Las Vegas Real Estate Talk!

eerie · Joined: 03 Oct 2006 Posts: 185

I have some friends in Vegas who purchased several houses when the market was so hot last year and two years ago.

Now they owe way more than what the property is worth and can't sell it.

What to do? What's the longterm outlook on Vegas real estate?

kelkat · Joined: 03 Oct 2006 Posts: 98

With interests rates sure to creep higher, the seller's market is probably gone for a while. They need to cut their losses while they can - or else rent if that's an option.

eerie · Joined: 03 Oct 2006 Posts: 185

Some friends of ours thought they were making out like bandits - buying and selling at huge profits. Then they bought something a bit too much - and the market stalled and they are stuck with it for the time being. They are worried, to say the least.

kelkat · Joined: 03 Oct 2006 Posts: 98

I learned that lesson at a young age. You never risk more than you can afford to lose - whether it's gambling, loaning, or investing.

I hate it for your friends, but hopefully they will only get burned this once if at all.

eerie · Joined: 03 Oct 2006 Posts: 185

yes, that's the casino motto : if you have to win - it's time to quit.

kelkat · Joined: 03 Oct 2006 Posts: 98

Casino motto, huh? It was just a hard learned lesson by my own parents. They got into trouble with the interest rate in the 70's - early 80's and ended up having to sale at a loss. I would like to say that they learned, but atleast the lesson passed on to one of the kids!

eerie · Joined: 03 Oct 2006 Posts: 185

Our interest rates are so good compared to back then in your parents time. Interest rates back in the 70's were up around 10%, I think.

kelkat · Joined: 03 Oct 2006 Posts: 98

Try in the 20%'s. It got way out of control and hurt lots of people. Fortunately, most of them hadn't bought like they do today. People atleast had some equity in their homes. Today, people seemed determined to buy as much house as they can legally squeeze out of their income despite their needs or ability to actually pay for it!

LeighA · Joined: 24 Oct 2006 Posts: 64

kelkat · Joined: 03 Oct 2006 Posts: 98

I've been reading a book on debt freedowm and his suggestion is that your housing payments should never exceed 25% of one income. I think that's smart even when you are starting to invest as well!

eerie · Joined: 03 Oct 2006 Posts: 185

That's true.

The thing is, it used to be harder to qualify for a mortgage, and with good reasons. There are certain amounts of payments we can afford each month without feeling stressed financially, and those guidelines were created for a reason.

While purchasing a home is exciting, we have to pay attention to the details that were created in our best interests.

LyricB · Joined: 28 Sep 2006 Posts: 63

I don't see how all the investors didn't see what was coming...even on the news a few years ago they were warning of an impending real estate bubble burst.

SeeMe · Joined: 19 Jan 2007 Posts: 49

I know, but I think it's a case of the economists crying wolf. They have been saying for so long that people started to not believe it - people don't understand that economic trends take a long time to develop.

LyricB · Joined: 28 Sep 2006 Posts: 63

I don't know...I listened. It seemed to make sense when they started sounding the alarm. I could't have been the only person to take notice.

shalamar · Joined: 04 Jun 2007 Posts: 19 Location: writer and artisan

The good news is that the market flips after a while. What goes up must go down and vice versa. If your friends can ride the market out it might work out yet, in the meantime perhaps they should rent the property out so it brings them some kind of return.
_________________
thanks for checking out my writing and art at:
http://www.reginasunderland.com
http://www.cafepress.com/shalamar
http://www.cafepress.com/masterandslave (adults only please....erotic art)