Careers     Rental Application     Tenant Login     Call Us:   702-376-7379


Las Vegas Real Estate: Foreclosures Only 7% of Available Residential Listings

Las Vegas Real Estate: Foreclosures Only 7% of Available Residential Listings

Las Vegas Real Estate: Foreclosures Only 7% of Available Residential Listings

As of this writing, the Greater Las Vegas Association of Realtors Multiple Listing Service (MLS) showed a total of 8,793 active Single Family Homes, Town Homes and Condominiums available with no offers. Here is the breakdown:

  1. 649 foreclosure listings which comprise 7.3% of all listings
  2. 1,338 short sales which comprises 15.2% of the market
  3. 1,987 distressed sales (short sale + foreclosures) which equates to 22.5% of the market
  4. 6,806 listings are traditional sales which make the up 77.5% of the market

 Housing Units and Vacancies

The University of Nevada-Las Vegas’ Lied Institute for Real Estate (pronounced “LEED”) reported in its Housing Market 2013, 2nd Quarter (displayed above) there were an estimated 72,737 vacant properties in the Las Vegas area. This is a vacancy rate of 9.4%. It is clear from the numbers of listed homes as compared to the overall vacancy rate in the Las Vegas real estate market that there is still a sizable shadow inventory that exists.

Another interesting component of the overall health of the market is new home sales. According to Lied’s Oct 2013 Market Conditions Report, new homes sales were down 77% from last year at this time. You may be wondering what new home sales would have to do with the amount of foreclosures. The relevancy is that still 41% of homes with mortgages are under water (UNLV LIED INSTITUTE FOR REAL ESTATE STUDIES, REPORT ON NEVADA HOUSING, OCT 2013, PAGE 16). The prospect that prices have peaked means that those yet hoping to get bailed out by rising prices are unlikely to see that scenario pan out, leading to more distressed sales.

If this data correctly suggests that prices will stall or decline once again; then the action buyers and sellers should take is pretty clear. If you were thinking of selling now is a great time to lock up your equity. If you’re looking to buy, you’ll need to look at this market very honestly when deciding whether or not to enter.

Las Vegas Real Estate: Residential Market at a Crossroads

The Las Vegas real estate market has seen a run up of about 32% across the board over the past year according to several sources such as Zillow.com and Greater Las Vegas Association of Realtors released for the month of August 2013.

During the past three months there have been some fundamentals in the market that causing concern to a growing number of persons attuned to the Las Vegas Real Estate Market.

  • Las Vegas’ unemployment rate remains high. According to the Bureau of Labor Statistics the unemployment rate in Las Vegas declined from 9.7% to 9.6%. That figure of one tenth of one percent equates to about 1000 persons. Unfortunately 5,000 workers left the job market and are no longer considered part of the equation so although the rate dipped the actual number of persons without work actually increased. Las Vegas trails only Detroit in the highest unemployment rate of major metropolitan areas.
  • Interest rates currently held down by Quantitative Easing (the Federal Reserve pumping money into the economy by purchasing bonds and other assets). Currently, the Fed buys 85 Billion dollars a month or over a trillion per year. Printing that much money will eventually stop and interest rates are then expected to rise. Remember, to the average home buyer getting a loan, a rise in interest rates erodes their purchasing power. This point goes to affordability. Since payments go up when rates go up, the amount a borrower can then qualify for goes down. In essence, the Affordability Rate goes down.
  • The Wild Card, Investors – During 2010 through early 2013 as much as 50% of the purchases were made in cash, which most likely indicates investors and not long term homeowners. Las Vegas Realtors during 2012 were bombarded by institutional buyers such as hedge funds seeking to purchase homes directly off the Las Vegas MLS. The pitch was that these buyers were looking for a 5-10 year hold period for the assets they purchased and were mostly interested in attractive rents. Even Wall Street didn’t expect to see 30-60% gains in values in less than a year as some neighborhoods subsequently appreciated. It cannot be understated that as quickly as these investors came in, they could pull up stakes and leave by selling their assets. These owners are not here for the long term, they came simply to make money. If values were to go down, these investors would have to head for the door to protect their gains. Once that happened the market could become flooded with inventory.
  • Inventory is up and closings are down. One thing appears fairly certain from my view, there is no upward pressure on Las Vegas real estate prices any further. The only question seems to be whether they will stabilize at current levels or begin to decline again. Sellers if considering selling their home may well be choosing a great time to sell.
Landlords

Landlord Wants to Sell Las Vegas Investment Property, So What Happens With the Tenant?

I spoke with one of our property management clients today and he inquired about selling his Las Vegas home but he wanted to know if he had to wait till the tenant vacated the property before he could sell.  This was the second time I was asked this question in the last two weeks.  Any Nevada landlord has the right to sell their investment property whether the property is occupied by a tenant or not and the tenant is required to give the landlord reasonable access to show the property.

Usually, our tenants agree to cooperate with showings when they are notified the landlord has decided to sell the property but they do have numerous questions such as:

  1. Do I have to move? No, you have a valid lease and the lease will transfer with the sale of the property.
  2. Do I have to let people in to see the home?  Yes, our lease requires you to allow reasonable access to the property for showings to prospective buyers.
  3. Am I required to have a lock box on the property? No, we understand that you don’t want strangers walking through your home when you aren’t present so all showings will be scheduled with you.
  4. Can I buy the home?  Yes, as long as the owner accepts your purchase offer.

Occasionally we will get that tenant that states they don’t care if the owner wants to sell and they have the right to quiet enjoyment so they will not allow anyone access to the property.  At that point we will explain that their lease explicitly states they have to give the landlord reasonable access to show the property to prospective buyers.  Lastly, we will point out that NRS 118a.330 states the following:

A tenant shall not unreasonably withhold consent for the landlord peaceably to enter into the dwelling unit to exhibit the dwelling unit to prospective or actual purchasers, mortgagees, tenants, workers, contractors or other persons with a bona fide interest in inspecting the premises.

If the tenant still refuses to give access to the property, we will post a 24 hour notice to enter the property during normal business hours.  Luckily, we have never had to post a 24 hour notice to show a property to a prospective buyer as most of our tenants understand the owner has the right to sell their property and cooperate.

If you have any questions about selling your Las Vegas investment property or are in need of a property manager, give me a call at 702.376.7379.

Las Vegas Real Estate: Should Sellers Sell in 2013?

Statistics provided by the Greater Las Vegas Association of Realtors reported that in June of 2013 the median home price in the Las Vegas area was $183,569. That is a nearly 38% increase over the median price of a single-family home in July 2012 and up 55% since the bottom in Jan 2012. The $183,569 median is also akin to the same median of late 2003/early 2004.

On the surface it is easy to come to the conclusion that prices are simply rising to the pre-bubble prices prior to 2005. Real estate markets though offer other clues to determine the motivation of buyers and seller and indications of what may be to come.

Some of the most savvy real estate professionals and investors who have been dialed in to the post-crash market are wary of the rapid price appreciation. In my own business, I was advising buyers to quickly purchase in late 2011 and early 2012 when foreclosures halted in anticipation of an inventory shortage. I wanted to get them a home, before a price spike hit. I was worried the buyers might become afraid of the market change, or even worse, no longer qualify! Luckily, most were able to purchase during this time period and they are sitting in a great position today.

If you want my conclusions, skip to the bottom. If you want to know “the why”, keep reading!

Some of the troubling aspects of our Las Vegas real estate market are as follows:

  1. Until about 2 months ago we had been in a low inventory environment since the 2nd quarter of 2012 after the implementation of NV 284 (the anti-robo-signing legislation which virtually halted foreclosures for over a year). Over the last 6 months however inventory has increased 60%! Sales have been flat at around 3800 units per month since March of this year.
  2. There is a conversion occurring from a seller’s market into a buyer’s market. The reason any buyer wouldn’t think this to be the case is based on their experiences they have witnessed themselves or have hear stories of  multiple offers situations, buyers being forced to pay for short sale negotiation and assorted extra fees. Due to the large amount of cash buyers, getting closing costs paid has been quite rare, even on financed offers. How can this be if inventory is increasing? The reason is simple. Distressed real estate makes up only 16% if the available inventory and that is where the cheap prices have resided. With that comes the highest demand. Many buyers are now becoming more patient as their choices on the amount of homes is increasing quickly for the first time in years paired with their reluctance to pay high prices. This is less the case in the under $125,000 market but more prevalent in higher ranges.
  3. Too many investors purchasing homes in Las Vegas. This is not healthy. This is institutional money being invested in our market and it is short term. These investors will leave. They are not like traditional owner-occupants who are here for the long haul. The danger is when they do leave they could do so quickly in order to try and protect their gains. Doing so could place large numbers on the already flat sales market. Once buyers sense a potential glut, the slow-down often becomes self-fulfilling, pulling sales and prices down.
  4. Some of the large hedge funds are slowing down their purchases or stopping as their projected rents are no longer attractive when compared to purchase prices.
  5. New Homes: the average price is around $265,000, almost a whopping $100,000 above the median resale home. These homes are grossly over-priced and quickly lose value in a year or two when as resale homes they must go the market and compete as like properties with other resales.
  6. More notes about new construction homes: the parallels to 2005 are eerie. I can still remember one of the first salvos of the market correction when Pulte Homes lowered in many of communities by a straight $100,000 across the board in July of 2005. Imagine you were a home homeowner who saw that report on the news a month after you closed escrow.  New homes are over-priced! I cannot stress that enough. They have plenty of room to roll back prices and that is dangerous. They can trap their homeowners in underwater positions when they significantly reduce prices. Realtors are also once again seeing very high commissions in some new home communities. When commissions go up it another sign that things are not well. We have also seen some lotteries at new homes sites. Imagine that, a metropolitan market such as Las Vegas with 44,000 vacant homes and over 80,000 mortgages not being paid is having home lotteries!
  7. The price of money and interest rates: we have become so used to these low interest rates that the average person gives no thought anymore to their meaning. The government has been printing money to stimulate our economy for four years now. Essentially, they are giving it away for nearly free. It is not however being given to you and I. It is being given to large financial institutions and they can’t buy stuff fast enough. These guys are simply looking as Las Vegas as an investment pool. You can’t fault them for it. It is their job to make money. Do not however look at their purchases as any sign of a true recovery. Few things have more impact on a real estate market than interest rates and we all know we have benefited from artificially low rates due to Feds monetary policy of Quantitative Easing, pumping money into the economy to stimulate it. Interest rates are in the opinion of most in the Industry are set to go up over the next year. The higher they go, the more they erode the purchasing power of the buyers.
  8. Las Vegas home prices trends over the past 8 years versus the previous 20 years have been composed of wild swings, not the slow line appreciation or depreciation. 2004-2006 saw the bubble, then the cascading crashes of 2007-2008. We saw an REO (foreclosure listing) bubble in 2009 as buyers wanted to take advantage of the $8000 tax credit. 2010 saw more falling prices when the “tax credit bubble” ended. In early 2012 prices started up and are now up 48% since that time. Some of the hotter neighborhoods such as Summerlin are up even more than that. In 2010-2011 you could pick up two bedroom condos for $50,000 all over MLS and now most of those are $80,000 and above.
  9. The basic problem of the real estate/foreclosure crisis has still not been fixed. The fundamentals are still wrong, 80,000 homeowners not paying their mortgages and tens of thousands of vacant homes still loom over the market. Our inventory is very likely to continue experiencing inventory expansion when you factor that the “shadow inventory”  which will eventually be brought to market and the high number of investor-owners in Las Vegas that may choose to cull their profits and sell; especially if the public perception becomes one of a buyer’s market. An increasing Las Vegas real estate inventory will make it likely corrections will occur as sellers will have to compete to get their homes sold.
  10. Public perception lags several months behind hard data. Do not under-estimate psychology in the market place. Do you know how many buyers told me in 2012 they were waiting to buy because they thought the market was going to drop another 5 points? The market was down 55% and they wanted to squeeze another 5% off the adjusted basis price. Prices quickly went up in a month or two and many missed the opportunity to buy all together. Some bought later paying 20-30% more fearing prices would only escalate.

Conclusions

I want to be clear; I am not calling for a price crash. I am however projecting that it is very likely we will see corrections in the market based on the previous reasons listed. The old adage still applies, buy when most want to sell, and sell when most want to buy. The trough of low inventory has already passed and the amount of sellers is on the rise. Once public perceptions take hold and the media also begins to report the change, the momentum will likely increase.

When the affordability index starts to favor renting as opposed to buying, it’s time to sell. Let’s be honest, most of you never expected to see gains like you have in the past 12 months. This time around, don’t get caught, turn your paper equity in to what really matters, cash.

Paul Rowe is a short sale specialist and listing agent with Shelter Realty. He is also a real estate investor.

Call Shelter Realty at 702-376-7379 and ask to speak to Paul. He will provide free analysis of your home value and how it relates to your needs as seller. You may also fill out a contact form on this website or email     info @shelterrealty.com

What Are Your Investment Goals? Helping Investors Choose Las Vegas Properties and Manage Them

What Are Your Investment Goals?

Many real estate investors are finding the Las Vegas area, including Henderson and North Las Vegas, a great place to meet their investment goals. Investors from out of state or out of the country are flooding the market with cash and snatching up homes. Especially these days, you often find news articles talking about how much real estate has gained in value; investors feel pressure to purchase as quickly as possible, since the appreciation rate is going up faster than expected.

Buyers who were waiting for so called “Shadow Inventory” missed their chances to purchase at the bottom. Now we see bank owned homes listed at higher than traditional sales, banks are not flooding the market with low-priced homes at present.

For investment, not only purchase price and location, there are many other factors that have to be considered. Many home owner associations restrict renting homes, and some communities have too many available rentals on the market. To help you acquire the best investment property for your needs, we provide rental comparatives of the same subdivision which include the number of available and leased homes or units. We also research the history of each property and check the prices in the same communities at the peak of the real estate boom.

Home owner association fees, master plan fees and SID/LID will add up your monthly expenses. Repair costs, landscaping, window blinds and appliances also have to be considered.

Atsuko Winston and Sachi Reeske together hold a property manager permit, short sale designation CDPE, bank owned BPO/REO designation and single family CFAC/SFR certification.  We assist investors daily in purchasing properties and placing good tenants in them.

Nevada Landlord Requirements Upon Termination of Tenancy

Many Nevada landlords are not aware they have a responsibility to provide the tenant with an itemized accounting of their deposit within 30 days of the termination of tenancy.  If the landlord fails to return the tenants entire deposit or an itemized accounting of the deposit within 30 days, the landlord could be held liable by the courts for up to the full amount of the security deposit.

NRS 118A.242 states the following:

Upon termination of the tenancy by either party for any reason, the landlord may claim of the security or surety bond, or a combination thereof, only such amounts as are reasonably necessary to remedy any default of the tenant in the payment of rent, to repair damages to the premises caused by the tenant other than normal wear and to pay the reasonable costs of cleaning the premises. The landlord shall provide the tenant with an itemized written accounting of the disposition of the security or surety bond, or a combination thereof, and return any remaining portion of the security to the tenant no later than 30 days after the termination of the tenancy by handing it to the tenant personally at the place where the rent is paid, or by mailing it to the tenant at the tenant’s present address or, if that address is unknown, at the tenant’s last known address.

If the tenant disputes the itemized accounting statement in writing within 30 days of receiving the statement, a landlord cannot send the outstanding balance owed to a collection agency unless you obtain a judgement against the tenant.  This is why it’s very important to have a move-in condition report completed at the time of tenancy along with pictures to compare with the move-out report and pictures.  Keep in mind, a landlord can only hold the tenant responsible for damages to the premises, cleaning and any unpaid expenses during tenancy such as rent.

Whether you are accidental landlord or an investor, not knowing Nevada law can get you in big trouble.  If you decide not to hire a knowledgeable property manager, it’s imperative you take the time to familiarize yourself with NRS 118A to minimize future legal issues.

Not knowing or understanding Nevada landlord/tenant law is another reason why hiring a property management company to handle the management of your investment property makes sense.  To discuss the management of your investment property, give Shelter Realty a call at 702.376.7379 or email us at info @ shelterrealty.com.

Paul Rowe of Shelter Realty Completes CDPE Short Sale Designation Course

Las Vegas, NV – February 5, 2013 – Shelter Realty

Shelter Realty’s top producing short sale listing agent recently added the CDPE (Certified Distressed Property Expert) designation to his license after completing their intense two day course on January 29th, 2013. The Charfen Institute which created the CDPE course has established itself as the preeminent training program for short sales.

The need for qualified short sale agents in the Las Vegas real estate market has dramatically increased after the market crashed in 2008 and sellers needed a viable alternative to foreclosure.

When asked why Paul took the course despite having already closed nearly one hundred short sales already, he replied: “It is important for sellers to know who is a true expert and who is not. I had the experience and plenty of short sale closings, but it is also important for future clients to see that I have completed formal training as well.” The CDPE designation is something the public recognizes and helps them during their evaluation period when deciding if an agent has the skills necessary to guide them through very difficult circumstances.

Paul also belongs to other short sale groups such as Short Sale Genius, Short Sale Superstars. “Constant training is necessary to serve my clients, he said. Nobody has all the answers, especially in a rapidly changing field like short sales. The way we do short sales is dramatically different from just a few years back. I belong to work groups with agents and other real estate professionals from across the country which provide valuable support should a short sale transaction begin to encounter serious difficulties.”

You can reach Paul Rowe by calling Shelter Realty at (702) 376-7379 or by emailing info @ ShelterRealty.com or by filling out a contact form on the Shelter Realty website.

Las Vegas Short Sales: Bank of America Issues Changes to Short Sale Programs

Las Vegas Short Sales: Bank of America Issues Changes to Short Sale Programs

Bank of America came out with a few changes to their short sale programs today. The first change mostly affects flippers. Short sales closed through Bank of America now have deed restrictions upon re-selling the property. The home cannot be resold within 30 days (aimed directly at double-closings). Furthermore, the home can only be resold for 120% of the short sale price within 90 days after the short sale closes. Many flippers use high interest, liquid funds and often want to sell the home quickly to avoid high holding costs.  This will not in all likelihood stamp out flipping but the trend is clearly designed to hamper it. The banks are upset that money is being left on the table that they did not recover on the original short sale.

The other set of changes relate to seller incentives for relocation expenses from Freddie Mac and Fannie Mae if they are the institution which holds the note that Bank of America may be servicing on behalf of your mortgage. Fannie and Freddie may pay up to $3,000 on short sales except in the following cases:

  1. The borrower is required to contribute funds or execute a promissory note.
  2. The borrower has Permanent Change of Station (PCS) orders and receives a Dislocation Allowance (DLA) or other government relocation assistance.
  3. The servicer has knowledge that the borrower is receiving relocation assistance from another source other than the servicer.

It should be noted that if the seller is receiving incentives from another source for the short sale and it exceeds $3,000 and this is a Freddie Mac or Fannie Mae loan, then no incentive will be paid in addition to the alternative incentive payment.

There are now multiple incentive programs related to Bank of America serviced loans; some in excess of $30,000. If you know that some point your upside down mortgage is unsustainable then it is important to check out all your options that may provide a graceful exit from the situation and maybe even get some money on the way out as well.

You may call Shelter Realty for a personal assessment to explore if a short sale is a good option you. Call 702-376-7379 or complete our contact form.

Reprieve for Las Vegas Home Owners: Mortgage Debt Forgiveness Act Extended until Jan 1, 2014

Reprieve for Las Vegas Home Owners: Mortgage Debt Forgiveness Act Extended until Jan 1, 2014

Las Vegas home owners of primary residences who were facing foreclosure in 2013 would have faced serious tax consequences without this extension. The original Debt Forgiveness Act of 2007 signed by President Bush allowed for owners of principle residences who either were foreclosed upon or who short sold their home to avoid significant capital gain taxes. Owners were exempted from the heavy taxes as long as their home was considered a principle residence during the preceding five years and the debt forgiven was used to purchase the home or were used as documentable improvements to the residence.

Congress has now extended the Act through 2013 which will help both types of owners, those who get foreclosed and those who want to do a short sale. Owners who know they cannot get a loan modification and are considering a short sale have a clearer path to selling their home and debt relief.

Any persons with questions may call Shelter Realty for a personal assessment if a short sale is a good option for them. He may be reached at 702-376-7379.

Pictures of New Home Construction Process in Henderson

Las Vegas area resale inventory is still showing a shortage of available homes for sale. Whether more foreclosed homes will come out on the market or not, you currently hardly see any bank owned homes available here in Henderson.

Responding to current market conditions, new home builders are confident and raising prices aggressively. I was told that we had to win a lottery to get a parcel of land we wanted to purchase. It reminded me of the bubble boom time.

A young couple from overseas signed a contract in July for a new home, since then the builder raised prices a couple of times totaling over 20 thousand dollars.

KB Home sales person Barry Goodman sent us pictures of the afore mentioned home construction every week.

Here are some pictures of the home (Inspirada, Henderson)

Aug 5, 2012 Trenching

Aug 11, 2012   Post Tension Slab

Aug 18, 2012   Framing

Aug 24, 2012   First floor completed

Sep 2, 2012     Second floor is done

Sep 8, 2012     Windows put in place

Pictures provided by: Barry Goodman / KB Home

For more information on new homes, please contact Atsuko Winston at 702-461-5694 or Sachi Reeske at 702-324-8678.

Seven Hills: Tuscan Getaway Minutes from the Vegas Strip

Tired of the hustle and bustle of Las Vegas?

While it is true Las Vegas is considered Sin City, even the most ardent of Sinners must eventually repent. And what better place then in the rolling hills of the Tuscan inspired community of Seven Hills. This is truly one of those magical places that can whisk you away from where you are and take you far away to the romance of the Italian countryside and yet still give you breathtaking views of the Las Vegas Strip.

Many of you may wonder what the significance of Seven Hills is. It’s said that it was named after the Seven Hills that Rome was built on. Though it is more of Tuscan design than Roman, the feeling of Italy is still here. You can see it’s impression on every stone. I doubt either Roman courtesans or the Emperor himself would find fault with this beautiful community.

Seven Hills is located only about 20 minutes from the strip in the Henderson area and is literally minutes form the heart of Henderson, so shopping and entertainment are never far away. The community is broken up into around 25 different communities, each with it’s own Italian name, lest you remember you are still in Vegas. There are gated communities within gated communities giving an even greater air of exclusivity. Within these communities the properties vary immensely from beautiful town homes to incredible Tuscan villas.

Are you looking for a nice evening out with the family, but don’t want to go too far from home? Shared amongst the residences are 4 large parks with tennis, volleyball, basketball, and even soccer fields. Maybe you’ve had a hard day at work and are looking for something a little more serene? How about a picturesque walk through one of the many winding paths or perhaps a relaxing bike ride on one of the bike ways. Or possibly, you would rather just sit and relax, and gaze at the surrounding mountain views above, or the Las Vegas strip lit up at night, down below.

Are you looking to live in the luxury the emperor himself might have lived in? There is a place for you here as well. The Estates at Seven Hills is one of the most exclusive communities in Henderson. And for those of you that love golf it’s the perfect place to reside. Within the Estates lies what Golf Digest named one of the top 10 new golf courses in America. The Rio Secco Golf Club. It was designed and constructed by none other that Rees Jones. The course itself has some of the most breathtaking views around and the homes that border the course offer some incredible views of the course itself as well as the Las Vegas Strip. If you find the course too challenging, don’t feel bad, it’s even given some professionals a run for there money. Luckily for you however, the Butch Harmon School of Golf is also located here so you should be able to improve your game in no time.

So whether you are a courtesan or an Emperor, or just a loving family looking for a magical place to live, Seven Hills is waiting for you. Come home to the Tuscan countryside, come home to Seven Hills. For more information on homes in the Seven Hills area, please call 702.376.7379

The Martin in Las Vegas

Thinking of buying or renting a condo at The Martin in Las Vegas? Three words location, location, location!

Cross over the hardly used Harmon bridge making use of amenities, such as Range Rover car service along with concierge service providing any tickets to shows or sporting events, ensuring an effortless night on the town.  Or simply get away from the Las Vegas hustle and bustle by using the main road the martin is located on and hit the freeway off Tropicana.  Planning a visit to your home away from home? Call ahead and have the concierge stock your condo with food before you come into town for a weekend stay.

Once you pull up to The Martin allow white glove valet attendants to take care of parking your car and even give it a detail if you wish.   Why go out when you can stay in? The health and wellness programs, fitness center and yoga studio, spa, steam rooms, and cabanas poolside will ensure a full day of relaxation, while the house cleaning service takes care of the to do list in your residence.

After a long hard day of relaxation why not take advantage of the beautiful Las Vegas Strip views and entertain some friends or simply catch up on your favorite tv shows via direct tv satellite which is included in the your low HOA fees.  The Martin takes care of you , your pocket book and well being!

For more information about about buying, selling or renting at The Martin, give Len Musurichan a call at 702.308.1003 or send him an email at len @ shelterrealty.com