Is it a good idea to buy Las Vegas house now?

Many investors or California home owner found that houses price in Las Vegas is much more affordable and cost-efficient so they think it's a better investment than buying something old and small in LA. It is true that with $150,000, it's not difficult to find a single 3 bed and 2 bath house in Vegas while it's almost impossible to find one in Los Angeles area. However, is this really a good investment move? We don't think so. Why is that? Here we came up with three key points that lead us to believe that Vegas might not be able to regain it's glory as it is used to be.

1. Vegas is no longer the world's #1 casino

Without a doubt, China has replaced US to become the most powerful consuming country in the world. Even though many Chinese travelers have been to Vegas these days, they only account for less than 10% of the entire Chinese population. Then, how about the rest of 90% Chinese population? Where do they go when they want to get away trying their luck on the table? The answer is Macau. Macau has become the world #1 casino for the past three years while major casinos in Vegas have experienced huge deficit. Since casino business is the main revenue source of Vegas, it's hard to believe that house price will grow as much when the economy of the city will not be as prosperous. 

2. Hard to rent out in the long run

Most of resident live in Vegas working at Casinos. Since the overall casino business is not doing well these years, fewer new hiring opportunity will rise. In this case, there will be low rental demand because workers are not coming to town. Although the property management fee is relatively low in Vegas(around $100 monthly), it is still an overhead cost to investor when tenants are hard to find. In the long run, the house vacancy will again rise, which will eventually lead to house price stagnate.   

3. Business meeting/show relocate

Vegas used to be the #1 place where many business entities to host heir annual meeting, even some of the famous trade show are taken place in Vegas annually, such as CES, General Merchandise, and etc. These business activities in deed account for huge percentage of the revenue of all the major hotels in Vegas.  However, this might not be the case in the future. Many of the big companies, such as Microsoft, have decided to drop out from the CES show to cut their expense because they figure that Internet is more efficient and cost-effective way to debut their new product or messages. On the other hand, many major shows and meetings have been relocated either to Shanghai or to Beijing simply because China customers are their main focus now. All above phenomenon indirectly shows that Vegas has less importance to the business entities so it will eventually lead to less business activity and even worse economy. If this were the case,  the house price will never be good in the future.

All in all, we don't encourage small investors to buy houses in Vegas and hope the house price go up in the long run because the house value might not be back up for a while and even if it did go up in 10 years, is there a market for you to sell at the price you want? 

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