A Winning Streak Goes Bust: Ghost Towns of Las Vegas [VIDEO]

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Given its place in American mythology, it's not surprising that Las Vegas has picked up a lot of nicknames. From "Sin City" to "Marriage Capital of the World," its various appellations highlight the town's temptations as well as its pitfalls. But Vegas' most important nickname may well be "the City of Second Chances"; after all, while the gambling mecca is famous for loose slots and blackjack, its real currency is not money, but hope. For the trusting, it promises that pennies can turn into fortunes, that cities can grow out of the desert, and -- for the most recent wave of pilgrims -- that property values can rise without limit.


For much of the past thirty years, it looked like that last promise would be fulfilled. Between 1980 and 2007, the population of the Las Vegas metropolitan area more than quadrupled, spurring a massive construction boom. With government programs encouraging home ownership, the city's population growth translated into rising home values.

As Harmony Homes' Rob Beville puts it, "Federal programs assist people to buy homes ... the more people qualified, the greater the demand. Once the demand started to shoot up, land values started to shoot up ... and prices started to climb. It basically got to a point where it couldn't sustain itself."

Just as Vegas flourished in boom times, it has been devastated by the economic crisis. For the last two years, it has led the country in foreclosures. Today, over 80% of Las Vegas mortgages are underwater, with homeowners owing more than the value of their homes.

Beville notes that banks foreclosed on 19,000 houses in Vegas through October, and that an estimated 50,000 homes are going to come back on the market at greatly reduced prices. With a flood of foreclosed homes competing with the abandoned and partially-constructed houses peppering the city, it doesn't look like housing prices in Las Vegas will rebound anytime soon.

The Las Vegas Sun's Tim Richardson echoes that grim prediction, noting that "No one expects there to be any increase in prices anytime soon ... I think everyone sort of agrees that it's going to be years before we see that."

As banks try to unload large numbers of unsaleable properties and abandoned homes rattle in the desert breeze, it seems that at least one Vegas truism has proved to be a lie: In the City of Second Chances, the house doesn't always win.

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mrscofla1

Stop Foreclosure for the Holidays!
Simply look over your loan application (i.e. form 1003). Review it to determine if the occupancy, employment, income and asset information is the same as you submitted to the loan officer. If not, get out your Deed of Trust. Look … Continue reading → Use this link to join our Group and Stop you Foreclosure process: http://www.bigtent.com/groups/mrsc

December 29 2010 at 6:01 PM Report abuse rate up rate down Reply
carstenslvnv

jump back to reality .... i purchased in LV for 505,000.00 in June of 2007 that same house is worth 175,000.00 -- you'd leave too ! Hello California !

December 29 2010 at 11:50 AM Report abuse rate up rate down Reply
larryatmanda

Well folks the inbalance of trade coupled with China and India playing games with the value of their money is causing major problems for the U.S. as well as other countries. Do you now hear that GIANT ******* SOUND, the one we warned about before NAFTA??? Well it has sucked a major portion of the middle class and service jobs out of this country and into any third world country that can bid a lower price for labor than their neighbor. If you can't earn a paycheck you are limited to what you can buy. Unemployment benefits become a negative taxpayer cost. We had better start looking at some substantial tarrifs and re-negociate NAFTA to a level playing field. Labor in the U.S. is getting their a$$ kicked hard.

December 28 2010 at 11:08 PM Report abuse rate up rate down Reply
bdhauto

And they re-elected Harry Reid. They must have a death wish.

December 24 2010 at 10:39 AM Report abuse +4 rate up rate down Reply
1 reply to bdhauto's comment
carstenslvnv

Harry Reid is Las Vegas' only hope only a fool wouldnt re elect

December 29 2010 at 11:46 AM Report abuse rate up rate down Reply
Robert

we were set up to fall so the rich can become richer

December 20 2010 at 9:23 AM Report abuse -1 rate up rate down Reply
1 reply to Robert's comment
scottvtm

No, You failed beacuse you were reckless or stupid, or both.

December 20 2010 at 5:53 PM Report abuse +5 rate up rate down Reply
twocntzworth

its just a dumb town in the middle of a hot desert--who needs it

December 18 2010 at 12:44 PM Report abuse -1 rate up rate down Reply
Larry

Will the Banks learn a lesson out of this? Forclosure cost money for Banks as well.

December 16 2010 at 8:43 AM Report abuse rate up rate down Reply
dwb3145

DOES ANYONE EVER WONDER WHY THE US HAS LOST SO MANY JOBS? WHEN THE US JOINED THE WTO IN 1995 MOST OF THE ORIGINAL SIGNERS HAD FAIRLY SIMILAR HOURLY WAGE SCALE, RANGING FROM $50.00 TO $20.00 PER HOUR. THIS MADE FOR VERY POSITIVE TRADE AMONG THE VARIOUS COUNTRIES AND GERERALLY WE SAW PROSPERITY FROM 1995 TO 2000. BUT IN 2000 CHINA AND INDIA WERE ADMITTED WITH AN AVERAGE HOURLY WAGE OF $0.25 PER HOUR. NOW ALL ECONOMIC THEORY TELLS US THAT FREE TRADE WILL MAKE THE TRADING COUNTRIES PROSPER. THAT IS IF THEY TRADE FREELY. IF ONE MEMBER HORDS CASH AND DOES NOT PLAY THE GAME THE WAY IT WAS INTENDED THEN THE RESULT WILL BE BAD. THAT IS WHAT IS HAPPENING WHTH CHINA AND THE REST OF THE WTO PARTNERS. THERE IS ONE LAW OF PHYSICS WHICH APPLIES HERE AND THAT IS WATER SEEKS ITS OWN LEVEL THAT IS WATER FLOWS DOWNHILL. THAT IS WHAT IS HAPPENING NOW. MONEY IS FLOWING TO CHINA AND WILL CONTINUE NON STOP UNTIL THERE IS WAGE PARITY AMONG ALL PARTIES INVOLVED. THE WTO NEGOTIATIONS FROM THE PAST MUST BE OPENED AGAIN TO ADDRESS THIS ISSUE OR THE PRESENT PAIN BEING INFLICTED ON THE US AND EUROPE WILL CONTINUE WITHOUT LETUP. OUR GOVERNMENT REALIZING THE GIANT PROBLEM THOUGHT HOUSING WOULD SAVE THE DAY AND KEEP THE ECON0MY GROWING. BUT WE ALL KNOW WHAT HAS HAPPENED AND ARE CONFUSED AS TO WHY IT HAPPENED. NO COUNTRY CAN BE STRONG IN ECONOMIC GROWTH WITHOUT MANUFACTURING AND AGRICULTURE. ONCE WE LOST MANUFACTURING TO LOW WAGE COUNTRIES THE INEVITABLE CONSEQUENCES HAVE OCCURED THAT IS LOST JOBS, LOST WAGES, AND LOST HOUSES AND FORECLOSURES. CHECK MATE!!! AS OUR BRILLIANT ECONOMISTS LIKE TO SAY WE HAVE WORKER DISRUPTIONS. OF COURSE THAT MAKES EVERYONE FEEL MUCH BETTER. WAKE UP AMERICA THIS COULD BE OUR LAST CHANCE.

December 13 2010 at 6:17 PM Report abuse rate up rate down Reply
Jetncat

The unions destroyed Las Vegas. High salaries and lots of promises that couldn't be kept. Besides the influx of illegals this becomes a receipe for disaster for any city. California & New York are next to collapse under the weight. Let's hope this serves as a warning to the rest of the country what could happen when you think something is going to be free as others pick up the tab.

December 13 2010 at 1:36 PM Report abuse +1 rate up rate down Reply
1 reply to Jetncat's comment
Jetncat

BTW- Thank Barney Frank and the 1996 community reinvestment act for giving people those homes they couldn't pay for.

December 13 2010 at 1:38 PM Report abuse +3 rate up rate down Reply
Billy Bob

jnewman708 --- I can't argue your point, you are absolutely correct. However the fact that the public unions control Nevada and most other states political future is obvious. We live with a socialist future, Glen Beck is a fool, but he's correct, put your money with multi-nationals.

December 11 2010 at 12:41 AM Report abuse rate up rate down Reply