Is this the perfect storm?

My new partner has been a realtor in Las Vegas for over 15 years. He has never seen this many homes in escrow (or even close).  Right now there are almost 10,000 homes in Las Vegas under contract.  That’s crazy! Or is it? Right now we have 5 things happening in Las Vegas at the same time that are causing all of this demand for properties under $300,000 here.

1. The months from March through June are historically the best 4 months for real estate sales in Las Vegas.

2. Interest rates are at historical lows. 30 year fixed rates are under 5%

3. The $8,000 first time home buyer tax credit is causing people to believe that they can’t afford not to buy their first home right now.

4. The media is finally telling people that it is time to buy. Sunday’s Las Vegas Review Journal newspaper had an article called “Why houses look better and better” and that is just one such article of many across the nation.

5. The median price is down to $135,000 in Las Vegas.

So, is it the perfect storm? Well it is certainly having those types of results.  Right now in Las Vegas approximately 75% of the houses being sold are selling for full asking price or HIGHER.  Properties are hitting the market and being fought over by investors and would-be home buyers alike. Is it because there is a shortage of properties?  No, it’s because the banks are really desperate to unload these properties so they are pricing them below what the drastically reduced market sees as reasonable. 

The game is tricky though, and you need to be careful. For example, I know a condo complex where you can buy a 1 bedroom condo near the air force base for about $30K! The problem is that there are so many of them available, it still might not be a good investment. But if you are looking to live there, on an FHA first time home buyer loan, your principal and interest payment is going to be less than $150 per month!

Less than $150 per month!

Less than $150 per month!

Less than $150 per month!

Are you ready to get serious about buying Las Vegas real estate?  What are you waiting for?  If you would like help buying real estate in Las Vegas, whether for your personal use, or for investment, please call me.
702-369-6000

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Even the Mansions in Las Vegas are cheap now!

OK, I haven’t been here lately. I’ve been very busy. Lousy excuse, I know.

Here is how crazy pricing has gotten on Las Vegas Real Estate. Just a few hours ago, I was in a gated community in the south part of Las Vegas, in a mansion that was more than 6500 square feet of luxury and decadence. The master bedroom closet was bigger than many bedrooms and even had a refrigerator in it like in the new Heineken commercial. 5 bedrooms, 4 1/2 bathrooms, 3 living rooms, 4 car garage, 2 laundry rooms, expensive tile and stone everywhere, circular staircases – you get the picture. I can’t believe you could build this house for less than $200-$250 per square foot (and I’m sure that’s low). Now it did have some maintenance issues, but basically it was in good shape. Probably less than $20K in repairs needed.

Are you ready?

Are you sure?

You’re not going to believe it.

I didn’t believe it when I saw it on the MLS.

I had to go see it with my own eyes.

$71 per square foot. The bank is selling this house for less than $500,000. It JUST hit the market.

Are you ready to begin investing in Las Vegas real estate?  Now is the time.  Really.  What are you waiting for?  If you would like help buying real estate in Las Vegas, whether for your personal use, or for investment, please contact me.

www.CapeCodAREI.com/contact
702-369-6000

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B of A buys Countrywide – Maybe monopolies are a good idea?

A good friend of mine currently works for Countrywide Mortgage, but will be working for Bank of America soon.  Is he changing jobs?  No.   B of A is preparing to finalize the deal which has so far kept them profitable.  That’s right, B of A credits their liquidity to the acquisition of CW.  Neither B of A, nor CW seem to be in very bad shape!  When was the last time we heard any bad news about CW?

CW is writing a lot of loans for investors with excellent credit and at least 20% down, as well as First Time Home Buyers. Las Vegas has been a hotbed for this activity, but the loans are being written nationwide.  You hear so much negativity everywhere about banks not lending and the so called ‘credit crunch’.  Well if you want to call responsible lending a bad idea, then be my guest, but the truth is, money is flowing into the housing market and though there are fewer loans being written these days, the loans that are being written have a much smaller chance of default than what was being written just 2 years ago.  I think that is more helpful to us than just making loans for the sake of moving some money around.

Here in Las Vegas, you see more investors showing up to take advantage of the real estate prices. Check out the percentage of owner occupied homes in Las Vegas over the past 6 months in the chart at the bottom of this post.

Notice anything? Don’t be last!  Are you ready to begin investing in Las Vegas real estate?  Now is the time.  Really.  What are you waiting for?  If you would like help buying real estate in Las Vegas, whether for your personal use, or for investment, please contact me.
www.CapeCodAREI.com/contact

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Month TotalSales OwnerOcc %
Feb 2009 2,540 1,438 57%
Jan 2009 2,484 1,477 59%
Dec 2008 3,032 1,882 62%
Nov 2008 2,657 1,660 62%
Oct 2008 3,106 2,215 71%
Sept 2008 2,436 2,436 70%

 

Las Vegas home prices stabilizing?

I just became aware of some very interesting statistics about the Las Vegas housing market.  First I want to make sure you understand that the information in this particular post only pertains to Single Family Homes (SFR’s) and does not include Condo’s, Town Homes, multi-family or any other Las Vegas real estate.

For the first time in over 2 years, prices have been stable; for 9 straight weeks $180,000 is the median price and holding; even better, the supply of homes has decreased and demand for homes under $300,000 has increased. The local real estate market is behaving somewhat normally. 9 weeks ago we had 101 days supply available, now we have 66 days of supply and the number of properties going under contract are up.

What does this mean?  Are we out of the woods?  I seriously doubt it, but these are good indicators that good things are starting to happen.  I will tell you that this past weekend, as my good friend was driving back to Las Vegas from Los Angeles, he said that the traffic going towards L.A. was horrible – then he corrected himself and said that he would not have wanted to be driving in that traffic, but that it was good for Las Vegas.

It’s true that we still have problems here, but these are good things.  Are you ready to begin investing in Las Vegas real estate?  Now is the time.  Really.  What are you waiting for?  If you would like help buying real estate in Las Vegas, whether for your personal use, or for investment, please contact me.
www.MyFastEasySale.com

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Job creation is happening in Las Vegas

Last night, M Resort opened with nearly 2000 new hires, 12,000 more jobs are coming to City Center later this year, followed by thousands more expected from Cosmopolitan and Fontainebleau Resorts. These jobs have always created multiple spin-off jobs in the local area to not only support the properties, but additional services needed for more business and residents added in the community. Everyone of those employees need a place to buy groceries, clothes, gas and more.

Other service businesses continue to grow here as well. If you are a landscape contractor or want to start a pool maintenance company, we constantly have more lawns and more pools. That is what happens when 5000+ people move into your area every month.

There is the new airport, the Wal-Mart distribution center and a new call center for the City of Las Vegas Redevelopment Agency, which could be bringing as many as 2500 more jobs.  A few days ago Ecompass Group Affiliates, an electronics repair, parts, and logistics firm, announced they will be opening their own 38,000 square foot Las Vegas center. It will be located in ProLogis Park, where Amazon.com and Monster Cable have located in a 513,000 square foot building.

These latest non-hospitality jobs are not only a further diversification of the Las Vegas economy, they are a sign that the lower commercial and industrial rents and property pricing have made Las Vegas an even more appealing market to enter.  With it’s low-to-no tax structure, technology, communications and connectivity infrastructure, and logistics capabilities it offers so much to business locating in Las Vegas.

Relocation.com ranked Las Vegas as their top relocation city for 2008, and has predicted Las Vegas as the top relocation destination again for 2009.  Other predictions and surveys have also ranked Las Vegas high among top relocation cities of 2009.  This doesn’t come as a surprise as many (like me) in recent years have been looking to escape the cold nasty weather for warmer climates.  Frankly, I don’t know how people live in those places.

Remember, Las Vegas has more non-gaming entertainment per square mile than anywhere else in the world. Add no personal income taxes and it becomes more apparent. Combine this with the fantastic bargains in Las Vegas single family homes, and it becomes an even more attractive destination. All of this also provides businesses an ability to present these perks to potential hires, and to their additional advantage, an apparent desire of many wanting to relocate to Las Vegas.

No, we are not out of the woods yet, but this is where you are going to want your investment dollars, because Las Vegas will emerge earlier than any other metropolitan area.

If you would like help buying real estate in Las Vegas, whether for your personal use, or for investment, please contact me.
www.CapeCodAREI.com/contact

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FHA Loan Limit Back to $400,000 in Las Vegas

This has been confirmed! The FHA Loan Limit on Residential Real Estate in Las Vegas, NV among other areas has been moved back up to $400,000.

This is a game changer for our market! Since the loan limit was lowered at the beginning of the year, some have been very concerned about values in Las Vegas in the range between $417,000 (Conforming Loan Limit) and $287,500 (2009 Previous FHA Loan Limit). It was though that because of the difficult conforming loan guidelines and Mortgage Insurance (MI) policy guidelines, homes of that value would further deteriorate down to FHA limits. With limits raised back up, I think we averted this disaster. Couple this with continued low interest rates and we could see a market stabilization. Let’s keep our fingers crossed!

If you would like to confirm for yourself, here is the link to the loan limit website for HUD:
https://entp.hud.gov/idapp/html/hicost1.cfm.

Also, now that the loan limit has been raised again. Those that have FHA loans in that range can now take advantage of the FHA Streamline feature and capture the lower rates.

If you would like help taking advantage of these new developments, please contact me.
www.CapeCodAREI.com/contact

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Apartments are empty because people would rather rent houses.

If you were forced to move out of your house, and you looked in the newspaper right now, would you look under apartments for rent or houses for rent? The answer is simple. In addition, in many cases, you can convert that renter into a tenant-buyer, over time because they used to own a home and now have poor credit. If you offer them a chance to own your property with seller financing, in many cases they are going to do it. There is not a better tenant on the planet than a tenant-buyer. They are never late on the rent, they don’t call you when something breaks, they care for the yard and eliminate the need for property management.

I love the doom and gloom that is constantly being reported.  A new Forbes.com ranking lists Las Vegas as the emptiest city in America, the result of the foreclosure crisis and the surplus of empty homes and apartments built when times were good. Construction has ground to a halt. The Commerce Department reports that new home construction dropped 16.9 percent in January when compared to the previous month. That’s the sharpest month-to-month decrease ever.

There are apartments currently offering a flat-screen TV, two months free rent, and $100 off per month.  With apartment vacancies becoming more common around town, apartment owners are offering better and better incentives. But if you have a single family home for rent in good condition in a good neighborhood, you can still fill that up as people who have been forced out of their homes are not thinking about renting apartments.  If you were forced to move out of your house, and you looked in the newspaper right now, would you look under apartments for rent or houses for rent?  The answer is simple.  In addition, in many cases, you can convert that renter into a tenant-buyer, over time because they used to own a home and now have poor credit.  If you offer them a chance to own your property with seller financing, in many cases they are going to do it.  There is not a better tenant on the planet than a tenant-buyer.  They are never late on the rent, they don’t call you when something breaks, they care for the yard and eliminate the need for property management.

The national apartment rental vacancy is at 10.1 percent, up from 9.6 percent one year ago.  And as real estate values continue to dip, homeowners are finding themselves upside down with their mortgage, forcing banks to foreclose and leaving people without their own home, but they still want to live in one.

Passing Detroit as number one wasn’t easy.  The Motor City has seen a heavy decline due to the ailing automotive industry.  But the appeal of Vegas will never die and people should be careful in comparing Las Vegas real estate to Detroit.

In the short run, Las Vegas is going to suffer a little bit just like everyone else. But people are still moving here. December saw an increase in population of 4863. Detroit, nor any other city in the country can make that claim.   And while those numbers are down slightly for Las Vegas, they still are much higher than anywhere else. The demographic trend is still to the southwest, and who can beat weather? Boston is reporting a high of 33 degrees Fahrenheit today with snow possible for Sunday. It will be windy and 65 today in Las Vegas and 70 on Sunday.

Your vacant rental house only has to be more attractive to live in than those apartments and other houses you are competing against. This is a large part of the reason why location is so important. Many investors don’t understand the neighborhoods to buy their rentals in and this can make a significant difference.

If you are even considering investing in Las Vegas real estate, I urge you to contact me.  www.CapeCodAREI.com/contact Let me show you why you should.

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