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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Vosilla who wrote (42690)	9/30/2005 12:33:52 PM
From: John Vosilla	Respond to of 110194

A Condo Boom Few Have Faith In A pair of reports looks at the Las Vegas condo boom. "There were 93 luxury condominium projects, totaling 175 towers and 47,590 units, proposed, planned or under construction in the Las Vegas Valley during the second quarter. By contrast, there were only 29,248 new homes sold last year." "'There is insufficient market demand to absorb all of the units currently in the development pipeline,' said Brian Gordon. 'We estimate that between 30 and 40 percent of the projects currently planned will be developed during the next eight to 10 years.'" "'The level of planned investment in the Southern Nevada market is remarkable and continues to grow,' said Jeremy Aguero. 'That having been said, we are somewhat cautious about the realities that exist between perceived and actual demand for these units.'" "In the next five years there will be tens of thousands of new condominiums on or near the Strip. Keep in mind that the term 'affordable housing' is being put on a plane to other destinations. A small studio unit in most of these buildings will run you around $500,000, while the really nice places with views are going to cost well over $1 million." "Can Vegas sustain this kind of growth? Already we are seeing signs of weakness. The planned Aqua Blue condo project just east of the Strip had no less than Michael Jordan behind it, but the project was scrapped a few weeks ago as nervous developers started to forecast a glut in the market." "The pool of people who are willing to invest this kind of money in the condo market is a fairly limited one to begin with, and if they don't see a return on their investment (many of the units will be placed into rental pools) things are going to go from boom to bust really quick." thehousingbubble2.blogspot.com