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Rodney · 12-22-2005, 04:59 PM

Nevada's growth comes from:

* People moving there to retire -- land is cheap. Most of the retirees are from California cashing out $600K for a 1600 square foot home in the Bay Area for half again the house on ten times the lot at half the price out by Carson City.
* Businesses moving there -- usually, small-to-medium-sized businesses that have most of their customer base in California, and find they can still serve their Cal customers while paying much less tax, much less on rent, etc.
* The growth of Las Vegas as a destination.

Although most Nevadans would not want to hear this, their growth largely comes from them becoming more and more a satellite of the California economy. Even Las Vegas, which gets business from all over the world, would be shy one lung without the California business. When California sneezes, Nevada catches a cold.

I've seen Nevada -- at least the places where most of the people live -- and my evaluation ranges from "okay but nothing special" (Reno) to "You gotta be kidding" (Las Vegas), and all those lonely isolated towns dotted at great intervals along the interstates. Vegas in particular is growing fast because of the growth of the resort factor there, and the fact that housing is still cheap enough (and casino/hotel salaries good enough) that career hotel staff and resort staff can afford to buy a house. Try that in Long Beach.

I see nothing wrong with any of this. But the boom is fragile. Like I say, when California sneezes.... Put another way, if there were a collapse in real estate prices in California, how many people would still want to move to Nevada? And what would happen to housing prices there? A lot of Nevada's appeal depends on market forces (real estate prices, California disposable income) and gov't artifacts (high taxes vs. low taxes) that can change. Add to that the fact that the new big source of water for all the growth in LV is coming from a _water table,_ not a renewable water resource.

I'll be very interested to see what happens in Nevada over the next 20 years -- whether it crashes when California does, or strengthens enough off California to find its own way when bad times come.

12-22-2005, 04:59 PM	#17 (permalink)
Rodney Observant Ruminant Location: Rich Wannabe Hippie Town	Nevada's growth comes from: * People moving there to retire -- land is cheap. Most of the retirees are from California cashing out $600K for a 1600 square foot home in the Bay Area for half again the house on ten times the lot at half the price out by Carson City. * Businesses moving there -- usually, small-to-medium-sized businesses that have most of their customer base in California, and find they can still serve their Cal customers while paying much less tax, much less on rent, etc. * The growth of Las Vegas as a destination. Although most Nevadans would not want to hear this, their growth largely comes from them becoming more and more a satellite of the California economy. Even Las Vegas, which gets business from all over the world, would be shy one lung without the California business. When California sneezes, Nevada catches a cold. I've seen Nevada -- at least the places where most of the people live -- and my evaluation ranges from "okay but nothing special" (Reno) to "You gotta be kidding" (Las Vegas), and all those lonely isolated towns dotted at great intervals along the interstates. Vegas in particular is growing fast because of the growth of the resort factor there, and the fact that housing is still cheap enough (and casino/hotel salaries good enough) that career hotel staff and resort staff can afford to buy a house. Try that in Long Beach. I see nothing wrong with any of this. But the boom is fragile. Like I say, when California sneezes.... Put another way, if there were a collapse in real estate prices in California, how many people would still want to move to Nevada? And what would happen to housing prices there? A lot of Nevada's appeal depends on market forces (real estate prices, California disposable income) and gov't artifacts (high taxes vs. low taxes) that can change. Add to that the fact that the new big source of water for all the growth in LV is coming from a _water table,_ not a renewable water resource. I'll be very interested to see what happens in Nevada over the next 20 years -- whether it crashes when California does, or strengthens enough off California to find its own way when bad times come.