Time for a new housing boom already? Las Vegas thinks so.
Construction has nearly doubled in Las Vegas, Phoenix and Tuscon, despite the fact that houses are still being abandoned due to foreclosure. What's happening in the Southwest?
While Dave Bing is knocking down houses in Detroit because of the over supply, in sunny Las Vegas and Phoenix, home builders are seeing demand, so more supply is on its way. Richard Lee, who can best be described as perpetually optimistic, told the crowd at a new home opening that everyone has a new opportunity to cash in on the next Las Vegas boom. “We’re going to come back like you’ve never seen us before.”
There are lots of foreclosures on the market, but most buyers don’t want to buy a house where, as one homebuilder used to put it, “someone else clipped their toenails.” So, two million vacant houses or not, builders are responding to demand. Whether the demand is only stimulated by government tax credits or not, remains to be seen. “For the first time in three or four years, we have pent-up demand,” said [Las Vegas homebuilder] American West’s vice president for sales, Jeff Canarelli.
Stephen F. Auth, chief investment officer at the financial services company Federated Investors, says, “The great housing depression is nearly over.”
Pent-up demand? Housing depression over? But there are two million vacant houses and likely 15+ million homeowners underwater on their houses? Perhaps the builders have it right, millions will strategically default, walk away, and buy brand new homes for hundreds of thousands of dollars less.
What happens to the abandoned repossessions? Mayor Bing has a plan.
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