http://lasvegashomes.com/blog/archive_201512/sort_entrydatetime-desc/ As the exhibit below illustrates, Nevada is one of five states furthest from peak pricing. There are several reasons why this alleviates many of our concerns about current value. One, current prices can be explained fairly well when we look at the level of supply in the market and demand drivers such as improving employment and population growth. What is hard to explain is why a closet sized condominium in San Francisco can be so expensive. Foreign hot money and a vibrant technology and finance sector may explain some of this but it doesn't explain if those trends are stable. What we are seeing in Nevada is predicated on what we think are more reasonable demand predictors. In Reno, the Tesla plant is a real demand driver and additionally, Reno has a fairly diverse economy and is seeing job growth in several sectors. Current multifamily occupancies for Class A product is in the high 90 percent range. In Las Vegas, job growth is a little uneven amongst the employment sectors but is experiencing overall growth. Construction, while a shadow if it’s past, has rebounded from the extreme lows in the recession. New businesses are forming in or moving to Las Vegas. All this is occurring while home price growth has flattened. This pause reduces our concern that we have become detached from reality again. The last thing we want is a speculative bubble. While it is fun while the party is going, that hangover is hard to forget. Finally, what many of these indicators are signaling is that there may be some upside in prices. We aren't fans of the buy high, sell higher strategy and we fear some areas may be experiencing this style of buying. Please see Corelogic's report here: http://www.corelogic.com/research/hpi/corelogic_hpi_october_2015.pdf http://lasvegashomes.com/blog/11808/reviewing-corelogic's-hpi-report/ Mon, 14 Dec 2015 12:00:00 -0800