August 30, 2008
As a realtor it is my duty to be the ambassador of good news and serve as chamber of commerce of happy times. For the past twenty years as a realtor I have always taken a line from Mark Twain -: "Buy land they aren't making any more". This is always followed by my observation that in the long run land always goes up. The United States bought all the land west of the Mississippi for 1 penny per acre and so far it has never sold for less than that.
Lately the adage from buyers waiting to buy real estate is to wait a little longer and see if prices go down any more.
In Vegas we have experienced a drop of around 50% over the high prices seen last year. Turns out this may be the correction predicted by everyone but me. I'll be honest I saw the market booming by the end of "08" or mid "09". Prices in Vegas are now reflective of prices in 2004 which was the beginning of the craziness in the market.
So how long do you wait?? By the number of foreclosures we see being processed in Las Vegas at this time there seems to be an additional 10-20% decline possible. While that may be disparaging to some, my thought is that if you buy a property that cash flows now, and rents are moving up at a rate of 8-10% per month and purchasing now means you begin earning money now and are actually able to purchase the homes you want, what is stopping buyers from buying now.
Maybe you're waiting for the market to drop. How much lower can it go? Well in Detroit last week they found out just how low it can go.
A home actually sold for $1 dollar. Is this the end of the end? I don't think so. But I have had several close friends tell me lately they are going to go to Detroit and buy houses because they could get them for $5,000 dollars. Imagine paying $5,000 and then realizing you over paid.
I think the lesson here is that you need to buy in a market that makes sense. Yes Vegas is hard hit, when you're on top you have the longest distance to fall.
But Vegas has the most future development currently under way and is poised for the earliest recovery in the US.
As I write this today, there is so much talk of the GO zone in Mississippi, Alabama, and Louisiana and right now hurricane Gustov is threatening the Gulf Coast with another hurricane, seems GO zone now means go away from there.
If you looking for good deals Vegas has them all. Prices dropping, rents increasing, future jobs being created. MGM announced today that the final billions of dollars needed to complete City Center have been acquired.
Even with the announcement of projects delayed Vegas make's sense.
We seem to have focused in on the foreclosure process and are now acquiring good deals for our buyer clients. If you're interested in good deals in real estate please call me.
I can't believe I'm saying this but we have deals so good that a quick carpet clean and paint could put you in a position to flip the property.
There has never been a truer adage that in bad times the rich get richer and the poor get-well you know.
Rick Byrd
