Real Estate Investor · Redondo Beach, CA · Member since 2017 · 4 posts · 3 votes
I figured I would save everyone the Vegas/Casino puns and get right to the point. I've been looking at the Las Vegas market for SFH and multi-family buy and hold. How are you guys and gals liking the market right now for buy and hold in Vegas?
If anyone is currently working with good property management and agent/brokers can you share your experience; I'd love to connect and learn more about the market.
@Blair Poelman one could also argue that 2011 prices were way under valued. Given all of the population growth projections for the Vegas metro, I think it's hard to call this the top of the market now. Still, cap rates are super low, so I see your point.
sorry terry, figured you’d be able to sell them for at least $100k per unit. 5% 30 year loan on $95k is $510/mo. Could you seller finance them for $100k with $5k down? (If they are paying over $550/mo rent they could afford utilities.) you could play with interest and sales price to make purchase less than current rent.
I did my bulk refinancing right. I have 2 x 4% 30 year loans, some 3.75% 30 years and a couple 3% 15 year loans.
Are the utilities higher because it’s a 4plex? My water is $30, sewer is $20, garbage is $15. (2400sf single story with a pool but just two adults in it.)
Just recently read in a book that Las Vegas and other cities including Phoenix are some of the most up and down markets. The swings can be quick and steep. As long as you prepare for this I think you could definitely make it work. Just research rents and what the swings in the local market will do to the rents! Good luck!
I define the term value as buying low in relation to sales price, and the ability to rehab and increase rents , which cash flows to attract future investor at higher sales price.
I don't see value in downtown due to the neighborhood being more run down and less like that an investor will fix up and flip. Those 300k and up are nice inside and out, but it is the other homes and rentals that will bring yours down.
This 4plex, has (2) 1 bedroom, (1) 2 bedroom, and (1) 3 bedroom. There would be work to divide into separate parcels, but gain would not be that much more. In fact, there was a 4 plex in same HOA, that was for sale, and you would have to get (4) separate loans to buy all four.
If your water is 30, sewer is 20, and garbage is 15, total is 65. Just times it by 4, and 260 is what you pay monthly for a 4plex.
If there is a downturn due to the global trade war that began early 2018, history teaches us that rents hold better than real estate values. I agree with many posters here that recommend multi-families over SFHs. So long as there are jobs, rents should drop slower than depreciation. The other option is hoard cash, build an 720+ credit score and season an entity to enter the commercial market if and when values come down.
@Joseph Campbell Not sure if you bought anything for buy-and-hold in Las Vegas in 2017. As of 2020 Q1 Las Vegas is overvalued at +18% as based on income. In fact, the 2nd most overvalued in the U.S. top 100 cities by population. And that in spite of very poor 2007 peak-current price performance of -23%. Reason is incomes performed poorly. Overall not a strong market from a nationwide markets perspective.
That didn't age well. Like the last depression, SFH is outperforming MF. We were raising rents then while MF lowered or went vacant. We're raising them again. If they bought in 2017 they're probably up 20-25% overall or nearly 100% COC with 25% down. As SFH prices continue to rise along with rents.
But this does show that nobody who was predicting doom and gloom 2 years ago and “sell now!” Has come forward to apologize for costing people 100’s of thousand of dollars. I sincerely doubt this new generation will either.