Would you invest in Las Vegas?

[Michael Junior]

How are we feeling about Las Vegas? Yay or nay for amateur OOS investor? Looking at 4plexs

[Terry Lao]

@Michael Junior

@Bill B.

The best time to buy in Las Vegas was 2012-2016. The price bottomed when home values lost over 50% value from peak of $315k in June 2006. Now, SFR median as of Nov'18, was $296k. Still not back to the peak. While Los Angeles, Orange County, Bay Area, all reached peak and passed. Realtor.com forecast 2019 for Las Vegas appreciation to rise by 7.9%, with rank #2. This year 2018, Las Vegas is #1, surpassing Seattle at the top stop. The rankings are based upon percentage, and when you lost the most, you also have the most to gain. Las Vegas is also top spot for those leaving southern california due to cost of living and high taxes. Big plus, Las Vegas does not have state tax.

It is true that 4plexs are not in the best areas of Las Vegas. Most are east and north, but there are patches in spring valley, near the strip, and east of the 95 close to Summerlin. Most are also older, built before 1980. A current search of 4plexs vs. SFR, would show about a 2 percent ratio, which means for every 100 listings of SFR, there are 2 multi's. The basic supply demand economics would favor multi's.

Overall, crunch the numbers and see if makes sense on paper. A good rule of thumb would be the 1% rule. If OOS, then make sure you have good team in place, handyman, tenants, appliance guy, home warranty, etc. If decide to have management company, they will take 8-10%, but need to justify the cost. 

Terry