Current Update on the LV Real Estate Market -- Part II (Las Vegas: bankruptcy, subdivision)
Please register to participate in our discussions with 1.5 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I have been reading the posts regarding trends in house costs and am entertained by the differing opinions and general lack of scientific data. Regarding sales volume, if you look back at graphs of sales volume you will note that volumes generally peaked in the month of May every year in the last 4 years. The sales volume follows predictable annual variation with minimum activity from August through March.
As far as housing prices are concerned in Las Vegas, it is simply a matter of supply and demand.As the supply will likely outstrip demand after the spring buying season is over, the prices will likely drop; unless you have general economic recovery in the US (not happening) or large economic recovery in las vegas business & employment (possibly, but not likely).Therefore, most observers see the fundamentals of this marketplace not supporting a housing recovery anytime soon.
In many areas in Las Vegas, if you drive down a residential street there are a few for sale signs and double the number of vacant houses which haven't yet been foreclosed on or reached a sales position. Not good for the future, (big supply)
I keep reading this forum to see what other peoples analysis of the market might be, but see little fact and a lot of anecdotal evidence of their housing views. Please provide more complete stats compared to historic fundamentals.
I have lived through a market drop of 50% in two months, with housing prices not reaching this level again for 25 years. I don't expect Las Vegas to recover this slowly but it can happen.
Should you buy vs. when you buy is a different discussion and opportunity cost changes the equation for individuals. Real estate is different from many markets due to natural stickiness of buyers/sellers (ie: the relative illiquidity of the assets). That's why the market is unlikely to truly turn without some strong and readily observable reasons and why fundamentals can diverge significantly from their theoretical values.
When does the market start to correctly value the fundamentals? That's the real question. You can argue we have found some stability, at this point, with many repos clearing and the worst of the credit crisis being over. But more and potentially worse looms (along with other headwinds), and anyone arguing the market has bottomed or turned is implicitly making a call on those risks or has a theory on local conditions trumping the macro.
I view Vegas largely as a "leveraged play" on the national market and, as such, might expect it to lead the larger market. However, I DO NOT expect the Vegas market has turned to lead out while the general economic conditions are still worsening.
So you are going to buy when you think you can flip the house in a couple of years, but that was never my claim in what I wrote.
As I said in my previous post, folks are buying now because they are renting the homes. They are determining the ROI is good enough to go ahead and purchase and they plan to keep the house as a long term investment. AND they will make more money for the next couple of years with rentals instead of treasuries or CDS. I know I am, well above it.
I have been reading the posts regarding trends in house costs and am entertained by the differing opinions and general lack of scientific data. Regarding sales volume, if you look back at graphs of sales volume you will note that volumes generally peaked in the month of May every year in the last 4 years. The sales volume follows predictable annual variation with minimum activity from August through March.
As far as housing prices are concerned in Las Vegas, it is simply a matter of supply and demand.As the supply will likely outstrip demand after the spring buying season is over, the prices will likely drop; unless you have general economic recovery in the US (not happening) or large economic recovery in las vegas business & employment (possibly, but not likely).Therefore, most observers see the fundamentals of this marketplace not supporting a housing recovery anytime soon.
In many areas in Las Vegas, if you drive down a residential street there are a few for sale signs and double the number of vacant houses which haven't yet been foreclosed on or reached a sales position. Not good for the future, (big supply)
I keep reading this forum to see what other peoples analysis of the market might be, but see little fact and a lot of anecdotal evidence of their housing views. Please provide more complete stats compared to historic fundamentals.
I have lived through a market drop of 50% in two months, with housing prices not reaching this level again for 25 years. I don't expect Las Vegas to recover this slowly but it can happen.
Ok, go away now, take all of your 500 dollars and find the info that you want so badly.
I have been reading the posts regarding trends in house costs and am entertained by the differing opinions and general lack of scientific data. Regarding sales volume, if you look back at graphs of sales volume you will note that volumes generally peaked in the month of May every year in the last 4 years. The sales volume follows predictable annual variation with minimum activity from August through March.
As far as housing prices are concerned in Las Vegas, it is simply a matter of supply and demand.As the supply will likely outstrip demand after the spring buying season is over, the prices will likely drop; unless you have general economic recovery in the US (not happening) or large economic recovery in las vegas business & employment (possibly, but not likely).Therefore, most observers see the fundamentals of this marketplace not supporting a housing recovery anytime soon.
In many areas in Las Vegas, if you drive down a residential street there are a few for sale signs and double the number of vacant houses which haven't yet been foreclosed on or reached a sales position. Not good for the future, (big supply)
I keep reading this forum to see what other peoples analysis of the market might be, but see little fact and a lot of anecdotal evidence of their housing views. Please provide more complete stats compared to historic fundamentals.
I have lived through a market drop of 50% in two months, with housing prices not reaching this level again for 25 years. I don't expect Las Vegas to recover this slowly but it can happen.
Nope. Not in Las Vegas. The pattern for the last years on SFR sales has been to reach a plateau in March which holds through August. Than drops off to a low in December/January. See...
I have been reading the posts regarding trends in house costs and am entertained by the differing opinions and general lack of scientific data.
I'm entertained by your pomposity.
Quote:
Originally Posted by homeinvestor
In many areas in Las Vegas, if you drive down a residential street there are a few for sale signs and double the number of vacant houses which haven't yet been foreclosed on or reached a sales position. Not good for the future, (big supply)
Boy that's scientific, looks just like that anecdotal evidence you speak of below.
Quote:
Originally Posted by homeinvestor
I keep reading this forum to see what other peoples analysis of the market might be, but see little fact and a lot of anecdotal evidence of their housing views. Please provide more complete stats compared to historic fundamentals.
They're still keeping all the commission in-house. The point is they're denying the seller a true market price. And it's happening all over Vegas.
Quote:
Originally Posted by olecapt
Wasn't dual. Was in the same office. No connection between the agents except same office. Listing agent is the brokerage recruiter. Used the deal as a sales pitch to come with them. Know a bit about the system used. So the bank approved the immediate offer. Weird. Had to be priced off a BPO. No way it would appraise for anything under 700K.
They're still keeping all the commission in-house. The point is they're denying the seller a true market price. And it's happening all over Vegas.
Nope. Hell half my main competitors are in my office. We all have very high percentages...so the brokerage makes little on an in house deal. I don't think the brokerage could really care. dI would more expect they are favoring selected clients.
So you are going to buy when you think you can flip the house in a couple of years, but that was never my claim in what I wrote.
As I said in my previous post, folks are buying now because they are renting the homes. They are determining the ROI is good enough to go ahead and purchase and they plan to keep the house as a long term investment. AND they will make more money for the next couple of years with rentals instead of treasuries or CDS. I know I am, well above it.
No, I said nothing about buying to flip. I'd be buying as a primary residence. The ROI, as you hit on, is precisely what would be the determining factor. When the net "cost" adjusted for downside risk is less than my alternatives to rent, then it would make sense to buy. That's what could delay my purchase. But, as I said, I'm not passing on something I want just because it may potentially go down 10% or so.
No, I said nothing about buying to flip. I'd be buying as a primary residence. The ROI, as you hit on, is precisely what would be the determining factor. When the net "cost" adjusted for downside risk is less than my alternatives to rent, then it would make sense to buy. That's what could delay my purchase. But, as I said, I'm not passing on something I want just because it may potentially go down 10% or so.
And this gets to be a very interesting discussion.
When one works "ROI" as a major factor in selecting a primary residence it gets very complicated.
It can be done. One simply limits the selection field to those homes with a price far below the likely stable price for the neighborhood. Basically these tend to be REPOs in areas not largely effected by Foreclosures. What you want is a home that is wildly less than the going rate in the neighborhood. Then you simply hold still and wait until the REPO thing burns out. At that point you are ahead some very large amount.
The rub of course is that it is unlikely that you can buy the house that best suits your needs and budget. You must give the economic strong weight. You end up with a good economic decision that may badly effect your quality of life.
It may not be an issue. If you are choosing between a set of relatively comparable homes and one has a large economic advantage due to REPO...buy the REPO...quick.
But in other cases the great economic and the quality of life don't align. I suggest going with the quality of life. Life is too short to make such decision on economic grounds. Misery ends after a while. But its tail colors life for years.
And this gets to be a very interesting discussion.
When one works "ROI" as a major factor in selecting a primary residence it gets very complicated.
It can be done. One simply limits the selection field to those homes with a price far below the likely stable price for the neighborhood. Basically these tend to be REPOs in areas not largely effected by Foreclosures. What you want is a home that is wildly less than the going rate in the neighborhood. Then you simply hold still and wait until the REPO thing burns out. At that point you are ahead some very large amount.
The rub of course is that it is unlikely that you can buy the house that best suits your needs and budget. You must give the economic strong weight. You end up with a good economic decision that may badly effect your quality of life.
It may not be an issue. If you are choosing between a set of relatively comparable homes and one has a large economic advantage due to REPO...buy the REPO...quick.
But in other cases the great economic and the quality of life don't align. I suggest going with the quality of life. Life is too short to make such decision on economic grounds. Misery ends after a while. But its tail colors life for years.
Agreed. I threw ROI in there a bit liberally as it applies to my purchase decision. I'm not necessarily looking to maximize ROI, but rather minimize cost, if that makes sense. I have a pretty inelastic demand curve, at this point. but I could add or subtract 6 months to my planned purchase date based on not trying to time the bottom, but buying on a dip. I do value quality of living and so ROI would not be the sole criteria (rather, maximizing utility is). But if I'm not excited to buy something, I have no problem waiting a few months or more for a better deal. Basically, I'm much less concerned about ROI than buying what I perceive as good "value". But until the market bottoms, equivalent rent is too high of a benchmark.
Please register to post and access all features of our very popular forum. It is free and quick. Over $53,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 1.5 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
