Vegas Foreclosure Express Story
You may not be able to beat the house in Sin City, but you just might be able to beat the housing market. At least that's how two real estate agents, Barbara and Marshall Zucker, are placing their bets.
As they watched the Las Vegas foreclosure rate skyrocket 169% from 2006 to 2007 - making Nevada the most afflicted state in the nation - they also noticed that 40% of all home sales were foreclosed properties. So in February the couple bought a 24-seat Ford (F, Fortune 500) bus for $40,000, named it the Vegas Foreclosure Express, and began offering locals and out-of-staters thrice-weekly tours of repossessed homes.
"As with any business, you have to change and adapt based on the market to succeed and survive," says Barbara, 48.
Essentially the Zuckers are offering real estate's answer to speed dating. They screen houses, select the best dozen, and then take prospective clients on ten-minute viewings of each property. The trip is free, but they require riders to sign exclusive-representation agreements covering any property included in the tour. Plus they offer onboard finance consulting and educational seminars on homebuying.
The Zuckers were inspired by Cesar Dias, who claims he was the first in the country to operate a foreclosure bus. Dias, who began his Stockton, Calif., tours in September, says he has closed on 38 homes since then, after not selling any properties for months.
"We were in a corner - the market was down," says Dias, 43. "We had to either do something or sink."
Other foreclosure buses have cropped up across the country - including a second bus that started operating in Vegas after the Zuckers' - but most are rentals. The Zuckers, however, bought their bus and, for liability reasons, incorporated it separately from their real estate agency.
Before the Foreclosure Express, the Zuckers brokered annual sales of $150 million, worth an estimated $4.5 million in commissions; they have since scored 120 new clients - first-time buyers as well as out-of-state investors - and anticipate netting an additional 15 to 20 sales a month as a result of the tours. Thus far they have closed on two homes and have 26 offers in process. The 3% in fees on those two deals should more than cover the first month's cost of owning and operating the bus.
"The boomers are coming to Las Vegas instead of Florida," says Barbara. "They can't afford the storm insurance there. Las Vegas will recover, and we will adapt."