I tend to focus on the larger Las Vegas picture. But I spend enormous time scrutinizing market impacts on my first development, Manhattan Condominiums.
Manhattan is a good laboratory for the study of the impact of the Housing Correction. We completed the project between 2006 and 2007 and have sold 90% of it. Some of the people who bought condominiums from us have been foreclosed upon, though.
One thing that Manhattan really validates is a historical truism: Foreclosures clean up markets.
In the first quarter of 2008, the number of condominiums sold on the resale market at Manhattan was ZERO. There was a single condominium sold through the developer sales office.
In the second quarter of 2008, which we are now half way through, we have already closed on 2 units and 7 more are in contract. Most of these 9 units are post-foreclosure units.
The foreclosures have arguably driven the market price lower, but the market price is where deals are getting done, and no deals were getting done in the first quarter.
Keep this in mind when you hear the housingdoomsters wail about how many foreclosures are in the pipeline. Keep in mind that most of those foreclosures are already listed for sale today, and that the practical impact of foreclosure is that those same units will be repriced to a market level, and will get bought and occupied.