Las Vegas Economic Downturn Increasing "High-line" Auto Repos
Back in the day of cheap credit, rising asset values and booming real estate markets, many wanted to "Live the Las Vegas Dream" so they charged top dollar for flashy new and expensive toys -- to show others how smart/successful they were...
Well, times are beginning to change and these "dreams" are turning into nightmares for thousands.
The recovery agent & debt collection business however is thriving from these personal nightmares.
Henri Leleu from Automobile Recovery Bureau (ARB) of Las Vegas say's business is booming.
"It seems like no one is really exempt from this cycle," says Leleu.
"We're pulling cars from mortgage bankers, real-estate firms," Leleu says. "We're talking about upper-echelon people. It's like nobody seems to have that savings or extra borrowing ability to get them over the hump."
From November 2006 to March 2007, ARB was averaging a recovery of 43 high-line cars a month. For the same period a year later, ARB averaged 55 high-line cars a month. These figures include brand names such as Mercedes, Porsche and Bentley.
Leleu says that a year ago, approximately 75% of the cars recovered were C- and E-class Mercedes Benz, carrying sticker prices of $35,000 to $80,000. A year later, the numbers are up by 28% or so, but the true picture here is that now 75% of the high-line cars ARB is recovering are valued in the range of $100,000 to $500,000.
Leleu's says that since October-November last year, ARB Las Vegas has gone from handling 18 to 20 accounts daily to 40 to 45 accounts. The amount of items for each account varies; it could be one car or two street sweepers or several pieces of construction equipment.
As for cars, which are still the most frequently recovered item, Leleu says his company is seizing as many as 160 a month, up from 100 a month last year. He has two agents earning as much as $2,000 a week, or between $65 and $100 per car. ARB Las Vegas charges creditors an average of $300 and $325 for a repossession and an additional $125 to $150 for the vehicle's keys.
That increase in volume isn't exclusive to Leleu's region, either. He says he has met with other recovery agents from across the country, and they've reported the same -- from Oklahoma to Virginia, Colorado to Florida.
Just think about it for a moment: This significant repo increase is taking place while we enjoy a very low (official) 5% unemployment rate in Nevada. Can you imagine what the repo business will be like when the hotel/gaming/state, etc layoff's really pick up steam (from declining tourism/gaming revenue/taxable sales base)?
The Las Vegas Economic Downturn Has Started
Ok... Move along now, nothing to see... We have no recession here...