NASCAR and the Foreclosure Express
NASCAR has been one the hardest tickets in Las Vegas to secure, selling out six straight times prior to Sunday with attendance reaching 155,000 last year. Even Saturday's Sam's Town 300 race attracted 110,000, the third year in a row with attendance for the penultimate event reaching six-figures.
But this year 10,000 fewer seats were made available for the big race, and those on the ground trying to sell extra tickets — both Saturday and Sunday — found the market to be "no bid." Because of the punk economy, Speedway general manager Chris Powell decided not to erect a 10,000-seat temporary grandstand that has been used the last couple years.
NASCAR exemplifies these stagflationary times. Three-day ticket packages ranged in price from $135 to $192 apiece and beers were $7 a pop. An upgrade to a seat in the Dale Earnhardt Terrace or Richard Petty Terrace was $249. And premium seating in the Vegas Clubhouse would set you back $849, but that included someone fetching your brews for you. Race fans with an RV could park in the infield for $900 and those who wanted to avoid the traffic could copter in for $399 round trip. Helicopter tour companies, that normally tote tourists to the Grand Canyon, do great business on race Sunday. Standing in the parking lot before the race will remind you of the helicopter attack scene by the Air Calvary in the movie Apocalypse Now.
But, while fat cats were being airlifted to the track for beer and giant turkey legs, riders on The Foreclosure Express were munching on Danish and signing "All aboard the Foreclosure Express. Climb aboard, get your houses for less," while cruising around Vegas looking for bargains. The Express' proprietor, Barbara Zucker, told the Las Vegas Sun that she came up with those catchy lyrics while in shower. And she and her husband Marshall spent $100,000 on the 24-seat bus, hoping to capitalize on the sale of homes that are underwater, so to speak.
There are 11,000 bank-owned homes for (short) sale in Las Vegas according to RealtyTrac. So, the Zuckers' busing idea should pay off in spades. But, Las Vegas homeowners that are performing on their mortgages, don't great the Express with smiles. "In every neighborhood the bus goes through," writes Las Vegas Sun reporter Brendan Buhler, "people glare at it." Even little kids shake their fists and jeer at the Express bus.
The denizens of guard-gated Red Rock Country Club were especially annoyed when the bus rumbled through, according to Buhler. "Neighbors come out of their houses to glare at the Foreclosure Express like it's a flock of buzzards," he explains. The troop was there to look at a 2,243sf house that was now listed for $449,000, but was listed as recently as three months ago for $748,000. The home sold new in 2001 for $438,000.
But, that list price may be deceiving. One local realtor told me that selling banks are listing properties for low prices to attract activity, but will not accept offers at those prices. The minimum these banks will take is often $100,000 more than what the house is listed for according to my realtor source. The last house to sell in Red Rock Country Club went for $600,000.
Jen Leo, Los Angeles Times Travel Deal Blogger, described the Foreclosure Express tour she took as "a little like you are being sold a timeshare, and my husband and I were the only two people under 55 on the bus, but it did prove to be interesting. It is definitely an effective way to see many houses in a short period of time, and get a feel for the neighborhood."
Realtor Zucker warns Express riders that foreclosed homes aren't always in the best shape. People who lose their homes don't always treat properties well prior to vacating. Also, according to one local builder, potential buyers also should be wary of homes that have been vacant with no air conditioning operating during the hot summer months in Las Vegas. Homes will expand in the heat of the day and contract during the cool evenings causing structural damage if the temperature isn't regulated.
But, if Express riders get depressed considering other people's busted financial dreams, Zucker just cranks up another chorus of "All aboard the Foreclosure Express" between stops.
Business is now so good that the Zuckers are thinking of doubling down and buying another bus. Also looking to press his bet is Las Vegas Motor Speedway owner Bruton Smith who would like a second NASCAR race to be held at the Las Vegas Motor Speedway. It's reported that Smith's purchase of the New Hampshire International Speedway in November allows him to move one of that track's two NASCAR races to Las Vegas.
Once upon a time not so long ago, it seemed a great time to double down and buy homes in Las Vegas. It was thought at the time that prices always go up. After all, people always want houses, love a bargain and will pay whatever price to see Little E and Tony Stewart drive fast.
Maybe the Zuckers should rent that second bus, and Mr. Smith should be careful what he wishes for.
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.