Las Vegas city has 3 times the rentals of Los Angeles city and L.A. has 6 times the population – U-Haul rate trends and home sales higher in Las Vegas than peak months of the bubble driven by absentee investors.
The Las Vegas housing market expanded and popped the quickest and highlights the gambling euphoria that engulfed the housing bubble. The housing market in Las Vegas has served as an albatross to drag the state of Nevada down to the point that now the desert state ranks as number one in unemployment nationwide. One of the interesting trends going on in Las Vegas right now is that home sales are actually happening at a faster pace than anytime during the housing bubble. Yet these are low priced foreclosure re-sales being fueled by speculators of a different sort. Prices have gotten low enough in the market that investors are plowing in like baseball players on teammates after winning the World Series. It is a big bet that the economy will turn around soon enough to justify either rental prices or re-sale values. The economy hasn’t responded so let us examine the details of the Las Vegas market.
The Federal Reserve plans on exporting the U.S. middle class abroad with Quantitative Easing II. QE1 cost $1.7 trillion and took the underemployment rate from 10 percent to 17 percent.
The Federal Reserve is entering uncharted territory with this second phase of quantitative easing. The public may or may not be aware that the Fed has already embarked on quantitative easing (QE1) and has grown their balance sheet by $1.7 trillion (that’s $1,700,000,000,000) by exchanging U.S. Treasuries for questionable assets including a shopping mall in Oklahoma. It is obvious that the Fed is betting on the public being unaware of this action to continue on their unabashed shadow bailout of the banking industry. Some think that this will somehow cause residential real estate prices to boom. Yet this flies directly in the face of a middle class that is quickly seeing their nominal income decrease. How will they support higher home prices? It doesn’t compute but what is certain is the demise of the U.S. dollar is already happening.
Real estate is a bad investment does not show up in Google News and other interesting housing trends – Strategic default searches went viral in 2010. Banks betting against American homeowners.
82 percent of American households have internet access. Of those with internet access, a large number are homeowners. The vast majority use Google to search for many things including foreclosure advice or investigating the real estate market. The online trends give of a sense of what is happening in the collective psyche of our country that really isn’t revealed through the conventional press. The housing market seems to be entering a second leg down and many are now predicting nationwide home prices to fall by 5 to 10 percent in the upcoming year. With that being said, very few articles have made their way to the popular press regarding real estate as a bad investment. Even today, there is still a sense that no matter the price, real estate will always be a good financial choice. Let us examine the online trends and market behavior that surround the current real estate digital psychology.
Income disequilibrium – The top 74 Americans earned an average of $518 million in the economic troubling year of 2009. Top 1 percent earned 14 percent of all earnings in 2009 versus 11 percent in 1989.
The disappearing middle class in the United States is a troubling consequence of the culmination of economic and political policies of many decades. There is a sense, and probably why so much frustration is out in the country, that the once comfortable life of being middle class is slowly slipping through our hands. The American public senses something is amiss with the economic system and clearly is not happy. When we look at income data from the Social Security Administration records, we realize that even in years that Americans have suffered greatly, the wealthiest in our country actually became a lot richer. The jump is incredible and begs the question that in a year where millions lost their jobs and witnessed collapsing home values how was it possible for a few to make hundreds of millions of dollars and sometimes billions of dollars? Let us first examine the income data for this elite group.