Financial Markets
The Dow Jones rallied Friday and ended the day up 259 pts. The Dow was up 1.4% for the week and up 5% for the 2011 year. The stock market’s struggle to reach consistent gains probably has a role in the Southern Nevada real estate market and could partially explain the abundance of cash buyers in our market. As an example, $100,000 investment in stocks, assuming we work off the Dow Jones performance as an average, would net a return of $5,000 for the year…Take that same $100,000 initial investment used to purchase a home in Las Vegas for cash, rent it out for $1,000 per month, deduct $250 per month for taxes, insurance and maintenance, and the investor earns roughly $9,000 per year, or 9%.....I won’t even bring up the “A” word. (Appreciation) but certainly has an added benefit to the investment.
Southern Nevada Real Estate and Economy
Below is an interesting article in the RJ that breaks down the foreclosure numbers in Southern Nevada. The statistic that stands out to me the most is that roughly 100,000 homes have been foreclosed on since 2007, which is 18% of the existing homes, or nearly 1 out of every 5 homes. Experts say we are about ½-way through the foreclosure crisis, so in the end, it could be said that 1 out of every 2 homes would have been foreclosed on from 2007 to 2015. I can’t imagine we would see anything like this in our lifetimes.
On a much lighter note, according the blog below, the Clark County Commission approved a 26 acre water park located a few miles south of the strip and is expected to open Memorial Day 2012!?...This has nothing to do with Southern Nevada real estate that I can think of other than added tourism and something fun to do with our kids during the hot summer months…I take that back, it could lead to an uptick in tourism, providing for an uptick in profitability for the casinos, prompting them to increase hiring thereby lowering unemployment rates which would lead to an increase in real estate sales.
