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By the way. Where is our local real estate expert??? I'm still waiting for the answer as to why prices are going down while the demand is so strong?? It seems he is ducking the question.
In September, a popular form of financing used by first-time home buyers – government-insured FHA loans – accounted for 53.8 percent of all home purchases, up from 52 percent in August. Absentee buyers bought 40.4 percent of all Las Vegas–area homes last month – the highest figure for any month this decade. Absentee buyers are often investors, but could include second-home buyers and others who, for various reasons, indicate at the time of sale that the property tax bill will be sent to a different address.
Think about that for a second: investors probably account for more purchases in Vegas than at the height of the bubble. Combined, these 2 forms of purchase account for 94% of all purchases in the "recovering" Vegas market. Who was saying that the 1st time buyer with their $8K credit wasn't a factor in Vegas housing "recovering" market??
Next, 5014 homes were closed in September and 68.4% were foreclosures sales. So 3429 foreclosure homes left the market but 3162 were NEWLY foreclosed on. Pile on some more phantom inventory. 3162 NEW foreclosures in a month does not seem like a deflated bubble especially is they are coming in from higher value homes. Once the tax credits end, I predict you will hear some more deflating.
The bubble is over??? Don't put away your pom-poms yet; we need some more cheerleader to find some buyers.
You might want to consider quoting some of the other interesting stats in the link rather than putting out only the doom and gloom. eg, foreclosure rates are 15% below the peak in Feb. SFR sales is highest in 3 years and has been going up for 18 months already. This is the 1st time sep sales has gone up from Aug since 1994 etc.
No one is arguing that the $8k isn't helping but its not the only factor in play. As to the 1/3 figure that was quoted before, that was a recent lvrj article quoting the stats for a 1yr period.
Definitely as the numbers extend to the Nov 09 deadline, the % of FTHBs can be expected to ramp up. Wait for the Oct sales numbers.
Nevertheless, I would agree that FTHB are focussed very much on the lower end of the market. That can explain why the sales median price have dropped that drastically.
The key is that foreclosure sales are out-pacing foreclosures (barely and whether be it due to investors or FTHB) and consequently inventories are going down. Its been 2 years of continued foreclosures at the pace stated and that's tightening up cos that pace cannot possibly be sustained forever.
You might want to consider quoting some of the other interesting stats in the link rather than putting out only the doom and gloom. eg, foreclosure rates are 15% below the peak in Feb. SFR sales is highest in 3 years and has been going up for 18 months already. This is the 1st time sep sales has gone up from Aug since 1994 etc.
No one is arguing that the $8k isn't helping but its not the only factor in play. As to the 1/3 figure that was quoted before, that was a recent lvrj article quoting the stats for a 1yr period.
Definitely as the numbers extend to the Nov 09 deadline, the % of FTHBs can be expected to ramp up. Wait for the Oct sales numbers.
Nevertheless, I would agree that FTHB are focussed very much on the lower end of the market. That can explain why the sales median price have dropped that drastically.
The key is that foreclosure sales are out-pacing foreclosures (barely and whether be it due to investors or FTHB) and consequently inventories are going down. Its been 2 years of continued foreclosures at the pace stated and that's tightening up cos that pace cannot possibly be sustained forever.
I posted the link and suggested people read the unbiased article. It contains all of the data. People should read it and determine their own conclusions.
My posted words were specifically chosen to highlight the fact the cheer-leading terms are not warranted; some here suggest that the "bubble's over" or that "multiple bids" prove we are in an incline etc. So yes, thankfully there are some good pieces of info in that report.
Generally speaking, the multiple bids are for the low cost homes that have 3% down government backed loans that get the $8K back in return (a.k.a. getting your down payment back. When I point to the fact that spendy homes have more to go, that is countered by giving an example of one home that was underpriced.
Brisk sales are positive indicators as well as homes that go more for asking. But the homes are now strategically being listed by banks under the asking price to generate a sense of urgency. I get suspicious from the experts who profit and would love you to beleive that you better get in while you still have a chance. Yes. With $8K of free money (a.k.a. no money down) this has propped up the prices. If they give $50K of free money, that also will raise the prices and create demand. Yes. Intentially keeping interest rates down will prop up values as people buy 'payments". But what happens in a year when they terminate this free money for buying homes and the rates rise even a percent. Could we see a reversal??? The fundamentals to my eyes show that we have a ways to go when you consider data not presented. And each and every month it seems we get some more folks laid off. To MY eyes, Vegas has more to go. I'd certainly feel comfortable about buying an "average" priced home and especially a $60K condo. But still not as an "investment". Unless of course and "investment" doesn't calculate overhead.
I'm still waiting for an expert to explain why prices can go down when the market is so hot.
In September, a popular form of financing used by first-time home buyers – government-insured FHA loans – accounted for 53.8 percent of all home purchases, up from 52 percent in August. Absentee buyers bought 40.4 percent of all Las Vegas–area homes last month – the highest figure for any month this decade. Absentee buyers are often investors, but could include second-home buyers and others who, for various reasons, indicate at the time of sale that the property tax bill will be sent to a different address.
Think about that for a second: investors probably account for more purchases in Vegas than at the height of the bubble. Combined, these 2 forms of purchase account for 94% of all purchases in the "recovering" Vegas market. Who was saying that the 1st time buyer with their $8K credit wasn't a factor in Vegas housing "recovering" market??
Next, 5014 homes were closed in September and 68.4% were foreclosures sales. So 3429 foreclosure homes left the market but 3162 were NEWLY foreclosed on. Pile on some more phantom inventory. 3162 NEW foreclosures in a month does not seem like a deflated bubble especially is they are coming in from higher value homes. Once the tax credits end, I predict you will hear some more deflating.
The bubble is over??? Don't put away your pom-poms yet; we need some more cheerleader to find some buyers.
One of the problems is that you do not understand this stuff. For instance different address and FHA are different and don't add.
The present market offers only the split of cash, convential or FHA/VA. Below the median it approaches half cash driven primarily by investors at the low end. Above the median it is about 21% cash which is not far off normal.
Overall October is 39% FHA/VA, 33% cash and 26% conventional.
The belief that there is still some big problem coming on more expensive housing would appear to have little basis. For instance Sun City Summerlin rose from about $150 psf to $212 and is back to about $150. That is a drop of about 29% from the peak. The rest of that area rose from about 120 to $220 and back to $120 for a drop of 45% from the peak. Both Sun City and its neighbors appear mostly stable at this point.
Other areas such as the NW or many of the condo conversions have taken vastly larger drops. That however is primarily REO driven and appears to have ended.
Prices in Las Vegas are stable or slowly increasing. The reason for the first half drop was that the lenders chose to move the inventory by lowering price below market. They now assert the appraiser drove that...but probably not true.
One of the problems is that you do not understand this stuff.
... The reason for the first half drop was that the lenders chose to move the inventory by lowering price below market. They now assert the appraiser drove that...but probably not true.
I re-read your text a few times. I struggled to understand your descriptions including this one..
So this is your answer as to why prices have dropped DRAMATICALLY in Vegas even though sales have been extremely strong for 2007, 2008, and 2009?? Do I understand your (confusing) answer correctly?? And I am the one who doesn't understand this "stuff"??
So here is an overall summary from our back and forth posts:
One out of 20 homes in Vegas is in foreclosure.
In Q3 2009, 69% of all homes owe more than they are worth (compared to 32% nation wide)
Las Vegas led the nation with 5.13 percent of households receiving a foreclosure filing, almost seven times the national average. Filings rose 54 percent from a year earlier
3162 NEW foreclosures filings were in the Vegas market in October alone.
22.6% off all home owners in Vegas are currently behind on their mortgage or in foreclosure.
NV unemployment is over 13% and is predicted to increase at least until spring. Default rates correlate to unemployment rates.
Moody’s Economists predicts 24% lower prices in Vegas in Q2 2010.
The PMI Group predicts falling prices in the Nation.
Good News: REOs are increasing in price across the country including in Vegas.
Good News: REO’s are also selling higher than list for the past 3-4 months including 104% of list in Vegas.
The cost to rebuild has dropped (by a lot) which will apply pressure on a rebound to 2006 levels.
50% of HAMP loan modifications result in foreclosures; those will re-hit the market.
Most sales are government backed FHA loans with low down payment (over 50% according to some sources).
$8K subsidy was the catalyst for multiple bids. It will end one day and the artificial interest rates should head higher.
Ignore all of that. A Realtor on this board thinks we are are not at the bottom, we are on our way up! "80%" chance.
I re-read your text a few times. I struggled to understand your descriptions including this one..
So this is your answer as to why prices have dropped DRAMATICALLY in Vegas even though sales have been extremely strong for 2007, 2008, and 2009?? Do I understand your (confusing) answer correctly?? And I am the one who doesn't understand this "stuff"??
MNBNR, you have to learn to ignore a good bit of what he writes. This is the same guy that was telling people in 2006 that there was no bubble in Vegas real-estate, that there was a significant probability that RE prices would be up 10% from Dec. 2008, that housing prices had to increase when REO inventory fell, etc. It's a shotgun approach of throwing out enough predictions that sooner or later one of them will come to pass.
I re-read your text a few times. I struggled to understand your descriptions including this one..
So this is your answer as to why prices have dropped DRAMATICALLY in Vegas even though sales have been extremely strong for 2007, 2008, and 2009?? Do I understand your (confusing) answer correctly?? And I am the one who doesn't understand this "stuff"??
Your coments become duller each time you write. Where is it in evidence that sales were "extremely strong for 2007, 2008, and 2009?? ". You may have written that not I. Sales were terrible through 2007 and early 2008 and began to increase substantially in the 2H08. They have been quite strong since often setting all time monthly highs.
So here is an overall summary from our back and forth posts:
One out of 20 homes in Vegas is in foreclosure.
In Q3 2009, 69% of all homes owe more than they are worth (compared to 32% nation wide)
Las Vegas led the nation with 5.13 percent of households receiving a foreclosure filing, almost seven times the national average. Filings rose 54 percent from a year earlier
3162 NEW foreclosures filings were in the Vegas market in October alone.
22.6% off all home owners in Vegas are currently behind on their mortgage or in foreclosure.
NV unemployment is over 13% and is predicted to increase at least until spring. Default rates correlate to unemployment rates.
Moody’s Economists predicts 24% lower prices in Vegas in Q2 2010.
The PMI Group predicts falling prices in the Nation.
Good News: REOs are increasing in price across the country including in Vegas.
Good News: REO’s are also selling higher than list for the past 3-4 months including 104% of list in Vegas.
The cost to rebuild has dropped (by a lot) which will apply pressure on a rebound to 2006 levels.
50% of HAMP loan modifications result in foreclosures; those will re-hit the market.
Most sales are government backed FHA loans with low down payment (over 50% according to some sources).
$8K subsidy was the catalyst for multiple bids. It will end one day and the artificial interest rates should head higher.
Ignore all of that. A Realtor on this board thinks we are are not at the bottom, we are on our way up! "80%" chance.
MNBNR, you have to learn to ignore a good bit of what he writes. This is the same guy that was telling people in 2006 that there was no bubble in Vegas real-estate, that there was a significant probability that RE prices would be up 10% from Dec. 2008, that housing prices had to increase when REO inventory fell, etc. It's a shotgun approach of throwing out enough predictions that sooner or later one of them will come to pass.
Yeah we agree. MNBNR will do much better with the Soprano approach. Take some bit out of context and dwell on it. Ignore any real issues so that your lack of knowledge will be less apparent.
Just watch Tony. He is quite good at it.
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I'm still waiting for the answer as to why prices are going down while the demand is so strong?? It seems he is ducking the question.
Don't put away your pom-poms yet; we need some more cheerleader to find some buyers.
It contains all of the data. People should read it and determine their own conclusions.
Yes. With $8K of free money (a.k.a. no money down) this has propped up the prices. If they give $50K of free money, that also will raise the prices and create demand. Yes. Intentially keeping interest rates down will prop up values as people buy 'payments". But what happens in a year when they terminate this free money for buying homes and the rates rise even a percent. Could we see a reversal??? The fundamentals to my eyes show that we have a ways to go when you consider data not presented. And each and every month it seems we get some more folks laid off. To MY eyes, Vegas has more to go. I'd certainly feel comfortable about buying an "average" priced home and especially a $60K condo. But still not as an "investment". Unless of course and "investment" doesn't calculate overhead.
