Here are the reasons for the decline:
- First time buyer pent up demand was released during the time when the first time buyer tax credit was available. Â This has created less demand.
- An over abundance of all cash investors making purchases for long term holds (renting in the mean time!) Â This has created more supply.
- Less population growth in the Las Vegas Valley. Â This has created less demand.
- Unemployment rate of 15% which isn’t enticing for incoming residents. Â This has create less demand.
- Builder inventory thrown into rental pool. Â This has created supply.
With an abundance of supply coupled with less demand it has created downward pressure on rental prices. Â Resale prices are VERY low, yes. Â It is essential to get comprehensive rental CMAs when looking at property. Â Here is a resource & tutorial for searching rental or resale comparables.
Neighborhood vacancies need to be looked at also. Â If resale prices are very cheap, there are an abundance of vacancies in the neighborhood, odds are other cash investors looking at those properties.
Remember the old adage: Â past performance is not indicative of future returns!
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