If you are thinking about living in or buying or selling a home in Las Vegas, this is for you. A lot is being said about the Las Vegas real estate market and you deserve to know the truth. I will discuss the history of the Las Vegas market, a detailed analysis of the current situation and my predictions here. The Real Estate Market in Las Vegas is experiencing very interesting twist at present (October 2007). Let us first assess the past and the current situation:
1. The city's history: The Las Vegas Valley has come a long way from its modest beginnings in 1905 as the site of a railroad town. Even the most optimistic speculator could not have foreseen the booming economy and real estate market that is modern Las Vegas. Legalization of gambling, construction of Hoover Dam, arrival of World War II defense industries, testing of the atomic bomb and, more recently, construction of the resort-style lavish, theme-based casinos and expansion of tourism in the 1990s. The most prosperous times for Las Vegas have been the last 2 decades. Such prosperity has brought along with it a large increase in employment and population figures. And of course, that means thousands of homes were built and the city has expanded to almost three times its area over the last 2 decades.
2. Market Trends and Average Home prices: According to the Urban Land Institute, Residential building permits for Clark County set a record in 2005, with about 38,400 permits issued-nearly double the 20,700 permits issued in 1990. New home sales have nearly tripled from 10,500 units in 1990 to 29,124 in 2006, according to data from Las Vegas-based Home Builders Research. The average price of new single-family homes has more than doubled from $155,500 in 2000 to $330,100 in 2006. Throughout the 1990's, house prices rose. The period between 2001 and 2005, however, saw a spike like none before. House prices almost rose by 150 rise in rents in less than 2-3 years. Urban Land Institute figures say that monthly rents increased from an annual average of $768 in the fourth quarter of 2004 to $850 in the fourth quarter of 2006. Interestingly, this meant that renting a single-family house was almost the same cost as renting an apartment in some cases. Hence, in the same period, apartment vacancy rose 6. Earlier, I pointed out that prices rose because of two reasons - Increase in employment and speculative behavior. The portion of the price-rise due to speculation went a little too far and is now falling back to more practical levels. However, note that the valley is still experiencing significant inward population migration, which means the prices will bounce back and continue to rise, however, the chances are that the prices will rise at a slower rate, more in relation to the influx of people to the town and the creation of jobs.
3. The condo-conversion race: However, incomes, while rising significantly, have not kept pace with this rapid viral growth in the town. This led to a rapid drop in affordability of the houses. To counter this drop, and meet the demand of the sector of the population that cannot afford the high-priced single family homes, developers built a large number of condominium- conversion projects, which were relatively low-priced. For a while, this seemed like the answer to the situation. However, condo-conversions meant a reduction in the number of apartments available for rent. This resulted in a 10-25% rise in rents in less than 2-3 years. Urban Land Institute figures say that monthly rents increased from an annual average of $768 in the fourth quarter of 2004 to $850 in the fourth quarter of 2006. Interestingly, this meant that renting a single-family house was almost the same cost as renting an apartment in some cases. Hence, in the same period, apartment vacancy rose 6% as well owing to these "shadow rentals" of single-family houses. High-rise condominiums are a new addition to the mix. According to SalesTraq's latest Las Vegas Hi Rise Handbook, 78 luxury condominium projects were under construction or proposed in the valley at the end of the second quarter of this year, with a construction value of $31.1 billion. Mid-rise projects may be the answer to the current situation. They offer the benefits of pricing and scale and are usually acceptable in both urban and suburban areas.
4. The cause for the slowdown: Now, let's come to the rough part. Since mid- 2005, housing prices in the valley have decreased by 5-20%. Earlier, I pointed out that prices rose because of two reasons - Increase in employment and speculative behavior. The portion of the price-rise due to speculation went a little too far and is now falling back to more practical levels.
However, note that the valley is still experiencing significant inward population migration, which means the prices will bounce back and continue to rise, however, the chances are that the prices will rise at a slower rate, more in relation to the influx of people to the town and the creation of jobs.
5. My prediction: Hence, my prediction is that the downward trend in prices in Las Vegas will continue throughout the first two quarters of 2008 and beyond that, will see a stable phase were some house prices will go up while others will remain stable. In about three years, in 2010-2011, with the creation of several thousand jobs at the City Center and the four new casino projects that are under construction as well as the new industries that are getting created in the valley, home prices will start an upward trend again, but this time, at a regular pace.
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--Albert Einstein
I have always been fascinated with the past. As a youngster, the older a story, myth, or legend was, the better I liked it. By quite a young age, David, Icarus, and Ulysses seemed quite real to me.
That interest soon led me into reading histories as well. The battle of Thermopylae (where in 480 BC the Spartan-led Greeks heroically held a narrow mountain pass to block the passage of the Persian army under Xerxes until betrayed by a traitor) seemed as immediate to me as D-Day (the Allied invasion of Normandy in France to establish a Western front against Germany during World War II) did to people who were alive in 1944.
By the time I had finished the sixth grade, I had read all of the standard history texts used through the end of high school. Branching out, I also began to read biographies and autobiographies to meet other prominent figures from the past and bring them into my present for consideration.
By the time I finished high school, I knew that I wanted to study history in college. That was a happy choice because Harvard University, where I would be an undergraduate, was unusually well stocked with great historians.
Quickly, my tutors there taught me to disregard secondary texts and to focus on original documents written by contemporaries who had participated in or observed the events. Old newspapers, diaries, pamphlets, and written versions of oral histories became my stalking grounds.
From this experience with the raw material of history, I began to form a different impression of how improvements occur than what had been described to me by books and teachers. I had been told that with rare exceptions, making progress was continual and ever upward. In this view, new knowledge was highly sought after by most and quickly appreciated.
By studying day-to-day records of those who first imagined improvements, I found instead that many of the great advances in knowledge were widely ignored or long delayed in implementation. For example, Leonardo da Vinci's notebooks contained many practical ideas that lay fallow for centuries before the ideas became everyday realities.
The Romans knew how to make mortar for their roads that lasted for centuries by mixing in fine pumice emitted from Mount Etna while modern roads made with coarser materials crumble after a few seasons. During the Middle Ages in Europe, much classical learning was all but eradicated. Centuries passed before the Renaissance revived interest in and awareness of this earlier knowledge.
The Chinese became insular and lost their command of the seas after having once had the world's most advanced navy. The highly energetic Japanese similarly rested in suspended animation when it came to most improvements until forcibly exposed to the Industrial Revolution by Admiral Perry's gunboats. Until recently, modern Egyptians had no more idea of how their ancestors constructed the pyramids than they did how to clone camels.
Questioning thinkers have always tested the opportunity to improve on what was previously known, but those quests were hobbled because access to what had been known earlier was usually quite limited. Expand awareness of the best of earlier knowledge, and you could greatly expand potential to improve -- that much seemed obvious. The lack of access is worsened by so much knowledge existing in secret or near-secret conditions.
Paradoxically, some advances were once so well established that no one bothered to document them, such as the use of some rare herbs to treat medical problems. In addition, knowledge (or what seemed to pass for knowledge) was expanding much faster than any individual could absorb in more than a limited area.
To me, it seemed like there was one hope: Gather up the undeveloped ideas of people like Leonardo da Vinci and get busy working on them. But don't wait several hundred years to get started. Work on the most promising undeveloped ideas right after they are conceived. That's the first lesson of how to accelerate improvements.
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Srini Venkat has sinced written about articles on various topics from Games, Keyboard Synthesizer and Games. Tony Grissom has lived in Las Vegas all his life and is one of the most experienced Realtors in Las Vegas with over 20 years of experience in this business and hundreds of satisfied customers.He is also passionate about the sport of table tennis. Check ou. Srini Venkat's top article generates over 14800 views. Bookmark Srini Venkat to your Favourites.
Donald Mitchell has sinced written about articles on various topics from . Donald Mitchell is an author of seven books including Adventures of an Optimist, The 2,000 Percent Squared Solution, The 2,000 Percent Solution, The 2,000 Percent Solution Workbook, The Irresistible Growth Enterprise, and The Ultimate Competitive Advantag. Donald Mitchell's top article . Bookmark Donald Mitchell to your Favourites.