Investors from Asia are taking advantage of housing prices that have plummeted in recent years, buying foreclosures and short sales at below what it would cost to build them.
Kevin Chu's Hong-Kong investment firm owns property in Las Vegas, but he's never seen any of it. So his first visit to the U.S. is to inspect the houses in Las Vegas.
In the past 18 months, the firm he works for, The Creations Group, bought up distressed homes all over the U.S. — including 13 Las Vegas houses at fire sale prices.
Tracy Bennett, the local property manager, is driving Chu to see one of his firm's houses that has just been renovated.
She points to a disaster of a house that's clearly vacant. Blue graffiti cover the garage. Trash is piled in the yard. Before anyone can say anything, Bennett laughs.
"I'm kidding," she says.
But it is a reminder of the bleak housing reality here, where foreclosure rates are more than three times the national average. Thousands of bank-owned properties that sit empty. Thankfully, for Chu, his real house down the block is in much better shape.
It's a modest one-story house. The firm bought it for $55,000. At the height of the market, it could have sold for more than $200,000. Inside it's clean, with fresh paint. It's ready for a tenant.
"It looks very good, much better than I expected," he says.
In fact, the U.S. housing market as a whole looks much better than expected to Chu's boss, Danny Lim.
"In some places the types of prices that we are getting, I think it's you know, once in a generation, perhaps once in a lifetime kind of opportunity," says Lim, who was in Miami looking for more property.
Andy Chu, a local real estate agent, says he is advertising in the Asian newspapers. He points out the strong rental market in Las Vegas means houses here can quickly become income-producing properties.
"We let them know, hey look, U.S. is a good place to invest," he says.
Andy Chu's clients from Asia are now a quarter of his business, and he wants more.
They're good customers. They often will buy several properties and pay in cash, which means he doesn't have to spend months waiting for financing to be approved.
"From a business perspective, you can get paid in four days or get paid in six months," he says.
The 2012 strategy for the Las Vegas chapter of the Asian Real Estate Association of America is to help local Realtors get even more international business through new Web tools and networking opportunities.
"If you are a homegrown product how do you network with someone in Canada? How do you work with someone in China, Vietnam or Taiwan? It is very hard. That's the reason why our association is trying to bridge that gap," explains Joseph Lai, the association's chapter president.
There aren't reliable data to know just how many properties in Las Vegas are selling to out-of-country buyers. Local Realtors say the bulk of their international business is coming from Asia and Canada. Lai says these buyers are helping the local housing market recover.
"International investors, we see them as absorbing a lot of the inventory," empty houses that otherwise might be left vacant, he says.
"They are going to come in, make them income-producing properties, and then they are going to fix them up, get them into livable shape, get them rented out," he says.
There is a backlog of tens of thousands more foreclosures expected to roll onto the Las Vegas market in the coming months. So that means soon there will be a lot more empty houses for eager investors to buy up.