House odds go bad in Las Vegas.

Speculators who were looking to make some quick and easy cash by ‘flipping’ properties are seeing bad times all over the US, but it’s particularly bad in Clark County Nevada (Las Vegas) – One in every 30 houses there started the foreclosure process last year.

More than other states hit by the mortgage lending crunch, the high foreclosure rate in Nevada, California and Florida was driven by speculation, said Rick Sharga, vice president of marketing for Realty Trac. “It was a combustible mix of risky loans and risky real estate deals,” he said.

Russ Valone, the chief executive of research firm MarketPointe Realty Advisors, said speculators in San Diego were putting deposits on downtown condo units under construction, assuming they could sell them at a profit when they were finished.

“There were guys out there that were rolling the dice just as if they were going to Las Vegas,” Valone said.

When the market slowed, many buyers forfeited their deposits, or let their properties get repossessed by the banks. As a result, the inventory of unoccupied condo units downtown since early 2005 has soared fivefold, he said.

That article also mentions that predictions of a 1% price decline across the US in the next year has pretty much killed ‘flipping for a profit’ in these previously frothy markets.

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mold city
mold city
13 years ago

Sure glad we don't have that problem here – No one would speculate on real estate here right?

digi
digi
13 years ago

I guess if there was a clear way to find out how much speculation is going on in a market that would cut down on speculation. Sounds like a self-reinforcing problem on the way up and the way down.