Apparently, a strong housing market doesn’t really depend on people having good jobs in order to come up with a down payment and service a mortgage. Whether that strong housing market is healthy or not is another matter as detailed in this special report at Reuters.
The once-beleaguered Las Vegas housing market has been on fire since investment firms led by Blackstone Group LP, Colony Capital and American Homes 4 Rent began buying homes here some eight months ago, backed by $8 billion in investor cash to spend nationally.
These big investors and a handful of others have bought at least 55,000 single-family homes across the U.S. in the past year. In the Vegas area alone, they have accounted for at least 10 percent of the homes sold since January 2012, according to a Reuters analysis of housing transactions.
That added firepower helps explain why home prices in this metropolitan area of 2 million people are up 30 percent over a year ago, far more than the national average of 10 percent.
There’s lots more in this story, most of it disturbing such as 60 percent of Las Vegas home sales being all cash and a reminder that hot money from Wall Street doesn’t tend to stick around once the artificial appreciation stops – when that will be is anyone’s guess.
I missed the S&P Case-Shiller housing report earlier in the week where is looks like Las Vegas is about to overtake Phoenix as the nation’s hottest housing market.