Vegas Free-for-All - Another Eulogy to Nevada's Housing Boom

Another Eulogy to Nevada's Housing Boom

chefantwon

Mar 16, 2011
10:12am

Quote

Originally posted by: DonDiego

Quote
Originally posted by: bardolator2
. . . We have spent much time recently in Cape Coral, which is about as bad as Las Vegas.

DonDiego is quite familiar with Cape Coral. In fact, in his callow youth, . . . long before Cape Coral was even a community, . . . in the early 1970s young DonDiego purchased two "Florida homesites", . . . one on the East Coast and one on the West Coast just across the Caloosahatchee River from Cape Coral. He paid $59/month on the first and $39/month on the second for 8 years.

Then he waited patiently, . . . and nothing happened. Nothing happened. Nothing happened until the 1990s when prices began to rise. And then the 2000s when prices began to gallop. DonDiego sold the properties in 2004/2005 and pocketed a nice profit, . . . and then watched as prices nearly doubled over the next 18 months. Bummer!

Bummer, . . . until the crash. He doubts he could find a buyer at any price now.

Looks like DonDiego made a good investment and cashed in. Just remember DD, unless your either a major expert OR have direct knowledge about an investment (insider information) your not going to make all that you could have. Nice one.

teflonron82

Mar 16, 2011
10:41am

Block User

I am having a little trouble understanding the logic of the story. Guy is 57, retires, buys a home he wants, where he wants, and can afford. The current resale value of said home is now less than he paid. He does not need to sell, he can afford the mortgage.

Why walk?

bardolator2

Mar 16, 2011
10:50am

Block User

I recently asked a realtor what the going rate would be for a non-canalfront lot in Cape Coral. She quoted me five grand. However, the lot used as an example was said to have real estate taxes of $1200 annually, so something somewhere does not make sense. This is a SWFL realtor we're talking about. Maybe Hiassen is right.

I would think it is the best possible time to buy in one of these depressed markets if one wished to actually live there. As an investment, no comment.

Canalfront lots in Cape Coral/Fort Myers can be listed for upwards of $100K, or a lot more if they are prime; however, it is uncertain who would want to buy one, or for what price, with houses so cheap. It amazes me that our house on our lot in Akron, Ohio of all places would command a better price than the same house on a nice canalfront lot in Cape Coral, Florida- a vacationland with a world class sport fishery reachable from your dock.

Don

Mar 16, 2011
12:35pm

Block User

Perhaps DonDiego can address bardolator's amazement.

"[In] Cape Coral-Fort Myers, the number [of "underwater mortgages"] is 84,165 properties, or 51.1% of the market."
Ref: Gulf Coast Business Review

DonDiego cannot find rankings by SMSA, but this might be the current record.

frugalfan

Mar 16, 2011
9:00pm

Block User

Quote

Originally posted by: KSeitz
I am having a little trouble understanding the logic of the story. Guy is 57, retires, buys a home he wants, where he wants, and can afford. The current resale value of said home is now less than he paid. He does not need to sell, he can afford the mortgage.

Why walk?

I have the same concern with folks that simply walk away from a deal that did not turn out as they had hoped, this all may be legal but.

Don

Mar 17, 2011
12:03am

Block User

Quote

He paid $240,000 for the house. DonDiego'd estimate a mortgage around $200,000.

The market value of the house is now $80,000.

He can continue making around $1200-per-month payments on the principle and interest plus taxes, insurance, maintenance, etc.
OR
He can stop making payments and let the bank take the house, eliminating his $200,000 debt . . . and rent something for a lot less than.

n.b. DonDiego is not endorsing this action, . . . just explaining the logic.

Roulette Man

Mar 17, 2011
12:56am

Block User

Quote

Originally posted by: DonDiego

Quote
Originally posted by: KSeitz
I am having a little trouble understanding the logic of the story. Guy is 57, retires, buys a home he wants, where he wants, and can afford. The current resale value of said home is now less than he paid. He does not need to sell, he can afford the mortgage.

Why walk?

My parents were over $200,000 upside down on their mortgage when real estate prices tumbled in the early 90's. They knew that the prices would come back, and they did. I think one needs to look at the big picture. If you don't plan to reside at a place for ten, twenty, or more years, then one needs to show concern on being upside down. However if you love your home and plan to be there for a very long time, then you need to ride the storm out.

The only problem with much of Las Vegas housing is that most of the homes are what I call "cookie cutter" homes in housing tracts. They all look the same. They have very little clearance between homes. They have small front and back yards.

LeoXVI

Mar 18, 2011
10:42am

Block User

He purchased the home in 2004 for $240,00. 2011 R/E value at $80.000. What area is this?

chefantwon

Mar 18, 2011
11:31am

Block User

Quote

Originally posted by: Roulette Man

Quote
Originally posted by: DonDiego
Quote
Originally posted by: KSeitz
I am having a little trouble understanding the logic of the story. Guy is 57, retires, buys a home he wants, where he wants, and can afford. The current resale value of said home is now less than he paid. He does not need to sell, he can afford the mortgage.

Why walk?
He paid $240,000 for the house. DonDiego'd estimate a mortgage around $200,000.

The market value of the house is now $80,000.

He can continue making around $1200-per-month payments on the principle and interest plus taxes, insurance, maintenance, etc.
OR
He can stop making payments and let the bank take the house, eliminating his $200,000 debt . . . and rent something for a lot less than.

n.b. DonDiego is not endorsing this action, . . . just explaining the logic.

Yep, a guy named Huber did that cookie cutter crap here in Dayton, Ohio and later in a place called Xenia. You may of heard of it as all of his houses were flattened by a tornado back in the '70's. He forgot to put in any basements, just crawl spaces. Now, all new housing in Xenia must have a basement. (since the tornado)

jatki

Mar 18, 2011
5:42pm

Block User

I remember that time,I lived in beavercreek. We got hail the size of baseballs. As a 9 yr old i thought it was really cool and saved a bunch of them in our freezer. And it was tornado(s),5 I beleive touchdowned, pretty much flattened xenia.

J

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