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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UPDATE – M Resort, Las Vegas

A couple of days ago I wrote about the new jobs being created in Las Vegas. (https://capecodarei.wordpress.com/2009/03/02/job-creation-is-happening-in-las-vegas/)  My good friend visited the M resort last night with another friend of his for dinner. They went to Veloce Cibo, which the web site claims ‘the food may leave you speechless’. The LACK of food had them anything but speechless. They were sat more than 30 minutes after their reservation time, and within an hour of sitting down, they had only received their appetizer. They complained 3 times to management and there were empty tables in the restaurant. My guess is that the M resort is still hiring, or at least I hope they are so they can have the right personell to handle their customers. 

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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They finally recognize that we are part of the solution.

They finally figured out that we are not the enemy. For more than a year real estate investors have been called very nasty names, been blamed for the housing market and been generally dismissed as ‘the problem’. There is no doubt that speculators contributed to the current state of the economy. But in most cases, we were just trying to capitalize on certain opportunities. I think that is what makes this country great. And the truth is, investors, if given the opportunity, will help the housing market settle down and turn around. Why, because we will buy.

So, last week, FNMA announced on their website that the 4 loan limit has been removed, and, under favorable circumstances, they will allow an investor to have up to 10 loans. This is great news for investors who are picking up foreclosures and other distressed properties and keeping them for rental or selling on lease-options.

You can get all of the details at FNMA’s website by clicking here.

What does this mean? Well, certainly it is not an end to the credit crunch, however, if you have some cash and good credit, you can own more properties and ensure your ability to prosper when all of the dust settles. Let’s face it, people have to live somewhere, and someone needs to provide that housing. Now please let me remind you. Being a landlord is not rocket science, but you should take some time (and probably some money) to learn how to be an effective landlord, so that your tenants help make you wealthy instead of miserable. I’m actually in the process of getting ready to write a home study course for landlording – but it will be awhile before it is finished. Come to think of it, I have to finish my negotiating course first.

Are you ready to buy more now? Are you interested in Las Vegas real estate? (You should be.) Drop me a line and let’s see what we can find you. Visit me at http://www.MyFastEasySale.com

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Who is getting mortgages in Las Vegas these days?

The candid truth about who can get a mortgage for Las Vegas real estate, and some things you may not know.

I have a friend who works as a loan officer for a pretty big mortgage lender in Las Vegas. He called me today to ask me what I wanted for my birthday (yes, today is my 41st).  I answered “dinner with Jennifer Anniston”.  Then I said, “As long as we’re being honest, tell me what is happening in the mortgage industry. Who is getting loans right now?”

Here is what he said – 

“The optimal person who is getting a loan right now is a person who does not own a house, (then he added) of course you know, everything is full doc1. There is not one stated income2 program around. If someone is calling a program ‘stated’, they’re lying. FHA loans have gone from 5% of our total pipeline3 to 50% of our total pipeline over the last year. A lot of buyers are going to FHA [loans] even though they have great credit scores or whatever, just because they are easier to close than conventional loans and you only need to have 3 1/2% down. If you have 20% down on a conventional loan, they’re lending on that; 25% down on investor properties, is going to be your best rate. We’re still lending a lot. I just did my pipeline report. I’ve got 5.5 million dollars in my pipe that is set to close before February. The sales manager that I work with, his pipeline is at 3.8 million dollars; so there are loans out there. There are definitely loans out there.”

Then he said

“If you own property right now, and you are upside down in it, and you want to buy another house, you have to be able to qualify [with proof of income] for both payments without using rental income from the one you are leaving.” [this is because people who are not behind yet, were buying a new homes, then ‘bailing’ on the one that they were upside down on. It did not take lenders long to get wise to this buy-n-bail scam]

Finally he said

“The other thing to be aware of the at the beginning of this year, the FHA loan limits in our market [Las Vegas] got changed to a maximum of $287,500 which is a purchase price of $295,000.  Conventional loans in Las Vegas are very difficult to get. The mortgage insurance companies don’t want to issue policies. So now you have a gap between the conventional loan limit, which is $417,000, which dramatically decreases the number of borrowers who can qualify. In [his] personal opinion over the next year, [he] think you’re going to see values of homes in that zone [between $295,000 and $417,000] degrade into an FHA loan. If you are going to list your house for $310,000, why wouldn’t you drop the price to $295,000, so you have a bigger pool of potential buyers. If you don’t, you’ll have fewer offers, and if you do get an offer and the buyer ‘falls out’ because they can’t get conventional financing, you may go ahead and drop the price to $295,000 so that you can sell it.”

That’s what he said, and he’s on the front lines of the Las Vegas mortage industry every day and has been for a few years.

1 – Full doc: Short for full documentation – in other words, prove you have money, prove you make money, and prove that it is all legitimate.

2 – Stated or Stated income: When people with excellent credit history are allowed to just state how much they earn

3 – Pipeline: Loans that are in process that are likely to be approved for funding

Are you ready to buy real estate in Las Vegas?  Visit www.MyFastEasySale.com, click the “Wholesale Buyers” link, and fill out the form.  Let’s get you going.

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