Some Las Vegas homes or condo buyers are NOT aware of the fact that a home or condominium seller only looks at the offers in terms of NET gain and pay no attention to the offer amount. To explain this I will discuss a hypothetical situation below:

A Las Vegas home for sale is priced at $200,000 and needs about $5,000 in repairs done, Las Vegas Realtors commissions are 6% and the buyer’s maximum amount allowed towards closing costs is 3.5%. Now the seller gets the following two offers:

Offer one: Is from a buyer who needs to finance his deal and offers $215,000, the buyer asks for the maximum $7,525 towards his closing costs and $5,000 seller contribution toward repairs. The net to the seller for this after deducting buyer closing costs and repairs and Realtors commission is $189,575. I am not including sellers closing costs as it remains constant for both offers.

Offer two: Is from a Las Vegas real estate cash investor at $202,000. Given that it doesn’t make sense to ask for closing costs or repair costs in a cash deal, the investor doesn’t ask for any. In this case the net to the seller is $189,880 and the seller will take the second cash offer in a heartbeat while the offer amount is $13,000 less than the first. The net for this offer is a bit more than the other but we have found that even if a cash offer nets less than the loan offer the banks will sometimes accept the cash offer over the loan because they can close a cash deal quicker and with less chance of falling out of escrow. If both offers needed financing the highest net would win.

Las Vegas homes or condominium buyers who have to finance their deal ask for seller contribution towards closing costs or repairs because they don’t have enough money to comfortably pay for them, this is not true for cash investors.

It doesn’t make sense for cash buyers to ask for closing costs or repairs because all that has to be done is to lower the offer amount by the desired number and submit a clean contract which has a much better chance of acceptance.

1: Las Vegas short sale home seller DOESN’T have to be behind in paying their mortgage.

2: No offer is needed to start the short sale process, listing a home or condo is enough. This will prevent ridiculously low asking prices so the listing agent would get an offer on the home before starting the short sale process.

3: The listing agent doesn’t have to waste a great deal of time trying to locate and open communication with an asset manager.

4: A short sale manager will contact the seller if necessary, the Realtor can be present when the short sale manger is interviewing the seller. This is awfully cool since the Realtor should be familiar with and bring up the issue of specific performance and try to get the seller out of hot water, if at all possible.

While I am on the specific performance issue, the asset manager said that he is not aware of anyone going after the short sale home seller for the first mortgage, but if a second mortgage is involved, it is sold to the type of people who have no conscience and would barbeque their own mother and eat her if there was any money in it. I am not kidding you.

5: If an offer is made on the property, the listing agent will e-mail the contract to the short sale manager which will review the contract and order and order an appraisal, NOT a BPO (broker price opinion). Unfortunately we run into low appraisals since if a home really appraises for $20,000 over the sale price the appraisal will come in at $1,000 over. Banks can obtain an appraisal from 150 mile radius of the property. Some appraisals in Las Vegas are done by appraisers in Bakersfield, California who are clueless. Wachovia will negotiate differences between their own appraisal and buyer’s appraisal that is mandated if the buyer has to obtain a loan.

6: It should take 6-10 days to obtain a bank approval for the short sale.

7: The Wachovia Short sale seller DOESN’T have to be an owner occupier. Las Vegas real estate investors are eligible to take advantage of the short sale process

8: If there is a second mortgage involved, Wachovia will try to settle the second mortgage with the lender. If a second mortgage can be settled they can close the deal in 45 days or less.

Related blog posts:

Foreclosure, Short Sale or Deed in Lieu? Which one will do less harm to your credit?

Foreclosure, Short Sale or Deed in Lieu? Which one will do less harm to your credit history? Part 2, Las Vegas short sales

Foreclosure, Short Sale or Deed in Lieu? Which one will do less harm to your credit?

Related Web-Site links:

Las Vegas short sale homes or condos for sale

 Las Vegas foreclosed homes or condos for sale

 Las Vegas homes or condos for sale

Why didn’t the mountains of foreclosure homes that real estate analysts kept foolishly predicting will hit Las Vegas housing market materialize?

1: Nevada mediation that is enforced by Nevada Supreme Court has slowed down foreclosure process

2: Federal Government pressure on the lenders and it is working (Attention Obama Bashers)

3: Bankruptcy: Takes time, ensures that lender can’t come after the owner for specific performance (lender suing owner for the difference between the sale price and mortgage owed on home)

4: Banks have finally realized that short selling Las Vegas homes saves them about 10% versus foreclosing on the home

5: Banks are finally starting to streamline the short sale process and make listing or making offers on short sales as painless as it can become

How do short sale homes affect Las Vegas housing market?

If selling a Las Vegas short sale can mimic a non-distressed traditional sale, then why should the bank severely undercut prices to attract buyers?

The only difference between a regular sale home and a short sale home is that one or more lenders are involved and should OK the deal.  If any seller contribution or repair demands are involved in the transaction, these should be allowed by the lender too, that is it.

The reason that we have avoided listing or making offers on Las Vegas short sale homes comes from the difficulty involved in dealing with the lenders.

If the bank has set policies to help conclude the short sale process and close escrow within 30-45 days and if I can find the asset manager with one phone call and have him deal with my seller in my presence then the short sale process is not much different from a regular sale.

Now the lender doesn’t have to market their homes at 10%-20% less than non-distressed regular homes in order to attract buyers and this will help stabilize our housing market.

Lastly: As I have repeatedly stated Las Vegas homes that can be financed with a FHA, VA or conventional mortgage will not see significant price cuts, especially homes that are priced below $100,000. If a Las Vegas home for sale needs financing through a Jumbo Loan, more troubles are ahead.

I will write about why we will list and show Wachovia bank short sales homes in Las Vegas next.

Related blog posts: Las Vegas homes for sale – Las Vegas real estate market 2010

Related Web-Site links:

Las Vegas short sale homes or condos for sale

 Las Vegas foreclosed homes or condos for sale

 Las Vegas homes or condos for sale

I have gone over the Las Vegas real estate market conditions for Las Vegas homes for sale for July-2010 and the reason that I picked July was that the tax credit had expired and would not significantly affect the results. If anything, July would be a bad month to report home sales in Greater Las Vegas, since home buyers who wanted to take advantage of the tax credit have already purchased their home.

While, most market reports about Las Vegas housing are based on the meaningless median price, I have tried to show that the home for sale market is not the same for all price ranges. See the market report for homes priced below $100,000 and luxury homes.  Sold prices for bank owned homes and short sales homes is at 105% of asking price for homes priced below $100,000 and if a buyer wants to buy a foreclosed homes in this price range, he/she has to compete with cash investors who can close the deal in less than 30 days. You can’t bring a plastic fork to a gun fight and expect to win; low balling offers in this price range will get you nowhere quickly.

The second issue that I have tried to show is that the market is not the same in every price range. Check out the sold price to asking price ratio for the more expensive homes, for example homes priced at $500,000-one million dollars. Foreclosed or bank owned homes that have sold in this price range have sold for more than 100% of asking price, while short sales have sold for about 92% of asking price and non-distressed homes for about 93% of asking price.

When a good Las Vegas Realtor makes an offer on a Las Vegas, Henderson or North Las Vegas home, he/she should take into account current market conditions by price range and type to have a good chance of success.

I do not see any significant price drops for homes that are priced below $200,000 based on today’s numbers with one caveat; at the moment investors are the driving force in the Las Vegas homes and condominiums market and these are a fickle bunch, one moment they are here and the next moment they are gone.

 Las Vegas real estate investors will not flee the Las Vegas housing market because it is a great investment opportunity as it provides good cash flow and excellent odds of good future appreciation as our housing market is about 17%-18% undervalued, but as long as our media is doing all it possibly can to scare the heck of them who know what will happen.

Where is the Las Vegas homes for sale market going?

I am happy to report that as far as I know 25,000-35,000 bank owned shadow inventory homes is DEAD, no one has brought it up since my blog series and subsequent declaration by Larry Murphy that put this number at 6,500 but fear mongering goes on unabated!

The next big wave is short sale homes; as lenders will try very hard to sell a home as a short sale before they foreclose on it and make the process palatable enough so that Realtors like me wouldn’t avoid them and it is starting to work.

The way that these banks are starting to deal with short sales will have a significant positive effect on the housing market and I will explain this next post.

I am reproducing the links for homes in all price ranges below so you can check yours.

Las Vegas real estate market – homes for sale priced 1 Million Dollars plus

Las Vegas real estate market – homes for sale priced $500K-One Million

Las Vegas real estate market – homes for sale priced $300,000-$400,000

Las Vegas real estate market – homes for sale priced $200,000-$300,000

Las Vegas real estate market – homes for sale priced $100,000-$200,000

Las Vegas real estate market – homes for sale priced below $100,000

Related Web-Site links

Las Vegas short sale homes or condos for sale

 Las Vegas foreclosed or bank owned homes or condos for sale

 Las Vegas non-distressed or traditional sale homes or condos for sale

This is the sixth article in the Las Vegas real estate market series that I am doing for August, 2010.

The inventory of multimillion dollar homes in Las Vegas is about 3.5 years and there is no need for the second table that I have had in previous blogs. Only one sold home was foreclosure or bank owned which is located in the exclusive Red Rock Country Club.  The foreclosing mortgage for this home was about three million dollars, asking price was 2.4 million and it sold for $100,000 less in 52 days. Red Rock Country Club is where the doctor who killed Michael Jackson used to live. His home was in the foreclosure process and it may show up in the MLS soon.

Now check out the difference with the one short sale home that sold in July. The short sale home was located in Seven Hills, which is adjacent to Henderson Executive Airport and Anthem. Asking price was 1.8 million and selling price was 1.3 million dollars which is 40% of the original price after being on the market for about two years.

Nine regular sale (non-distressed) homes sold in July for about 85% of asking price, two sold in less than 60 days and 4 in more than 120 days.

The inventory for million dollar plus homes is 8 months for foreclosed homes, 4.2 years for non-distressed traditional home sales and about 3 years for short sales.

This segment of the market will witness serious price cuts.

I will do a concluding blog in this series next.

The table below shows our current inventory of homes for sale in Las Vegas, Henderson, North Las Vegas and Boulder City priced $1,000,000 plus.

Related Web-Site links

Las Vegas short sale homes or condos for sale

 Las Vegas foreclosed or bank owned homes or condos for sale

 Las Vegas non-distressed or traditional sale homes or condos for sale

This is the fifth article in the Las Vegas real estate market series that I am doing for August, 2010. Well, if you want bad news, it is easy to find it in this price range. The inventory of homes in this price range is about 14 months and yet again we have to break down these by type of home sale.

Foreclosure or bank owned inventory stands at 5.6 months. Only 5 foreclosed homes sold in July and 4 out of 5 closed escrow or sold in less than a month, three out of four were purchased for $16,000-57,000 higher than the asking price, one sold at the asking price and the last one sold for $28,000 below asking price. Short sale inventory for this price range is 12 months.

Non-distressed sales are selling for about 93% of asking prices and the inventory of these homes is 15 months.

Now this is the type of data that screams price reductions, not homes that are priced below $300,000. Foreclosed homes or short sales are NOT the main reason that this segment of market is in trouble, it is difficulty with getting a Jumbo loan to finance these.

Sold homes were obviously priced to sell and a significant number of these homes are not priced to sell. The average days on the market for homes priced $500K-1 Million is 245 days before it sells.

Future price reductions can be worked in the offer, that is 4 out 5 bank owned homes sold in less than 30 days because they were priced low enough that if prices in this range go down another 10%-15%, these buyers will be protected.

Lastly, even in this price range buyers can’t lowball the bank since 4 out of 5 sold for more than or equal to asking price.

The table below shows our current inventory of homes for sale in Las Vegas, Henderson, North Las Vegas and Boulder City priced $500,000-1,000,000.

Check out the short sale homes, none were sold for more than asking price, the only one that sold in less than 60 days sold for $525,000 for about ten percent less than asking price. The biggest price reduction was for a home that was on the market for about 2.4 years, it sold about $200,000 less than asking price.

Double digit price drops in this range are not unreasonable, however bargains can be found.

Related Web-Site links and blog posts:

Las Vegas real estate market – homes for sale priced $300,000-$400,000

Las Vegas real estate market – homes for sale priced $200,000-$300,000

Las Vegas real estate market – homes for sale priced $100,000-$200,000

Las Vegas real estate market – homes for sale priced below $100,000

Related Web-Site links

Las Vegas short sale homes or condos for sale

 Las Vegas foreclosed or bank owned homes or condos for sale

 Las Vegas non-distressed or traditional sale homes or condos for sale

This is the fourth article in the Las Vegas real estate market series that I am doing for August, 2010, and differences with lower priced homes is striking. While 55% of short sale homes sold within 30 days for homes priced below $100,000 and 33% closed escrow in 60 days plus, this is reversed for short sales in $300K-$400K price range since it took more than 60 days to close about 2/3 of these short sale homes.

Available inventory in this price range is 4.9 months, but let’s break down these numbers a bit. The bank owned home inventory for this price range is 1.7 months and about half sold within 30 days. Now let’s look at short sale inventory; it is 3.3 months and non-distressed sales inventory is 7.42 months.  Here  the ratio of foreclosed homes to total listings is 7.4% while 21% of sold homes are REPOS.

One needs to reflect a bit about the affect of foreclosures on the total market for this price range and 7% inventory will not greatly affect the total number. The reason that foreclosure home sales are 3 times the inventory is twofold. One is many of non-distressed sales inventory is overpriced and if one looked at the number that are really priced to sell is far below the numbers shown and the other is that about two thirds of short sale homes took more than 60 days to close escrow and many buyers don’t want to wait that long to get an answer from the bank.

Now, when news organization discuss price reductions, it will be for this price range and higher and this is due to the fact that getting a Jumbo loan is very difficult and requirements for down payment are as high as 40% and this doesn’t make sense since there is no sign that these homes are going to lose that much in value in the future.

The table below shows our current inventory of homes for sale in Las Vegas, Henderson, North Las Vegas and Boulder City priced $300,000-400,000.

July sales for homes priced $300,000-$400,000 is shown in the table below. 417 homes have sold in this price range. 120 have been bank owned or Repo homes, 122 short sales and 175 were non-distressed traditional sales. As we go up in price the percentage of non-distressed sales increases.

 Future price cuts are more probable for this and higher range prices. Additionally, not too many buyers would make a decision to buy a home at this price range just because of the tax credit, so the impact of the tax credit in this price range and higher should not be statistically significant but the inability of the buyer to get a good loan with a low down payment is.

 Related Web-Site links and blog posts:

Las Vegas real estate market – homes for sale priced $200,000-$300,000

Las Vegas real estate market – homes for sale priced $100,000-$200,000

Las Vegas real estate market – homes for sale priced below $100,000

 Related Web-Site links

Buying short sale homes or condos in Las Vegas

Buying foreclosure or bank owned Las Vegas homes or condominiums

Buying non-distressed or traditional sale homes or condos in Las Vegas

This is the third blog post in the Las Vegas real estate market series that I am doing for August, 2010 since the majority of homes that were bought due to the tax credit have been sold by June-30^th. There is a concern that July home sales are skewed since most home buyers have already purchased their home, so be it.

The table below shows the current inventory of homes that have sold for $200,000-$300,000 by type. The total inventory is 1577 and this represent 3.75 months of available inventory.

The table below shows our current inventory of homes for sale in Las Vegas, Henderson, North Las Vegas and Boulder City.

July sales for homes priced $200,000-$300,000 is shown in the table below. 417 homes have sold in this price range. 120 have been bank owned or Repo homes, 122 short sales and 175 were non-distressed traditional sales. As we go up in price the percentage of non-distressed sales increases.

I f you look at the previous blog about Las Vegas homes sold for $100K-$200K you see that the ratio of sold prices to asking prices has gone down by 1%-2% and this is not significant. Only about 29% of sales are bank owned homes and this number will decrease as we go up in prices. Again these numbers are self explanatory. As I wrote before, the real estate market for Las Vegas homes for sale for up to $300,000 is lively and current numbers don’t support double digit drops in prices for the next 12 months. Now you see proof.

Related Web-Site links and blog posts:

Las Vegas real estate market – homes for sale priced $100,000-$200,000

Las Vegas real estate market – homes for sale priced below $100,000

Related Web-Site links

Buying short sale homes or condos in Las Vegas

Buying foreclosure or bank owned Las Vegas homes or condominiums

Buying non-distressed or traditional sale homes or condos in Las Vegas

This is the second blog post in Las Vegas real estate market series that I am doing for August, 2010 as the tax credit doesn’t significantly impact July Sales.

Let’s look at the market report for homes that have sold for $100,000-$200,000. I have to admit that it surprised me as there is a shift in how quickly short sale homes are closing escrow. We will start to show short sale homes in this price range.

The table below shows our current inventory of homes for sale in Las Vegas, Henderson, North Las Vegas and Boulder City

1673 homes that are priced $100,000-$200,000 have sold in Las Vegas, Henderson and North Las Vegas and Boulder City in July-2010 and this puts our current inventory of homes for this price range at 3.5 months.

Just like homes that have sold for less than $100,000, 2/3 of the homes sold in Las Vegas for $100K-$200K price range are foreclosures or bank repo homes, while the number of REPO listings is only 23% of total inventory.

These numbers are self explanatory but I want to add a couple of points:

1: About half of the short sale homes have closed escrow in the 60 days plus range; actually it took more than 120 days to close the deal on about 29% of these homes.

2: Las Vegas short sale homes and foreclosures are selling for the full asking price.

3: It is foolish to predict a 14% price drop for homes when they get full price offers.

Related Web-Site links and blog posts:

• Buying short sale homes or condos in Las Vegas
• Buying foreclosure or bank owned Las Vegas homes or condominiums
• Buying non-distressed or traditional sale homes or condos in Las Vegas
• Las Vegas real estate market – homes for sale priced below $100,000

This is a good time to take a look at the Las Vegas real estate market report since most Las Vegas home buyers who wanted to take advantage of the tax credit have closed their deals by June, 30 2010. Even though the tax credit was extended for 90 days, the effect of leftovers on the market report for July 2010 is not going to be significant.

Despite all the unfounded doom and gloom conspiracy that is propagated through Las Vegas and national media in order to prop up their pathetic sales, the market for homes that are priced up to $300,000 is lively and I will cover these by price range.

Let’s take a look at the market report for homes sold for up to $100,000 and I have to admit that it surprised me as there is a shift in how quickly short sale homes are closing escrow. We will start to show short sale homes in this price range.

The table below shows our current inventory of homes for sale in Las Vegas, Henderson, North Las Vegas and Boulder City

762 homes that are priced up to $100,000 have sold in Las Vegas in July-2010 and this puts our current inventory of homes for this price range at 2.5 months. 2.5 month inventories don’t lead to price cuts. Take a look at the sold numbers for July.

Even though the number of short sales and non-distressed traditional sale listings are 3 times the number of bank owned homes, more than half of the homes sold are foreclosures. Bank owned homes in this price range get multiple offers as soon as they are listed and about two third of these close escrow in 30 days as most of these are cash offers by Las Vegas real estate investors.

The other important number is the ratio of sold price to asking price; this ratio is at least 100% for most of these homes. Many investors who contact us expect to lowball bank owned homes as they think that the Las Vegas real estate market is flooded with foreclosures, NOT HAPPENING.

The story is a bit different for non-distressed homes; most of these don’t get full price offers as they are priced at 10%-25% higher than foreclosures so there is room for negotiation.

I leave it to the reader to decide if this data supports the ridiculous predictions of 14% price depreciation in Las Vegas residential market in the next 12 months  by a Wisconsin loan company!!!

Related Web-Site links:

• Buying short sale homes or condos in Las Vegas
• Buying foreclosure or bank owned Las Vegas homes or condominiums
• Buying non-distressed or traditional sale homes or condos in Las Vegas

The 25,000-35,000 unsold foreclosure or Bank Owned homes in Las Vegas that banks are holding back from the Las Vegas real estate market for fear of price reductions, have been the talk of town until I CRUSHED it through 4 blog posts.

I put forth the mathematical formula for calculating the number of shadow inventory homes in Las Vegas and explained how it should be calculated. I can because I have aced many PHD level mathematics courses while in Graduate School.

In the concluding blog post in the series I stated that this number has to be less than 10,000 and the only reason that I don’t have an exact number is that I don’t pretend to be a Las Vegas real estate analyst and don’t tabulate for example, the number of homes sold in real estate auctions or in bulk sales of land to the Las Vegas new homes builders which I have explained in posts, but true real estate analysts should.

 When Las Vegas real estate analyst Dennis Smith kept repeating there are 25,000-35,000 shadow inventory homes in Las Vegas, I did a blog post titled

Real estate analyst Mr. Smith GUESSES the wrong number of Las Vegas unsold foreclosed homes

In this blog I wrote “The best analyst is Larry Murphy, the real estate analyst that I pay no attention to is Dennis Smith and unfortunately others do”. And the reason is that I know for a fact that Larry Murphy tabulates sales transactions in Las Vegas by type and would have access to all of the data that is necessary to calculate the number of shadow home inventory in Vegas.  BEHOLD – The conformation for my assertions came from Larry Murphy.

This is from The Las Vegas Review Journal article today.

“Murphy estimated a “shadow inventory” of 6,500 homes owned by the bank that have yet to be released on the market, plus 18,500 pre-foreclosure filings that may or may not go to foreclosure.”

He also said “Even a shadow inventory of 25,000 homes is not that many, he said. Las Vegas had 24,067 foreclosures in 2008 and 20,426 in 2009”.

See my blog post about the effect of foreclosures on Las Vegas real estate market.

Las Vegas real estate, the effect of foreclosures (bank owned homes) on the Las Vegas homes market

I also used Mr. Dennis Smith’s name in the blog title, I have never used a name in a negative blog, because I have power and have to use it judicially. My blog post will show up in the Goggle first page when searching for the name of the person that I wrote about and if it is negative, it will negatively affect that person’s life and he would have no recourse. Google, (Dennis Smith Las Vegas) and you will understand, and keep in mind that he is very popular. The reason is that all he had to do is to Google (shadow inventory homes in Las Vegas) and would have found my blog posts that disprove the numbers that he kept using after I published my series of blog posts. I am not here to hurt anyone, but his bull that is published by broke newspapers which need sensational stories to sell papers is seriously effecting the lives of my fellow Realtors and real estate agents by falsely scaring away home and condo buyers in Las Vegas, I know more than a few starving Realtors.

In case you think that I am over reacting, see national so called “real estate analysts” predicting 20% drop in Las Vegas residential real estate prices in the coming year that can be easily explained if we have 35,000 shadow inventory homes in Las Vegas and impossible to prove if unsold bank owned homes inventory is 6,500. I will explain this in the next blog post.

Our buddies at Neighborhood Housing Services of Southern Nevada have located other sources of funding for Wish Funds that is administered by the Nevada, HUD. Wish Fund is the 3 to 1 matching down payment program for Nevada first time home buyers.  I will reproduce Michelle Villero’s e-mail below, she is Homeownership Director.

Good Morning Partnering Agents,

GREAT NEWS!  We just received additional WISH Funds.  The catch with these funds is that it is Lender Specific.  If you have clients who are interested in going through the program for WISH please let us know and we will give you the specifics on who to contact. 

Please keep in mind that funds are first come, first serve basis.  Remind your clients that the only way to reserve these funds is to have a fully executed contract.  Clients will still have to attend an (8) hour Homebuyer Class with a HUD certified housing counseling agency and also meet with one of our housing counselors to determine eligibility.

Well, Las Vegas, Henderson and North Las Vegas, Nevada first time home buyers call us before it before it runs out.

I received an e-mail from the charismatic Michelle Villero, home ownership director for Neighborhood Housing Services of Southern Nevada that states they are out of money for the Wish Funds program until they receive additional funding, and believe me these people would look as hard as any.

So, if you are a first time home buyer and were planning on using the Wish Funds for you down payment, you have to wait.

I have explained Nevada first time home buyer down payment and mortgage assistance in the web-site so you can look for other resources to help you with your home deal.

By the way, in order to get the assistance, you have to be represented by a Las Vegas Realtor and mortgage loan officer who has been approved to do these deals and we are.

While Las Vegas home or condominium sellers no longer accept an offer that is not accompanied by a pre-approval, getting  pre-approved is easy as the borrower doesn’t have to prove income or taxes which they have to prove when getting a loan.

The days of no doc loans are over and the lenders check on everything, if there is a discrepancy between the tax return and information submitted by the borrower, the deal is as good as dead. We have lost a deal and are in process of losing another one, while our clients have perfect credit. Saving real estate deals when problems as this arise is very difficult, we have exchanged four hundred e-mails in an attempt to save this deal however the odds are not good. Escrow problems are the best reason to have a Las Vegas Realtor involved in your deal. If it wasn’t for Realtors trying to keep this deal alive on both sides, this deal was dead long ago.

I have repeatedly written about getting under-written approved before buying a home or condo and have never met a buyer who has actually done this, doing so would avoid all financing problems and get the borrower the advantages that a cash buyer has.

If you, like everyone else will not get underwritten approved, at least make sure you tax returns match the information in your mortgage application before buying a home or condo in Las Vegas.

Another issue that is affecting borrowers is, believe it or not, pregnant borrowers. National news sites are reporting that banks are inquiring about the pregnancy of couples, given that it may influence their ability to pay the loan back.

Social networking: Las Vegas homes, condos and commercial real estate page on Facebook, Web-Site: Las Vegas homes, condominiums, land and commercial real estate for sale.

By the way, lenders are checking on homes or condominiums to make sure they are owner occupied when you get the loan as an owner occupied loan. A couple of clients who purchased homes at Seven Hills in Henderson told me that someone knocked on their doors and verified that the home was owner occupied.

Las Vegas new home sales have nearly doubled from high 400-500 to 972 in June-2010. This was due to the US government tax credit which got extended recently. However most, if not all, new home sales should have closed by now and next month new home sales should be back to the 400-500 level. City Center has started closing on its luxury high rise condos in June. 78 Closings at CityCenter Veer Towers and Residences at Mandarin Oriental have helped the new home sales numbers.

It is too late now to take advantage of tax credits. Las Vegas new home builders are offering $8,000 in free upgrades or interest rate buy downs to get new home buyers into their sales office.

As I discussed in the blog posts about comparing Las Vegas new homes with re-sales and bank owned homes, there is a price difference between resale homes and new homes and foreclosures. The median price for new homes in Las Vegas is at $180,000 which declined by 9% from last year. However the median price for non-distressed homes stands at $132,000, while foreclosures or bank owned homes have the median price of $121,000. As I wrote non-distressed homes get a premium for the ease of transaction.

Las Vegas news organizations go to about a few so called “real estate analysts” in Las Vegas and interview the same people who have been wrong more times than they were right over and over again. The best analyst is Larry Murphy, the real estate analyst that I pay no attention to is Dennis Smith and unfortunately others do.

The reason that he is often wrong is due to fact that he GUESSES, rather than using relevant data to calculate results. Check out the following paragraph from his interview with the Las Vegas Sun today. In order to predict the future of the Las Vegas housing market, it is imperative to have a good estimate of shadow inventory of unsold foreclosure homes and this guy is GUESSING the number.

“How is there a lack of foreclosures on the market? Reporter

“The indication now is all that silent inventory that we have all heard talked about — my guess from 25,000 to 35,000 — the banks are holding them back and not going through foreclosure. They don’t want to see a sudden decline in prices. They want to see a consistency. They don’t want to hurt their numbers. I would rather take the hit and get it over with and move on. Then, it won’t drag out as long.” Dennis Smith.

I like to know what his GUESSES are based on. What this guy says negatively influences the Las Vegas housing market and the lives of distressed Las Vegas Realtors and commercial real estate agents, this is the reason that I am using his name in this post and decided to go after him a bit.

The reason that he is Guessing is that he is not aware of the formula to calculate the number or finding relevant data to do so. The links below are tutorial for Mr. Smith.

 About Las Vegas Trustee Sale Auction and Las Vegas shadow home inventory Part-1 of 3

About Las Vegas Trustee Sale Auction and Las Vegas shadow home inventory Part-2 of 3

About Las Vegas Trustee Sale Auction and Las Vegas shadow home inventory Part-2.75 of 3

About Las Vegas Trustee Sale Auction and Las Vegas shadow home inventory Part-3 of 3

I would like to see Mr. Smith prove what he says about the unsold inventory of homes that banks are holding back. It is his job to collect and correlate the data and use mathematical formulas to arrive at a correct answer, just as I have shown. GUESSING doesn’t cut it.

For a kicker, I have never heard that a reporter would ask these people to prove their baseless assertions. This is the reason that I keep writing: don’t make a real estate decision based on news paper articles, they are worthless.

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As you can see HOA fees at these communities pool subdivisions can be as low as subdivisions without a pool.

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The other and much more important reason is children drowning in private pools and the best way to avoid this is NOT to have a pool at home. For these buyers, buying a home in a community with a pool is the best possible solution and many buyers neglect this.

Retirees who relocate to Las Vegas, Henderson and North Las Vegas may find amenities such as community pool and spa, club house and exercise rooms. The upside of using the amenities is getting a big pool and not having to maintain it. The other advantage is that you can meet your neighbors and be social.

List of North Las Vegas home communities (subdivisions) with community pools, other amenities and HOA Fees

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I will continue the list of Las Vegas subdivisions with community pools and other amenities next.

Comparing Las Vegas new homes for sale and resale homes in the same community

A gentleman called me buying a high rise condominium in Las Vegas; while we were talking he told me that he is losing tens of thousands of dollars on a home that he purchased about a year and half ago. I told him that it is impossible to lose that much money unless you try, and it turns out that he ordered a brand new home from scratch and paid for upgrades in the Whitney area of Henderson. As soon as he moved into his home, it became a used home and other resale homes, including foreclosure homes and short sales become COMPS for his home and thus the loss.

I wrote about the two brand new Summerlin model homes for sale and now will discuss two similar one story homes that listed in the Las Vegas MLS. One is a resale which is in very good condition, one is a foreclosed home which has failed to sell through the Las Vegas MLS and is going to be auctioned off, and the last one is a short sale home in very good condition.

I will reproduce the table here

Price per square foot for Las Vegas new homes for sale in Summerlin, traditional sale, bank owned home that will be auctioned off and short sale

Although the resale homes are older than the new homes, homes up to five years old are considered new homes; the difference is upgrades and maybe an Energy Star package.

Custom paint, flooring, cabinets of Las Vegas brand new model homes for sale

Price comparison for new homes, foreclosed auction home, a traditional sale and short sale home

As you can see the new model homes are priced more than $50,000 higher than the resale homes, but the new model home buyer will have one of the most upgraded homes in the community, and pay for it too. The best deals would be the 2002 home which failed to sell through Las Vegas MLS and will NOT bring anything close to the asking price at the Las Vegas foreclosure real estate auction. The auction home has to have some work done; at the minimum the carpets got to go. Replacing carpet with carpet doesn’t add value to the home, but installing laminated wood flooring would and it costs about $10-$15K.

Living room of foreclosed (bank owned) Summerlin, Las Vegas home which is scheduled to run in a Las Vegas real estate auction

Two reasons contributed to the failure of the auction home to sell through the Las Vegas MLS while it was listed:

1: Inappropriate pricing: the auction home was listed at $124 per square foot, while the COMPS are at $110-$118 per square foot and the condition of the home didn’t warrant the discrepancy, this home should have been priced at the lower range.

2: The house was not upgraded enough for the location and price range.

Carpet is the first thing that needs changed in the Las Vegas auction home

Upgrading the resales will not be cheap and those who want to live in a highly upgraded home are better off buying the new model homes.

Even though the short sale home is nice and upgraded, it doesn’t give enough incentive to the buyer to go through the long and uncertain short sale process as this home is not an approved short sale. Even if the short sale is approved at the offer price, the seller may back out and they frequently do over specific performance demand from the lender which allows the lender to go after the borrower’s other assets to satisfy the difference between the net money to the bank and the mortgage amount.

I will not know what will happen to these homes immediately; but when I do, it will make for a cool follow up blog. But I believe that I got the point across and it is: New home buyers should do their due diligence and research their other options before buying a new home or condo in Las Vegas.

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Median prices for Las Vegas, Henderson and North Las Vegas new homes for sale is about $190,000 while the median price for Las Vegas resale homes, including bank owned (foreclosure) homes, short sales and regular sales is about $126,000.

Two brand new model homes are for sale at Kingwood subdivision in Summerlin which is a Las Vegas master planned community. Las Vegas new home builders build model homes on the best parcels and highly upgrade them to entice buyers. Upgrades for model homes that are shown to perspective buyers can run as much as $50K-$100K. However most new home buyers do not add so much upgrades to the homes that they order and the end product looks different from the model home, thus we ask the sales staff at new home builder’s sales offices to show inventory or nearly finished homes to our clients.

Las Vegas new home builder’s model homes are highly upgraded; see the hardwood flooring in the entrance

Although model homes are poor choices to do a comparison between new and resale homes the builder is not charging full price for the upgrades on these homes. Please see base price and asking prices for the two Summerlin new model homes.

Summerlin Model new homes for sale by R/S Development

There are two highly upgraded model homes for sale in Summerlin, brand new one story homes for sale are hard to find in Summerlin and R/S Development is selling out. The asking price for these 1647 and 1769 square foot new homes are priced at $159/SF and $163/SF respectively. Clark County Assessor has erroneously included the garage space in the square footage of one of the homes and shows it as 2085 square foot, mistakes happen.

New home builders in Las Vegas now include upgrades such as granite countertops in the kitchen island, Energy Star Appliances and other upgrades. These compete better with re-sales such as bank owned Las Vegas homes or even auction homes since many of them have not been highly upgraded.

Dining Room of a Las Vegas new model home, furniture and appliances can be purchased for $10,000

As I have previously written, ordering a new Las Vegas home from scratch is the least cost effective way to buy a home in Las Vegas, however it allows the buyer to live in a brand new home that is built to their taste and enjoy the warranties which are provided by the Las Vegas builder such as one year bumper to bumper warranty and 10 year structural warranty.

If a buyer is dead set on buying a new home, then they should see if they can buy an inventory home since they still get to choose some upgrades such as flooring, etc and save thousands of dollars in the form of instant equity if compared to other new homes in the same subdivision, as new homes that need financing have to appraise. By the way, look at the base price for the new homes which I discussed and the current selling price. The builder is not charging full price for the upgrades because these brand new model homes are inventory homes after all.