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Old 08-28-2007, 06:16 AM
Micturition Man Micturition Man is offline
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Join Date: Nov 2003
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Default Thoughts on LV real estate at this time?

Note: I made this post too long, please just skip down to the bolded part if you don't want to read the preamble.

The LV high-end real estate market has been overheated for a while now, with lots of high-rise condo projects in the works that will probably never get completed.

So I've been thinking that it would probably be a good time to buy and hold some LV real estate. If not now then sometime soon... like next 1-2 years maybe? (That's just a guess, I'm not really familiar with real estate cycles.)

But anyway just the other day I was told of a purchase opportunity in a mid-rise development that is 90% complete but has not sold any units yet (not unusual as it sounds actually).

Basically the developer wants to sell the first unit soon, and he wants to sell it at original appraised price from like 12 months ago or something. The reason he wants to get a good price is so he can use the unit as a "comparable" to persuade other people to buy at that price.

However the market is definitely softer now than it was a year ago, so his current asking price is too high.

As compensation for this he is offering the following: he will pay all mortgage, tax, and HOA fees for 2 years, AND he will rent the unit for two years to use as a model unit.

Less significantly he will let the purchaser keep the model unit furnishings and he will also give away some shell commercial space on the ground floor.

Now without giving out specifics there is no way one can appraise this deal.

What I am interested in though is people's opinions on how close the LV high-end condo market is to a bottom.

For example if the market were to steadily decline for several more years, this would not be a great investment (though it still might be slightly profitable because of the incentives, if I could sell the unit at just a small loss in two years).

On the other hand if the market will only drop like 10% more over the next year and then hold or rebound, this becomes quite a strong 2-year investment.

So anyway opinons?
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