Photo credit: Moyan Brenn
Investors are betting on Las Vegas real estate, as the market shows signs that the tables might be turning.
According to RealtyTrac, Vegas previously led America's housing collapse, with August seeing the highest mortgage default rates in the country for the 22 nd month in a row. House prices, too, have fallen 60 per cent from 2006. And in economic terms, according to the Southern Nevada Index of Leading Economic Indicators , Las Vegas "continues to lag the nation".
Investing in Las Vegas property, then, is a bit of a gamble. But for many overseas buyers, it's a risk worth taking, as positive signs suggest the odds are stacked in their favour.
House sales, in particular, are showing promise. At the end of September, 36,000 homes had been sold in 2011, according to the National Association of Realtors – an 11 per cent increase on 2010. The number of homes on the market is down as a result. There are just 10,000 properties listed at present, one broker told CNN , a supply that is expected to meet demand for only two more months.
"I think the turnaround will be slow, but new home pricing is close to its bottom," Realty One Group commented.
Visitors are still drawn to Sin City, even if they are not spending in the casinos. The Las Vegas Convention and Visitors Authority told The Associated Press that 3.3 million people visited in September, "up 5.5 per cent from September 2010 [and] the 19 th monthly increase in year-to-year visitation".
Some are staying, too, with 200,000 new residents in the area since 2006, significantly higher than the average growth rate across America. The increase in tourism has created new retail and service jobs, which are thought to be attracting new homeowners. Most significantly, CNN adds, unemployment fell by 2 per cent in September, one of the highest drops in US metro areas.
As people return to the area and the economy starts to improve, overseas investors are starting to up the stakes. Homes in Vegas are roughly 30 per cent cheaper than the national average and a large number of foreclosures are keeping those prices down, allowing buyers to pick up affordable properties before the roulette wheel starts spinning again. Indeed, sales rose again last month, up by 20 per cent compared to 2010, a report from the Greater Las Vegas Association of Realtors revealed yesterday .
With the market bottomed out and sales increasing, the odds are looking good for Las Vegas real estate.
Would you bet on Las Vegas property?
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