Las Vegas, Nevada Real Estate Agent’s Las Vegas Homes, Condos, Land, Commercial Real Estate and Personal Blog

  I have come to believe that Las Vegas real estate has entered an irrational depression period after celebrating with irrational exuberance for a few years. When Allen Greenspan speaks, I tape the interview or the speech and watch it over and over until my wife gets so tired of it that she erases it. Answering a reporter’s question about whether his job got easier with experience, his answer was a big NO, reasoning that economic conditions are dependent on human nature and that human nature is not only flawed, it had failed to improve during his tenure, so his job never got easier.The whole roller coaster ride in the Las Vegas real estate market can be attributed to flawed human nature as Mr. Greenspan has brilliantly observed. In the hot days of Las Vegas real estate, new home builders would raise prices on their new houses by 10 thousand dollars every other week and the buyer’s line would only get longer. When Beazer homes announced the grand opening for their community on Cliff Shadows in Northwest Las Vegas, lines of new home buyers formed 4 days prior to the grand opening and whoever won the lottery to purchase a new house would come out of the sales trailer, beaming like a lottery winner. Pulte, another Las Vegas new home builder raised the home price for one of their Summerlin communities by 25%-30%, or $200,000 overnight and still kept selling homes. Home buyers weren’t choosy at that time and would buy anything they could get their hands on.

Talk about irrational exuberance, these people were not buying a home, what they were really doing is more like buying Wall Street stock options, with all the risk and rewards involved in such transactions, except that they thought they were financing their purchase at historically low interest rates and with a much longer term than a stock trader can obtain.

What I am trying to say is that the reason for purchasing so many homes and condos in the Las Vegas area was that these buyers were blinded to all other factors in a home or condo transaction, except seeing an upward trend in Las Vegas home and condo pricing and hoped to make a quick buck by flipping a Las Vegas property and making a quick profit.

Well, it did not work out the way these buyers were hoping, and the foreclosure problem reared its ugly head and real estate pricings in Las Vegas, with the exception of a few areas, started a downward spiral trend. Low and behold the same faulty human nature has the public looking like a deer in the head lights and again all they can see is the downward trend in Las Vegas real estate pricing, forgetting the fundamentals, just like they did when Las Vegas real estate was on fire. Except that this time they suffer from irrational depression.

If a person exhibits great happiness for no reason and a short time later goes into depression, he/she would be diagnosed as bipolar and be given medication. Naturally the question to ask is, is the pubic bipolar?

My visit to Loft 5, re-enforced my belief that Las Vegas real estate pricing is no longer based on logic and fundamentals, just as it was in the run up phase. I was lucky enough to be guided on the tour of model lofts by the marketing director for Loft 5. She shared my frustration with the Las Vegas condo market trends as I believe that with their low pricing and an additional 10% contribution from the seller, these well built lofts with a great location to boot would be selling briskly. But then again, the public is hypnotized.

I will do the next blog post about the downward pricing pressure that foreclosed condos have been putting on the new condo builders pricing as the builders have to compete with other units in their buildings that have been foreclosed or are listed as short sales.

Related web-site links: Buying Las Vegas new condos for sale, getting the best deal for a Las Vegas condo, Las Vegas condos for sale, short sale condominiums, foreclosed condos, HUD homes and fixer-uppers