REAL ESTATE:

His pitch: Invest here, now

Contrarian marketing Vegas homes to Californians as smart buys

Thursday, Dec. 11, 2008 | 2 a.m.

Tiffany Brown

Realtor Jim Souza, standing this week outside his home in south Las Vegas, is optimistic about Las Vegas real estate for the long term. He says now is the time to buy because housing investments can pay for themselves with rental income.

At the height of the real estate madness a couple of years ago, the San Francisco Bay Area was littered with billboards and radio ads hyping real estate in Las Vegas.

Real Estate in Crisis

None of the ads encouraged people to move to Las Vegas — they were selling houses here as can’t-lose investments.

But all of that stopped when the real estate bubble went down like the Hindenburg and house flipping became as socially acceptable as selling kittens as a food additive.

Which is why my dad was so surprised when he got a glossy postcard in the mail urging him to invest in, yes, “property in exciting Las Vegas.”

“Exciting” barely begins to describe it.

So who is this person selling real estate investments in Las Vegas?

Jim Souza, 56. He just got his real estate license in August.

Of 2008.

He is very bullish on the (eventual) future of Las Vegas real estate. “I can’t imagine why everyone isn’t,” he says.

He admits he is something of a contrarian. He takes Warren Buffet’s motto to heart: “Be fearful when others are greedy and greedy when others are fearful.”

And he’s looking for a few good investors.

His theory: Real estate may not have hit bottom yet, but it’s passed two significant benchmarks. Houses are now cheaper to buy than to build. And house prices are so low that renting them out can pay the mortgage payments.

Eventually people will start building new houses again, at which point houses bought now would yield profits when they’re sold. In the meantime, the houses can pay for themselves, in Souza’s view.

Souza is confident in this theory. He has bought a dozen houses so far with his own money, if you count the one he bought four years ago to live in.

“It makes me sick how much my house has lost,” he says, “but I made it up by buying 11 more.”

(He says he got the real estate license because he was sick of paying commission.)

The only thing Souza isn’t confident about is when this turnaround will come. Three months? Six months? A year, maybe five?

Well, whenever. All of his investment houses are currently rented out, he says.

In the meantime, Souza keeps costs low by being his own property manager.

And how did Souza’s Bay Area real estate advertising campaign work out?

Of the 10,000 fliers he sent out, he’s been contacted by four people who want to schedule trips to Vegas to look at houses.

“The momentum isn’t there, yet.”

Discussion: 14 comments so far…

By tvegas

12/11/08 at 8:34 a.m.

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God help us.. another idiot with a real estate license
By Casper

12/11/08 at 9 a.m.

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How many more neighborhoods have to be destroyed by the greed of this type of thinking? I know of at least five subdivisions in the southeast part of the valley that are suffering repercussions from this mentality. The true home owners go in blindly and buy what they perceive is their dream house in what seems to be a nice neighborhood. Soon theafter an out of state investor buys what he thinks is a quick flip property. The investor soons finds that the property is not an easy flip so he has to rent it out to keep the property. These guys don't really care who they rent it to, just so they get cash coming in. The true home owner soon finds his neighborhood being overrun by gang members and drug dealers. The true home owner is the true victim of this type of greed mentality
By gqbossing

12/11/08 at 9:40 a.m.

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with unemployment at 8% and heading towards 10% it's going to be hard to rent out houses to people with no money and when people aren't moving here any longer...
By mikegino

12/11/08 at 9:57 a.m.

Comment removed by staff.
By kramer

12/11/08 at 10:01 a.m.

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At least he is not afraid of his shadow like the previous posters. Furthermore, he is attempting to build confidence in a bad market rather then run and hide in the corner and perpetuate the mess like the pervious posters are doing.

Recession is manifestation of fear and negativity by the masses. While it is easier to sit behind a computer and find the negative in another person's action, the above posters could do more to contribute something positive in this current environment.
By jfnance32

12/11/08 at 10:11 a.m.

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He probably has got it right for a 5 to 10 year investment.

Housing prices are finally stabilizing in Las Vegas and inventory of houses for sale are fairly low.

Most likely, when the economy fully recovers in a 3 to 4 years then the Las Vegas real estate will probably take off again.

The only risk is a complete total depression which we are all screwed any way if that happens.

I think it is a good investment.
By LVGlads

12/11/08 at 10:14 a.m.

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I'm purchasing my first condo on Monday. It was pretty hard for me to rent when I could buy a condo for less and obtain a generous $7,500 Dollar for Dollar IRS tax credit for first time home buyers.

Jim my friend, I wish you all the best! May you be handsomely rewarded in the years to come for your patience and determination.
By ksand99

12/11/08 at 11:32 a.m.

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"Housing prices are finally stabilizing in Las Vegas and inventory of houses for sale are fairly low."

Home prices in November were 32% lower than they were a year ago. Yup! Stabilized!
By LasVegas2009

12/11/08 at 11:34 a.m.

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11 houses! Well this guy has the right idea just rent them until the market comes back and then sell them. He may have to wait a few years but this guy is on the right track. I expect most people to post negative feed back about this article. This is the time to buy if your in Vegas and the people who do will be rewarded when the rest are trying to get in. History has shown again and again that those who swim against the current often are the first to feed and get fat when the tide turns. I purchased in October and bought for less than $70 a square foot! Im not an investor just a person who sat on the side lines waiting for the market to fall so I could get in cheap. I have no plans to sell even when the market returns but buy for less that half of building costs will give me options later. And like LVGlds said the $7,500 dollar credit is just a bonus! Even if I have to back it back its and interest free loan that gives me 15 years to pay off.
By jfnance32

12/11/08 at 2:13 p.m.

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I think some people do not understand what the word "stabilize" means.

Merriam Webster Online Dictionary: Stabilize - To limit fluctuations of(as prices)

Here is a story from the Sun titled: "Home prices show signs of stability in October"

http://www.lasvegassun.com/news/2008/nov...

Of course, housing prices are down. All I am saying is that the huge price drops from one month to the next month have seem to stop.

So hopefully we have reach bottom. Usually a wise investor buys lows and sells high.
By johnevegas

12/11/08 at 4:03 p.m.

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"All I am saying is that the huge price drops from one month to the next month have seem to stop."

I agree Jim. Homes seem to be moving more regularly now that they have reached early 2005 prices. We're seeing more steady sales activity as of late. So not stable yet, but more stable than before.
By LVRocks

12/11/08 at 8:04 p.m.

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In case anyone is interested in contacting Jim Souza, I found out he has a website at www.vegaswesthomes.com
By johnevegas

12/12/08 at 5:11 a.m.

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"These guys don't really care who they rent it to..."

Um...ever heard of Equal Rights? There are plenty of laws covering why you cannot discriminate against people. This is especially true when it comes to housing.
By spartacus84

12/12/08 at 5:48 p.m.

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"The momentum" just followed slim and fat chance out the door.
Did you sell U.S. cars before this by any chance?