Get ready to hit the jackpot in Las Vegas: the best bet in America’s casino city is on the property market, says Dave Ward, who rolls the dice for UK investors

Think of Las Vegas and you are likely to conjure up images of noisy casinos, relentless desert sun and tacky wedding chapels with flashing neon signs. Few would associate it with some of the best restaurants in the United States, world-class luxury resorts, excellent theatre or being surrounded by breathtaking natural wilderness.

In fact, all the above have made Las Vegas the fastest-growing city in the United States. It also has the hottest property market, with house prices rising 47 per cent in the fourth quarter of last year.

Demand for new high-rise luxury flats - or ‘condominiums’ as they are known in America - has resulted in most investors buying off-plan and large developments selling out within weeks.

The growth in low cost direct flights from London and Manchester, plus a weak dollar exchange rate, have made owning a property in Las Vegas an attractive option for British investors.

However, purchasing in Las Vegas has as much risk as reward. Spending extra time researching the market and looking at the long-term investment return on your capital can help prevent common buyer mistakes.

The Las Vegas property market is different from other US resorts. For a start, any property over five years old is considered ‘old’. Residents move on average every three years and would rather move than redecorate.

Estate agent Jason Tomei, who specialises in buy-to-let properties, says: "When you think of Las Vegas you think of limitless desert, but there is a shortage of land - 89 per cent is owned by American Indians, the State or federal governments."

The scarcity of development land has accounted for the surge in highrise condos being built. These solid concrete developments are expensive to construct, so expect to pay from $400,000 to $500,000 for an average unit. More than 60,000 high-rise condominiums and condotels are planned for future construction.

If one of these doesn’t appeal, consider the ‘single family home’ - the American equivalent of a detached bungalow. These are highly sought after amongst buyers from the UK, Spain, Japan and Canada. Costing an average of just under $300,000, they are less risky as an investment due to the lower price and because they are popular rental homes for the 100,000 Americans who relocate to Las Vegas every year.

A mid-rise condo or ‘town home’ can cost around $200 per sq ft compared to $600 per sq ft for a luxury condominium, so you get more space for your money. But be wary of buying a mid-rise property as many are poorly constructed with flimsy woodchip communal walls that provide little sound insulation.

Investors are often attracted to units like the C2 Lofts (pictured below) in the Summerlin area which come with quality fittings like stainless steel appliances and granite countertops and have roof terraces with heated spas, outdoor fireplaces and barbecues. These are ideal for investors who want a low maintenance, high spec property.

In the past three years investors have accumulated their biggest gains from capital appreciation, not rental income. Even the most optimistic estate agents are wary of the sustainability of recent 25 per cent year on year increases in property values.

Estate agent Michelle Sterling says: "Many people have been caught up in a buying frenzy, paying well over the asking price for their investment properties. I advise investors to view a variety of property before committing."

Some investors are renting out property for less income than the costs of servicing their mortgage and property maintenance, on the basis of expecting solid appreciation in property value.

There is also intensive competition when renting out, not just from other rental homes but from the quality of the hotel accommodation.

Even the most basic rooms in many Las Vegas hotels are suites with kitchens, living areas and separate bedrooms. Hotels are competitively priced, which reduces the rental income that can be charged on short-term serviced apartments.

Prospective rental income is unlikely to be the most attractive factor for UK investors when buying a property in Las Vegas. But beware of over-expectations on capital growth.

If you decide to buy a luxury serviced apartment, then expect high management fees for renting it out.

Jason Tomei recently bought a luxury apartment in the yet to be completed Trump Tower.

"I paid $780,000 for what is essentially a 690 sq ft hotel room. Trump can rent it out for me on short-term lets but they will charge a commission of 50 per cent to cover maid service, concierge and resort amenities," says Tomei.

It is important to have full, transparent details of the proposed service charges of any development before agreeing to a purchase.

Some new developments have the most opulent luxuries for their residents. This is great if you plan to live in the property to get full use of them. However, it is an expensive burden to be paying hundreds of dollars per month for luxuries like valet parking for a vacant rental property. On average, expect to pay $6,000 per year in service charges for condo properties of 1,000 sq ft.

Property taxes in Las Vegas are low compared with other major cities in the US, at one per cent of the assessed valuation of a property - not the price you paid for it.

A safe bet is to budget around $1,500 per year for taxes on an average single family home costing $300,000.

Given the weak dollar to sterling and low interest rates, buy-to-let investors can get a lot for their money at the moment. It is easy to open a US bank account and some brokers are experienced in lending to overseas buyers.

Broker Matthew Maltese, of Republic Mortgage, says: "The most common loan for overseas investors is around one third deposit on the property value, and the rest depends on their specific requirements.

"To purchase a home without a US Social Security number, you need at least 30 per cent cash up front."

Low season air fares from the UK start at under £400 including taxes, and this has undoubtedly helped to open up Las Vegas as a location for British investors.

With around 300 days of glorious sunshine every year and plenty of things to do, it is easy to see why Las Vegas is fast growing as a residential resort due to the high quality of life for relatively low cost. So here are some tips:

It is always advisable to do extensive research of property listings on the internet.

Think about your purchase requirements and your lifestyle before you even start to look at property in the United States.

If you intend to use your American property for yourself for part of the year but do not like scorching summer heat, then Las Vegas is not your ideal destination.

Remember to plan your budget and financing, and factor in costs for repairs, service charges and voids.

Finally, don’t feel pressurised to rush into anything: be prepared to walk away or go back for another visit later.