billion to complete.

The SNWA also received approval earlier this year to draw 60,000 acre feet of groundwater from Spring Valley in White Pine County in a staged fashion, with immediate rights to 40,000-acre feet. And the water agency has another hearing in February about drawing 35,000 acre feet of groundwater from Snake Valley, east of Spring Valley.

Meanwhile, the initial 75-mile pipeline section could be operational as soon as 2012.But that's not soon enough. The primary raw water intake at Lake Mead could become inoperable as soon as 2010 based on current drought and user projections, spelling potential disaster for Las Vegas. The SNWA, however, is responding with $817 million for a third raw water intake at Lake Mead about three-miles northeast of Saddle Island. But a lack of water could ultimately impact growth in the valley and drastically reduce the number of Las Vegas homes for sale as existing inventory is eaten up by the expanding population and driving prices much higher.

Post a Comment