[dude66]

This graph tells you all you need to know about housing and its upcoming effects on our economy. 2008 is going to be one ugly year (and March will be horrendous).

[olecapt]

Well September numbers are pretty much done. Sales continue to head toward zero. Looks pretty clear that Single Family Sales in Las Vegas are below 1000 in September. Which is certainly lower than any other month since the millennium happened. I have no idea how long ago we failed to sell a thousand homes.

Overall prices are down about 5% on the year. The better homes (selling above $225 per SF) are actually increasing in price. The sales however of such homes are 1/3 what they were in the first quarter. So you get a better price for a home you can't sell.

So no break in price and sales dropping probably close to as low as they can get. I am skeptical that much of this is actually driven by the mortgage and availability. The problem is that the buyers have shut down... not that they can't finance.

[dude66]

Originally Posted by olecapt

The problem is that the buyers have shut down... not that they can't finance.

Then what shut them down, if not the credit/financing crunch? Seems to me the timing is right -- sales fell at the same time people are having trouble qualifying for loans.

[olecapt]

Originally Posted by dude66

Then what shut them down, if not the credit/financing crunch? Seems to me the timing is right -- sales fell at the same time people are having trouble qualifying for loans.

Nope...sales starting falling a long time ago. Way before any of the mortgage problems. And they have continued to fall at roughly the same rate. I thought for a bit that the August blowup had actually effected price but it does not appear to be the case. The drop in apparent price was due to very weak sales in high quality housing.

That might be attributable to the mortgage thing. There has been a sharp downturn in the sale of homes costing more than 225 per sf. These are almost all jumbo loans. So perhaps the mortgage thing is impacting the jumbo part of the market. But that is under 10% of the overall.

[ackackack]

Originally Posted by olecapt

Nope...sales starting falling a long time ago. Way before any of the mortgage problems. And they have continued to fall at roughly the same rate. I thought for a bit that the August blowup had actually effected price but it does not appear to be the case. The drop in apparent price was due to very weak sales in high quality housing.

That might be attributable to the mortgage thing. There has been a sharp downturn in the sale of homes costing more than 225 per sf. These are almost all jumbo loans. So perhaps the mortgage thing is impacting the jumbo part of the market. But that is under 10% of the overall.

Could it have something to do with the fact that home pricing has greatly outpaced earnings in this valley, and/or investors don't want that second Vegas home anymore and aren't looking, and/or we built too many to begin with, and/or people in general don't have two nickels to rub together anymore.
Would the rise in meidan price have anything to do with the high end condo market?
What about a few multi-million dollar sales throwing the stats off a bit? Although I'm not in real estate, I have yet to hear a case where someone has raised their asking price after it sitting on the market for months because the median price went up. Without out of town money coming in, I don't see how any home will sell, especially to first-time buyers earning typical wages in this town with typical debts. How any family can save enough to put down towards a $200,000+ home, then manage the monthly mortgage payments+ is beyond me. I don't know why they would, knowing that it will likely depreciate faster than they will be able to build equity. It looks like those with money (typically baby-boomers) will be the one's who get to ride this out on top, leaving the scraps for their kids. But what else is new?

[olecapt]

Originally Posted by ackackack

Could it have something to do with the fact that home pricing has greatly outpaced earnings in this valley, and/or investors don't want that second Vegas home anymore and aren't looking, and/or we built too many to begin with, and/or people in general don't have two nickels to rub together anymore.
Would the rise in meidan price have anything to do with the high end condo market?
What about a few multi-million dollar sales throwing the stats off a bit? Although I'm not in real estate, I have yet to hear a case where someone has raised their asking price after it sitting on the market for months because the median price went up. Without out of town money coming in, I don't see how any home will sell, especially to first-time buyers earning typical wages in this town with typical debts. How any family can save enough to put down towards a $200,000+ home, then manage the monthly mortgage payments+ is beyond me. I don't know why they would, knowing that it will likely depreciate faster than they will be able to build equity. It looks like those with money (typically baby-boomers) will be the one's who get to ride this out on top, leaving the scraps for their kids. But what else is new?

It is certainly true that a high price to income ratio could slow a market. I am sure there is some of that in the equation. Then again if it was a critical factor all of CA and much of the higher priced east would have shut down long ago. Speculators/investors certainly played a role in the big years. They are basically gone now and have been for a while. The Las Vegas market is selling at rates well below those one would expect for a normal community of its size. We are not off a "great market" standard. We fail to even make a "poor market" standard.

There are no condos in any of this data. Only single family homes that have sold. I don't use the overall sales data because of the weird things that go on with condos. I also believe the high rise strip condos are a different market and should not be confused with the local RE Market.

Raising of the price of an unsold house happened a good bit from 2004 to 2006. Some homes went up three or four times before they sold. You will not find it happening at the moment I am sure.

Virtually any two wage earner household can afford a 200K house. Many single wage earners can as well. There is little question that they can buy...it is that they are choosing not to at the moment. I believe the present numbers are that roughly half the population can afford the median priced home. That is as opposed to less than 10% in much of CA and NYC area.

The area with the rising price was the expensive homes. And that is really hard to figure. The sales are headed toward very low levels and the price of the homes that sell increase. Makes no sense by any rationale I know of.

[VegasResident]

LOL. I think what someone said the other week is a good statement about Vegas:

Sellers need to get more realistic in their pricing and buyers need to stop thinking they are going to get 30% price reductions.

Once these two meet, the market will stabilize and return to normal.

[ackackack]

This article is a joke; it comes off more like an infomercial. There was one part that I found troubling:

"Local real estate consultant John Restrepo said home prices are only half the story on affordability.
"The other half is income," he said. "When you look at price vs. income, we're not an affordable community."
A report from housing analyst John Burns shows the proportion of housing cost-to-income in Las Vegas at 50 percent, compared with 99 percent in Los Angeles (Beverly Hills) and 24 percent in Killeen, Texas."

Is the author really continuing to debunk Ed Leamer? The RJ once again proving why they aren't worth the paper their printed on. I can't find where it says "paid advertisement," or does the RJ really think we are as stupid as Morgan Quitno says we are?

Vegasresident, that's great that you were able to put down 20% on a $300,000 home. How many familes in this valley, earning typical Las Vegas Service Industry wages can afford to save $60,000? Nevermind that, if they use a first time home-buyer type loan and put down less, how many can afford the approx. $2,000/month payments? The housing cost-to-income is 50% percent here? I couldn't live if half of my income was expected to go to my mortgage, nor would I want to considering that it will likely continue to depreciate faster than I can pay it down.

[ackackack]

ReviewJournal.com - Business - Sad September for sales

Not surprising September results were awful. Also not surprising is the way the RJ allows Hubble Smith to spin it. Some of my favorite quotes from the article:

"If a seller will sell at a price and a buyer will buy, so be it. Value is determined by what the seller is asking and what the buyer is paying. With 5,000 people coming a month, maybe we're undervalued."
"Real estate, like politics, is local," she said. "People looking for a home in Las Vegas don't need to worry about what coastal property in Florida is selling for. They're reading too much into national news.

Wow, the article mentions that there is a 22 month supply and that we may be undervalued? All that was missing was the part about this being a buyers market. Only 990 homes and 213 condos sold. This sucks.

[bull136]

Originally Posted by olecapt

I had not seen that yet...but here it is....

ReviewJournal.com - Business - LV homes relatively affordable, data find

I expect Hubble Smith will be writing up doom tommorrow as the September numbers are out....

There you are . Yes i moved to raleigh Nc where i bought a beautiful home 2300sqft for $186k in 3 months now worth 205k. And when we last spoke you where talking about the market stabilizing and imsaid it would drop alot i must tell you i was correct and you where 100% wrong . Houses in summerlin near palo verde high where down to around 300k when I left in june/07 from 320 to 340 in Aug/06. When we moved to vegas thank god i did not listen to any of you foolish realitors . I am coming out there next week to look at several homes for 240k to 260k identical as the ones i was looking at for 300k in june........ any comments of course not......... I am going to look at a beautiful home 1700sqft 255 k the same as my old neighbor. same house ,same condition , same neighborhood , but they paid 370 because they listened to there realtor instead of me I told them to rent for 6 months. They would be buying at the top of a 5 year run up and prices will be dropping alot and fast. I have spoke to them and of course they are very upset with them selves that they did not listen to me........All the comp houses in there area are listed for 260k to 280k. They may have to move and sell and there house is only worth around 280 at most they do not no what to do........ Nothing like overpaying for a house 100k thanks to realitors like you............the house i was renting my landlord paid 329k i am buying the identical house for 225k it is accually nicer............ it's good to be correct I am patting myself on the back as I am typing this. They may even go down more but this is a good point to start low balling people and in 3 or 4 years when they hit a high again i will dump. Buy Low sell high its simple. .......anyone want any advice on real estate from NOT a REALITOR please ask before you buy and maybe just maybe my 18 years experience as a smart investor ( who always buys high and sells low)can save you a few thousand.Also Please anyone in the stock market get out now before all the institutional investors( mutual funds) start profit taking or all the profits you made in the past 6 - 12 months will vanish. The market will drop and hard it road from 10500 to 14000 in a year. And as in real estate if you ask a broker they will say stay in or buy more ..........do not be foolish what goes up must and always does go down............as we now see in real estate. In 6 months when the dow hits 12000 we will see who is smart to sell high and was mislead by others who always have hidden agenda's.......