Stop The Dice! Developers Set To Square Off
A: Developers in Vegas are 'scaling back' with their projects while developers in Miami are going from 'acquisition' mode to 'disposition' mode. The most highly speculative markets in housing are always the first to tumble; and tumble they shall! Expect developers to compete with each other via incentives and price cuts in what looks to be a bloody 2006 in some markets!
According to a recent TIME article, Vegas Condos Go Cold, several high level condo developers including the likes of companies backed by Michael Jordan, Ivana Trump, & George Cloony are either "folding or selling their holdings".
According to the article, John Restrepo, head of a Las Vegas real estate and economic consulting firm, says:
"It's another case of irrational exuberance...There is a market for high-rise condo hotels here; but it's not as deep as people thought it was. The days of the two guys from the East Coast or Canada coming into town and promoting a condo development with a website and a dream are over."
Another source, ENR.com, which recently published an article, "Las Vegas Condo Boom Cooling As Some Projects Cancelled", goes into a bit more detail about some developers and their plans; or lack thereof.
The same John Restropo as quoted above goes on to say:
"There are 60,000 condominium and 19,000 condo-hotel units currently proposed, planned or under construction in the Las Vegas Valley....But we anticipate that less than 25% of those units will actually be built in the next five years."
It's going to be interesting to see how some of these markets outside NYC, including Miami, Las Vegas, Los Angeles, Phoenix, etc. fare over the course of 2006. I'm leaning towards the "not so good" side! New York City is a bit different and should not be compared to these highly speculative markets. Remember that NYC is an island and is currently about 75% Co-op; Most Co-ops adhere to strict policies in approving a new shareholder leaving speculators to buy condo's and condop's.
~ Vegas Condos Go Cold
~ Las Vegas Condo Boom Cooling As Some Projects Are Cancelled
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