Las Vegas Real Estate Blog

Las Vegas is selling single family homes a little faster than we did in July. The number of contingent SFR contracts stands at 3809; the number in pending is 2630.

What is pending vis-a-vis contingent? Given the odd contract scenarios foisted upon innocent buyers by the investor-sellers, there is no difference in this context. Both mean a property is in contract and is rolling the dice, trying to pass “Sold” to collect $200.

Never before have I had a seller respond to my offer with an un-executed (no signatures at all) counteroffer that I am supposed to have my clients sign and send back to the seller so the seller can decide if they still like what they wrote. Ridiculous. But, that is what is happening, so if you want to buy or need to buy, just be very patient. Things are a little different in the land of Oz.

And, the rising number of single family homes in contract is the fuel for this fire.
Also, my watch on affordability shows that single family listings in the watch area (all of the valley but 101,201, and 202) shows the number of listings at or below $150/sq ft (5092) have fallen slightly and the total number of listings in the same ML areas (14509) are each about 200 units below what they were on August first. Fewer listings, not as many below $150/ft.

We’ll see what the monthly totals bring but it looks like August “total single family closings” will rival or exceed July. The big news might be that with Pending and Contingent sales remaining so strong, we might match the sales totals set in 04 and 05 in September and remain higher than 04-05 for the rest of the year.

BULK SALES of REO’s – and other myths:

I have been checking into this very seriously and have learned from bank corporate property managers and brokers that, so far in Las Vegas, this isn’t happening. There are rumors of it happening, but a source at Wachovia said that, though they were considering a mini-bulk sale agreement on 100 REO homes over the coming year where-in the buyer had yet to qualify by showing them the money, they had no need to do this and knew of no other banks that were.

If it happens it will dry up REO’s fast so that prices can rise. Yeah.

But, most of my sources have said that since the banks can sell all the REO’s they bring to market at market price within 80 days of taking possession in the foreclosure, they don’t need to give away money. Las Vegas closed 3000 single family homes in July – here we just track MLS.
So, if you want to buy one hundred homes (30 MIL) or four hundred homes (100 MIL), to the market, the larger figure is just an extra 13% that the banks will collect next month anyway without you. Why give a big cash buyer 70% off when they can sell to 400 cash buyers for 3% off. That’s right. Most of the REO sales are cash.

Either way, the end will be the same. Foreclosures will slow down. The inventory will be absorbed. And prices will rise, as has already begun.

Live long and prosper.

Contrary to what the local doom and gloom media reported yesterday, Las Vegas home prices didn’t “plunge” 28.4% in May.  Can someone please help their writers get this right?  On three accounts (that I see…though there are bound to be far more) they blatantly distorted the facts to appear far worse than the numbers truly report.  Local news station KTNV channel 13 reports on their site that “The largest decline was in Las Vegas where home prices in May plunged 28.4%.”  This nonsense was even repeated on their news broadcast.  A sleazy penny stock spammer couldn’t twist a story as much as these bozo’s.  What a joke.  Please help put a stop to this sensationalistic bs.  Here are the real facts, as reported by Case-Schiller for ‘year over year’ analysis.  View the News Misreporting Las Vegas Real Estate Price Changes. or  Watch the video report.  UPDATE: Las Vegas Fox 5 MisReporting of the Las Vegas Real Estate Market.

Housing Price Indices

Housing Price Change "Year over Year"

If you haven’t yet been over to The Frothing Developer’s website, www.frothingdeveloper.com, then you’re missing a wonderful angle & unique viewpoint on the Las Vegas real estate market. Alex Edelstein, CEO of Gemstone Development refutes, debunks, and demystifies what the national and local press have to say about the Las Vegas real estate market. Recently, Alex was featured on Fox news speaking about the Las Vegas real estate market, how he feels about the current state of affairs, the future of Las Vegas real estate, and how it stands up to markets such as Miami and Detroit.

Gemstone Development CEO, Alex Edelstein discusses Las Vegas real estate, the Las Vegas economy, and the Frothing Developer blog, on Fox Business News, July 1, 2008.

httpv://www.youtube.com/watch?v=rSm978jfYGE

Las Vegas pending single family sales were at 2234 on May first (we officially closed 1794 units for April – the preceding 30 days), 2542 on June first (we officially closed 2026 for May) and we have 2591 pending sales today (we unofficially closed 2116 units in June).

If that holds up, not only has each month in 2008 seen more closings than the month before, and we are still better than 2007 for the third month in a row and pulling away, but also it would be the first time since 2005 that June saw more closings than May.

Also, with pendings strong, IF we close 2100 Single Family deals in July we will be ahead of 2006. That would put us in striking distance of the slow months (October thru January) during the “Boom” of 2004 and 2005 when single family closing numbers ranged between 1985 (in Jan of 05) and 2604 (Oct of 2004).

That may not happen if 2008 tails off in the fall as most years do. Or, it could happen, since we have many more people in Las Vegas who haven’t bought anything in 3 years, we should be doing numbers comparable to those given the growth, and the banks are feeding excess foreclosures slowly into the market, so I hear, and FHA transactions are up 2000% since January 2008 (so I heard last Friday from Jeremy Dougherty, area VP with Countrywide).

What I think the official GLVAR numbers show is that Las Vegas closing numbers below 1000 per month (October 2007 thru Jan 2008) represent the bottom as far as demand is concerned.

We are building sales with one arm tied behind our backs, namely, the average guy is still not fully back in the game – FHA makes you declare your tips, and some people don’t want to yet.

When the new president announces that he is here to save the economy and Congress decides they need to save their jobs, Las Vegas will run short of houses in 2010.

Buy Low, Sell High.

Check out the information about the Las Vegas real estate market provided by SalesTraq. Existing home sales showing strong increase. New home sales still on the wane.  Read a more in depth article at the Las Vegas Review Journal.  Resales pass 2,600 units for first month since March ‘07; new-home sales stall

Doom and gloom surrounds the local and national real estate headlines, but pending and contingent sales figures have seen a dramatic increase (as noted in other posts). Similarly, high-end luxury homes in Las Vegas have not seen a decline in value, but rather a dramatic increase. Ultra high-end luxury homes are considered homes with a sales value over $1.5 million. Buyers above that mark seem not to be affected by the tightening of credit in the Jumbo mortgage loan market.

Interestingly, the market between $700,000 to $1.5 million (or around the $1 million range) will probably face yet more declination of value. Steve Hawks is anticipating what he has called a “million dollar massacre”, as Jumbo mortgages for these borrowers are tough to qualify for, hard to fund, and surrounded by a shadow of FBI investigation due to mortgage fraud. With a lack of qualified borrowers and increased scrutiny, these properties may see values continue to drop.

Read more on this subject, an interview with Steve Hawks, and insight into other aspects of the current Las Vegas Real Estate market at the Review Journal.

Prices increase in high-end housing market while sales stay steady

Our good friend and Title Professional Linzy Turner with Old Republic Title Company provides the latest housing sales reports for Las Vegas single family residences, as well as Condo’s and Townhomes. There are articles throughout the “blogosphere” that have made attempts at interpreting these figures, but we will leave that interpretation up to you. However, I would like to point out that there are severe discrepancies throughout different Clark county zip codes located throughout areas of the valley. Take particular note that some areas of the valley showed an increase in value. The Clark county Single Family Residence report is available for you here as an image. 2 pdf available files for download are the sales and values reports for Condo’s and Townhomes. (Intro. by Admin.)

You may right-click on any of these items and choose “Save target as…” to download directly to your desktop or separate folder.
Clark County May 2008 Single Family Residence Sales Activity

May 2008 Condo Sales Activity.pdf

May 2008 Townhouse Sales Activity.pdf