Current Update on the LV Real Estate Market -- Part II (Las Vegas: to eat, housing market)
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Different methodologies. Actually the Case-Shiller Vegas and Phoenix numbers are relatively good news. They indicate that those locales are at the CS bottom and will likely trend upward shortly. Maybe a year to a yoy increase....could be less if the REPO supply is slowed by the Feds or simply running out of subprimes.
Given what I've seen, this may turn out to be fairly accurate. I'm bringing back this thread since I think we are finally nearing the bottom and the thread should serve as an interesting historical narrative of the now infamous housing bubble/bust of the early 21st century. Also an update on my (hopefully now successfull) upgrade that started Thanksgiving of last year.
Listed Summerin 1,700 square footer 11/08 for unrealistic high amount of $249,000 to at least get it listed and monitor the overall meltdown going on at the time. Lowered the price to $239,000 just to keep pace with the decline but still being fairly unreaslistic. Got an offer in early 3/09 for $225,000. Inspection found K-tech pipe fittings and had to give up $5,000 in closing costs. Then house appraised for $215,000 (128/foot) and lost another $10,000 in the deal. Then the hunt.
Finally several +- 3,000 square footers came on the market for +- $400,000 in the Vistas. Narrowed down to three and fired off offers mid 3/09. Two of the three had just gone into contract including the best deal which was an approved short-sale for $384,000 in Estancia. It was 3,300 square footer with a killer view of the Strip from the loft and large deck. The one that remained was a 3,100 square footer in Pamilla but the Asset Manager was a jerk and took way too long to figure out it was his responsibility to replace stolen appliances. By the time he came back with final offer of $400,000 all new appliances and closing costs, we had moved on to a more affordable gem in The Trails. Went into contract on that 2,400 square footer yesterday for $330,000. Selling point was a killer back yard to include pool, spa, covered patio and mature palm trees. Front landscaping much nicer than anything in the Vistas also.
Anyway it was an interesting journey and I hope I timed it at or near bottom. Definently felt a tightening market there at the end at least in Summerlin and actually offered $1,000 over list to beat out a competing offer.
Given what I've seen, this may turn out to be fairly accurate. I'm bringing back this thread since I think we are finally nearing the bottom and the thread should serve as an interesting historical narrative of the now infamous housing bubble/bust of the early 21st century. Also an update on my (hopefully now successfull) upgrade that started Thanksgiving of last year.
Listed Summerin 1,700 square footer 11/08 for unrealistic high amount of $249,000 to at least get it listed and monitor the overall meltdown going on at the time. Lowered the price to $239,000 just to keep pace with the decline but still being fairly unreaslistic. Got an offer in early 3/09 for $225,000. Inspection found K-tech pipe fittings and had to give up $5,000 in closing costs. Then house appraised for $215,000 (128/foot) and lost another $10,000 in the deal. Then the hunt.
Finally several +- 3,000 square footers came on the market for +- $400,000 in the Vistas. Narrowed down to three and fired off offers mid 3/09. Two of the three had just gone into contract including the best deal which was an approved short-sale for $384,000 in Estancia. It was 3,300 square footer with a killer view of the Strip from the loft and large deck. The one that remained was a 3,100 square footer in Pamilla but the Asset Manager was a jerk and took way too long to figure out it was his responsibility to replace stolen appliances. By the time he came back with final offer of $400,000 all new appliances and closing costs, we had moved on to a more affordable gem in The Trails. Went into contract on that 2,400 square footer yesterday for $330,000. Selling point was a killer back yard to include pool, spa, covered patio and mature palm trees. Front landscaping much nicer than anything in the Vistas also.
Anyway it was an interesting journey and I hope I timed it at or near bottom. Definently felt a tightening market there at the end at least in Summerlin and actually offered $1,000 over list to beat out a competing offer.
Congratulations dano and much good luck in your new home! That is what I've been seeing in this r/e office where I temped. Counter offer wars, multiple offers and offers above the list price for the homes in the best shape in the nicer areas...
This isn't close to the bottom. There was a slowing of foreclosures as banks waited to see what the Obama plan might bring. Now the spigot is back open and the backlog is getting flushed out. In addition, welcome to ALT-A and "prime" defaults. We've got a long way to go folks. Option ARMs and ALT-A's don't subside till late 2011. Not to mention the economy is terrible with unemployment continuing to increase. We are on the edge of a cliff right now...the banks are insolvent...it's all being propped up like a house of cards. Enjoy the good times now, it's about to get a lot worse. Fannie, Freddie Defaults Rise as Borrowers Cite Lower Income - Bloomberg.com By Dawn Kopecki April 21 (Bloomberg) -- Fannie Mae and Freddie Mac mortgage delinquencies among the most creditworthy homeowners rose 50 percent in a month as borrowers said drops in income or too much debt caused them to fall behind, according to data from federal regulators. The number of so-called prime borrowers at least 60 days behind on mortgages owned or guaranteed by the companies rose to 743,686 in January, from 497,131 in December, and is almost double the total for October, the Federal Housing Finance Agency said in a report to Congress today.
This isn't close to the bottom. There was a slowing of foreclosures as banks waited to see what the Obama plan might bring. Now the spigot is back open and the backlog is getting flushed out. In addition, welcome to ALT-A and "prime" defaults. We've got a long way to go folks. Option ARMs and ALT-A's don't subside till late 2011. Not to mention the economy is terrible with unemployment continuing to increase. We are on the edge of a cliff right now...the banks are insolvent...it's all being propped up like a house of cards. Enjoy the good times now, it's about to get a lot worse. Fannie, Freddie Defaults Rise as Borrowers Cite Lower Income - Bloomberg.com By Dawn Kopecki April 21 (Bloomberg) -- Fannie Mae and Freddie Mac mortgage delinquencies among the most creditworthy homeowners rose 50 percent in a month as borrowers said drops in income or too much debt caused them to fall behind, according to data from federal regulators. The number of so-called prime borrowers at least 60 days behind on mortgages owned or guaranteed by the companies rose to 743,686 in January, from 497,131 in December, and is almost double the total for October, the Federal Housing Finance Agency said in a report to Congress today.
Well maybe. But the inventory of available REOs is at 3781 down from 6500 Jan 1 and dropping at close to 200 per week. We will be down to a month of inventory by June 1...and a good part of that month is unsalable stuff.
So if the banks have cut loose and starting foreclosing in volume the houses are not getting to the MLS. And I doubt very much they would foreclose and then hold.
Prices are still dropping though...an amazing market.
Credit Suisse says $1 Trillion in Alt-A and Option ARM mortages will be resetting in the next 2.5 years. We've seen the worst of the subprime bust but with unemployment headed for double digits, watch the prime defaults grow. The moratorium did exactly what it was intended to do; halt foreclosures while a coherent "rescue" plan was formulated. Once the moratorium passed, NODs spiked to their highest levels ever. That is additional foreclosure inventory that has yet to work its way through the system.
All that said, I'm a buyer at these levels. I like the risk/reward proposition. I won't be drawn into a bidding situation though. I'll make a cash offer and see if it sticks. If not, I'll just wait for the next one.
All that said, I'm a buyer at these levels. I like the risk/reward proposition. I won't be drawn into a bidding situation though. I'll make a cash offer and see if it sticks. If not, I'll just wait for the next one.
That is the only logical way to approach housing at this juncture.
Given what I've seen, this may turn out to be fairly accurate. I'm bringing back this thread since I think we are finally nearing the bottom and the thread should serve as an interesting historical narrative of the now infamous housing bubble/bust of the early 21st century. Also an update on my (hopefully now successfull) upgrade that started Thanksgiving of last year.
Listed Summerin 1,700 square footer 11/08 for unrealistic high amount of $249,000 to at least get it listed and monitor the overall meltdown going on at the time. Lowered the price to $239,000 just to keep pace with the decline but still being fairly unreaslistic. Got an offer in early 3/09 for $225,000. Inspection found K-tech pipe fittings and had to give up $5,000 in closing costs. Then house appraised for $215,000 (128/foot) and lost another $10,000 in the deal. Then the hunt.
Finally several +- 3,000 square footers came on the market for +- $400,000 in the Vistas. Narrowed down to three and fired off offers mid 3/09. Two of the three had just gone into contract including the best deal which was an approved short-sale for $384,000 in Estancia. It was 3,300 square footer with a killer view of the Strip from the loft and large deck. The one that remained was a 3,100 square footer in Pamilla but the Asset Manager was a jerk and took way too long to figure out it was his responsibility to replace stolen appliances. By the time he came back with final offer of $400,000 all new appliances and closing costs, we had moved on to a more affordable gem in The Trails. Went into contract on that 2,400 square footer yesterday for $330,000. Selling point was a killer back yard to include pool, spa, covered patio and mature palm trees. Front landscaping much nicer than anything in the Vistas also.
Anyway it was an interesting journey and I hope I timed it at or near bottom. Definently felt a tightening market there at the end at least in Summerlin and actually offered $1,000 over list to beat out a competing offer.
Party at Dano's. Will bring swim trunks and margaritaville machine..... Congrats Dano... welcome to our world!
Credit Suisse says $1 Trillion in Alt-A and Option ARM mortages will be resetting in the next 2.5 years. We've seen the worst of the subprime bust but with unemployment headed for double digits, watch the prime defaults grow. The moratorium did exactly what it was intended to do; halt foreclosures while a coherent "rescue" plan was formulated. Once the moratorium passed, NODs spiked to their highest levels ever. That is additional foreclosure inventory that has yet to work its way through the system.
All that said, I'm a buyer at these levels. I like the risk/reward proposition. I won't be drawn into a bidding situation though. I'll make a cash offer and see if it sticks. If not, I'll just wait for the next one.
Again RE is local. I think Las Vegas went well south a year before lots of places even stopped going up.
Everything I see indicates Alt A begins slowly late this year. And then builds throughout 2010. That provides all sorts of possible scenarios. The most interesting is what happens over the next few months. Unless that purported slug of REOs proves real and substantial we are still headed to a crunch.
We all however agree that it is a time to buy. What happens though if we all believe that and we hit 3500 SFRs in April and 4000 in May...the pendings continue to indicate strong growth so we are not going to peak in April. How high can it go? What happens if we do run out of REOs?
Again RE is local. I think Las Vegas went well south a year before lots of places even stopped going up.
Everything I see indicates Alt A begins slowly late this year. And then builds throughout 2010. That provides all sorts of possible scenarios. The most interesting is what happens over the next few months. Unless that purported slug of REOs proves real and substantial we are still headed to a crunch.
The March NOD number was enormous. Bigger than any previous month since the bust. What that number ultimately translates into as Vegas REOs remains to be seen. Like a pig going through a python, it's likely to be ugly, and we're not going to see the results for several months.
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We all however agree that it is a time to buy. What happens though if we all believe that and we hit 3500 SFRs in April and 4000 in May...the pendings continue to indicate strong growth so we are not going to peak in April. How high can it go? What happens if we do run out of REOs?
I wasn't able to top tick my exit in the Silicon Valley RE market, and I'm not likely to catch the exact Vegas bottom either. When you can buy for less than rent, or for less than replacment cost, you have to believe you have reached something of a fundamental value. That's not to say prices can't go lower. As has been noted by another poster, both booms and busts routinely overshoot to the upside and downside. I'm a buyer at these levels but I don't plan to chase.
Good article today, while the rest of the country is off to a lackluster spring real estate sales time, the Western states are showing the only sparks of activity (sales up over last year same time frame.) This is pretty much indicative of what is going on in Las Vegas right now......read on and take it for what its worth.
"Sales, while plummeting compared with last year in most of the country, were up by 23 percent in the West from a year ago, without adjusting for seasonal factors. For distressed Western cities, “this is a sharp recovery,” Yun said.
The number of unsold homes on the market at the end of March fell 1.6 percent from a month earlier to 3.7 million. But due to the slumping sales pace, it would still take almost 10 months to rid the market of all of those properties."
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