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The Las Vegas RE Bubble appears to have burst
Prudent Bear "Bear Chat" ^ | 1/1/2005 | "Viperbear"

Posted on 01/01/2005 9:24:43 PM PST by steve86

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I hope Viperbear doesn't mind my cross-posting this. Several of us have been following the LV RE bubble for some time. Let Greenie try to deny this bubble. You can't print money like a drunken sailor, push credit card debt creation like a holy sacrament, permit corrupt enterprises like Fannie Mae, and not pay the piper in the end.
1 posted on 01/01/2005 9:24:44 PM PST by steve86
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To: nanak; RockinRight; Prime Choice; ETERNAL WARMING; BurbankKarl; durasell; Dead Dog; expat_panama; ..

Easy money, hard fall Ping!


2 posted on 01/01/2005 9:28:37 PM PST by steve86
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To: BearWash
Couldn't happen at a better time.. There's more than a few Californian's trying to jump out of the California market, and a cheap LV market would make them quite happy.
3 posted on 01/01/2005 9:29:02 PM PST by kingu (Which would you bet on? Iraq and Afghanistan? Or Haiti and Kosovo?)
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To: kingu
While I wouldn't mind seeing the bubble burst, I have to say after residing in Las Vegas (formerly) and still having family there, the market has softened as it has everywhere like for instance the Pacific NW, I would wager that after Feb the markets will heat back up.
4 posted on 01/01/2005 9:42:22 PM PST by ThisLittleLightofMine
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To: BearWash

Maybe this will bring speculators back to the stock market where they belong.


5 posted on 01/01/2005 9:44:08 PM PST by Moonman62 (Federal Creed: If it moves tax it. If it keeps moving regulate it. If it stops moving subsidize it.)
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To: ThisLittleLightofMine
I'm not sure that the fire in the belly will heat back up in the spring. Remember that mortgage rates really haven't climbed and liquidity hasn't dried up. This downturn is the result of oversupply and momentum buying running out of momo juice (similar to the stock market right now). When easy money gets harder, that's when the real correction will occur. And as some people pointed out in the PB thread, when MM starts reporting negative appreciation is when the speculation will die, and when down payment requirements go (back) up is when many will be priced out of the market, even with lower selling prices.
6 posted on 01/01/2005 9:48:32 PM PST by steve86
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To: BearWash

Good news for California.... affordable housing for me!! Only 14% of the peeps in SLO county can afford a home. Many were bought by speculators for SB county. Last time the bottom dropped out only 12% could afford homes. It dropped by 1/4 of the price. I'm hoping for the same so when I'm ready to buy in about 1-2 years, I'll be prepped for some crazy forclosure or find some decent deals.


7 posted on 01/01/2005 9:49:27 PM PST by Porterville (Liberal babyboomers... creating hoops for professionals, to protect their unqualified positions)
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To: BearWash

Oh, I don't know. This was all new development. Austin, TX, has gone through about three boom-bust cycles since I first moved there in the mid 70's. People overbuild and the bottom drops out for a while. However, the prices you're talking about here don't sound like bargain prices to a guy that's living in a two story 100 year old house with three porches and some nifty renovations (that I paid $73K for), it sounds pretty expensive.


8 posted on 01/01/2005 9:50:15 PM PST by Richard Kimball (Crawford Pirates, Texas State Football Champions!!!!!!!)
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To: Richard Kimball
it sounds pretty expensive.

Well, it does to me, too, since I've never paid more than 63k for a house.

I have to go -- will check the thread in the morning.

9 posted on 01/01/2005 9:52:36 PM PST by steve86
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To: BearWash

I was out in Vegas recently. You can drive for miles and miles outside of town and see development after development going up. It's a shocking thing to see.


10 posted on 01/01/2005 9:56:11 PM PST by durasell (Friends are so alarming, My lover's never charming...)
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To: ThisLittleLightofMine

as it has everywhere? been to the SF Bay Area lately? sheesh... the market was soft in 2000-2002 (meaning it was level). i think there will be a correction at some point (too much UP lately), but given the geographic constaints, and the Dem-dominated regional and state gummits, i see no change in the overall supply-demand equation, nor commute times. so, unless there is a crash across multiple business sectors, the housing prices in this are will continue to be driven by the income of dual earner professional couples... which right now, puts your FIRST home purchase at about $600K. want a 3/2 in a nice school district less than 30 minutes from work? try $900K and up. ouch.


11 posted on 01/01/2005 9:56:18 PM PST by leakinInTheBlueSea
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To: BearWash

Well, your analysis is a bit off.

Tis true the outrageous sellers market is now over as the supply of available houses is now equal to the demand.

The market was superheated and this caused a unbelievable runup in prices, which then resulted in a sudden, huge supply of new and resale homes put up for sale.

Obviously, this leads to a lowering of prices as the supply is now in line with demand.

As to a spirally down of home prices for years to come, that is not going to happen.

What is gone is the five buyers bidding tens of thousands over the listed price within the first hour of the house going sale - that was when there were no houses avaiable to buy.

I know. I moved here in October 2003 and found nothing available in the 1/2 acre, one story 3500 sf range.

We signed a contract for such a house in April 2004. Only the water lines are in and it now looks like April 2005 before it will be finished.

Why? No subs are available - they are so busy & booked up.

Oh yeah, hundreds of homes are done, waiting for closing, but Nevada Power can't put in the meters in those developments!

Its a boomtown and prices will go up & down.

40% of new buyers are from CA.

Average time on market is now 110 days instead of 110 hours.

New construction selling prices - not listed prices - are about $200 - 210 per sf.


12 posted on 01/01/2005 9:57:39 PM PST by Seeking the truth (0cents.com - 18k gold Pajama Patrol Badges coming soon!)
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To: Richard Kimball

that is the issue... expansion. areas with no room for expansion will be less likely to bust, as they are driven more by constrained supply than anything else. the biggest worry for these markets in CA is a big quake... took 10 yrs for the northridge market to recover.


13 posted on 01/01/2005 10:01:12 PM PST by leakinInTheBlueSea
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To: BearWash

If I am reading you right what has happened is that the speculators moved into the market and drove the prices up through the roof and then thought they were going to flip these homes for a big profit.
All these people were in on a sucker bet and thats about all.
If the size of these homes and lots are what you say we are talking about seriously overpriced property. As we all things it will settle and the true worth will become apparent.


14 posted on 01/01/2005 10:02:54 PM PST by Captain Peter Blood
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To: Seeking the truth

Are there jobs to support all these new people?


15 posted on 01/01/2005 10:03:44 PM PST by durasell (Friends are so alarming, My lover's never charming...)
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To: durasell

2% unemployment since I've been here.

6-7,000 people per month moving to Las Vegas.


16 posted on 01/01/2005 10:10:46 PM PST by Seeking the truth (0cents.com - 18k gold Pajama Patrol Badges coming soon!)
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To: durasell

2% unemployment since I've been here.

6-7,000 people per month moving to Las Vegas.


17 posted on 01/01/2005 10:11:00 PM PST by Seeking the truth (0cents.com - 18k gold Pajama Patrol Badges coming soon!)
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To: Seeking the truth

How long can that be sustained? And, will other industries follow the people there? Tourist towns are horrifying and Vegas, in my opinion, the scariest of all - since it requires a constant flow of visitors who spend three days and then go home.


18 posted on 01/01/2005 10:14:16 PM PST by durasell (Friends are so alarming, My lover's never charming...)
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To: leakinInTheBlueSea

I am waiting for that quake.


19 posted on 01/01/2005 10:16:09 PM PST by mindspy
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To: mindspy

I'm torn... my wife and I own here, which would make a big quake a bad thing, but we are on the east side of the san andreas which would give us ocean-front property ;)


20 posted on 01/01/2005 10:22:43 PM PST by leakinInTheBlueSea
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