Talk about the rich getting poorer! Just look what's happening to those million-dollar McMansions out in the deserts of the USA.
"Pity the poor homeowner in Las Vegas," writes our colleague Byron King, "with 12-inch tiles on the floor instead of the de rigueur 20-inch tiles. Or thin granite veneer near the bathtub instead of granite slab. These manses are now obsolete, and perhaps unsaleable to any but the least hip. Really, can you spell 'Loser?' Dude, where's your seeing-eye dog?"
Byron is referring to the speed with which a rich man's house in Las Vegas becomes a not-so-rich man's house... The hot desert sun seems to do to housing fashions about the same thing it does to lettuce. Crisp new places wilt after only a few years. Then, you can barely give them away. The rich don't want them because they're no longer cool And the poor can't afford them. What can you do? Blow them up?
The LA Times ads details:
"They blow up aging casinos in this town. Now, some are wondering what to do about yesterday's desert dream homes.
"Take the foreclosed million-dollar house realty agent Michael Antos recently showed. Please.
"To the untrained eye, the four-bedroom, five-bath retreat may appear top-drawer, shimmering with granite and marble throughout, and with posh touches like a pool with a sandy beach entry.
"But Antos pointed out that the house was showing its age. After all, it was built in 2000. In Vegas, that makes it as dated as a coin-operated slot machine.
"The chandelier? Plastic. The granite surrounding the upstairs bathtub is tile, not slab. And those polished travertine tiles in the entryway may look luxurious, but at 12 inches by 12 inches, they just won't cut it today.
"Now you've gotta have at least 20 by 20 to sell something at this price," Antos explained.
"The housing slump has fattened the inventory of unsold homes throughout the country, and a staggering 51% of them in Las Vegas are vacant. But there's another twist to the story here: a glut of glitzy homes.
"About 1,000 houses are listed for sale in Las Vegas for $1 million or higher, more than 600 of them built since 2004. But unless they've been constructed in the last year or two, the properties are considered out-of-date, making them all that more difficult to sell, real estate agents say."
Bill Bonner
The Daily Reckoning Australia
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About the Author
Best-selling investment author Bill Bonner is the founder and president of Agora Publishing, one of the world's most successful consumer newsletter companies. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail The Daily Reckoning.
Comment by Pete on 15 April 2008:
Haha, love it. Is there no end to this 'want' vs 'need'.
I doubt a single person that visits this site feels even the slightest bit sorry for them.
Comment by Han on 16 April 2008:
Hi Bill, will what is happening to the housing market in US happen in Australia?
Thanks
Comment by Steve Bellis on 6 August 2008:
There is a simple solution:- Criminalize land lording (euphemistically referred to as property investing). Land lording is the criminal activity of getting the poor to pay for the property assets of the rich.Property investors are the scum of this earth.