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placesinlasvegas.com - Visit Our Las Vegas Valley : Free Information, Blogs, Tips, Coupon Sites, Relocation Assistance, & More. Come to Play!   Decide to Stay!  Call 702-222-0815

Las Vegas Real Estate: Where did all the houses go?

Perhaps you’ve been driving around looking at the condition of the Las Vegas valley.  If so, you’ve probably noticed that many new home builders have increased production substantially and are advertising their developments much more ferociously than they had been doing the last few years, correct?  You may also have noticed that a few commercial complexes are popping up here and there and some infrastructure is being added to the previously halted road construction projects throughout the city, but especially the south side and northwest corner.  How about downtown?  Did you notice that many of the older commercial areas off Las Vegas Blvd have been either knocked down or shut down and fenced off with steel mesh fencing?  Did you notice the freeway signs scattered throughout the city stenciled “Zappos” adopted highway?  During your escapades about, did you happen to notice the lack of residential home signs out there in people’s yards?  I wrote a blog almost two years ago titled Las Vegas Globalization.  It was a monster of a blog, coming in at 10+ pages, and I sincerely thank the one or two people who graced their eyes on it to the end.   Although it was long and dull to most, so far, it’s well worth the read, as, everything I’ve listed above, and more, I already predicted would happen, has happened, almost to the number.

This blog is dedicated to describing these tell tale signs of upcoming growth and exposing them for what they truly are, our government’s attempt to falsely inflate everything to appear much more stable than we really are.  Everyone knows that this is election year.  The last thing politicians, both Democrats and Republicans alike, want before new voters casting their ballots in November is the open existence of a stalled and stale economy which has remained throughout the last four years.  Did you know that there are still an estimated 100,000 properties alone in the Las Vegas valley that have missed payments and are in danger of foreclosing?  Yet we have barely 4,500 single family homes currently listed for sale on the available retail market, very few new properties being listed each day, and more than 3,000  properties (all types) a month being purchased by a frenzy of buyers continuously multiple bidding nearly every listing out there.  Top put that into perspective, those shortages of numbers are almost what they were during the crazy boom we had in 2004-2006 where people were bidding 10%-20% over listed prices and writing offers on car hoods so they could run back in the properties and present to the owner before the owner picked from a line of other offers.

Why does this shortage exist currently?  The largest reason is a law called AB284.  This was a law passed by our state government last year in October of 2011.  I encourage you to look it up for exact details, but, basically, this law forces banks to have all the necessary paperwork in order before proceeding to foreclose on a property (imagine that, they didn’t track it too well before, apparently, as there are estimates of several hundred to several thousand illegal foreclosures just here in the city) and then, if a property owner wants to work with the bank instead of foreclosing, the bank is encouraged to assist the property owner with a short-sale or loan modification.  Furthermore, the bank, in most cases, cannot place a new Notice of Default (a Notice of Default is the first legal step in the foreclosure process approximately 90 days of missed payments) against a property until all avenues of resolution, outside of foreclosure, have been exhausted.  Sounds like a good deal, right?  Wrong.  You see, the banks restrict loan modifications to a 2% interest rate on the remaining loan balance in 99% of all cases out there.  Principle modifications are unicorns, not just unicorns, but purple unicorns in velvet.   Here’s the problem with that, Las Vegas real estate has fallen more than 60% since 2006 so the remaining balance on many loans still offers a payment greater than what rent would be on the same property and stiffs the owner with an access of 40% debt on their loan so most loan modifications will never go to completion, but rather, they are used as a stall method by the homeowner to remain in the property for free (it’s important to note, because few Notice of Defaults are filed, the homeowner may actually want out, but may be stuck in the home) and they are actually liked by the banks as this stall tactic is stalling new inventory from hitting a buyer frenzied market that has falsely now increased in price 10% in most neighborhoods to as much as 30% in some neighborhoods since last Christmas.  So the question becomes can this go on?  The answer is YES it can, not inevitably of course, but until the game of musical chairs stops its music again just like it did in 2007 and the market crashes again.  You see our state legislators are not even convening until February 2013.  Therefore, at best case scenario, AB284 can’t be modified or overturned until the Summer of 2013 and the effects of the overturned law wouldn’t be felt until early 2014.

  So, now that I’ve disclosed these facts, I’d like to revisit the first paragraph and address this growth in new construction developments and downtown.  Because there is nearly zero move-in-condition inventory on our market, cash buyers have been snatching up most of that which is left.   This leaves normal, everyday, people who need a loan to purchase their home with no alternative than to go to the new home builders.  Hence the reason new home sales are now up almost 400% since Christmas and most builders have increased their prices by as much as 30% in that time as well forcing a loan buyer to overpay for a property if they want a nice home.  Likewise, people at the top of the food chain see this trend and, although they haven’t built yet, as many are recovering from bad business years themselves or are emerging from business bankruptcy, also the fact that the election results have not come in yet, they have taken steps to acquire land for future development which is why you are seeing so much new vacant land and steel fencing downtown.  Simply put, as always, the rich are getting richer and the poor are getting poorer… fast.  One more point of interest, how many people do you know who have gotten a raise in the last four years at their current jobs locally in Las Vegas?  If you’re a tip earner, you may notice a small increase to your paycheck, but how about the tips?  Are your tips anywhere near the same as what they were in 2007?

Furthermore, I mentioned Zappos above.  Zappos, for those who don’t know, is Zappos.com, a huge online shoe retailer that was purchased a while back by Amazon.com for 500+ million dollars.  The CEO of Zappos is Tony Hsiech and he is hailed for being responsible for the revitalization of downtown San Fransico a few years back.  Zappos headquarters was in Henderson, but, very early in the year, Mr. Hsiech moved his operation to downtown Las Vegas, where he has publically pledged to help revitalize downtown along with our mayor, previous mayor, and a few other influential figures throughout the city.  As you can see by the first hand growth of the new city hall, revitalization of some downtown businesses, and First Friday growth from what started as a few hundred people a few years ago to what is now thousands of people, they are having some good successes.

So, what shall be the ending of this blog?  I guess what I’d really like to convey to a reader, who fought this far, is that, whether it’s false growth or real growth, knowing when the music stops in the game of economic musical chairs is far more important than debating what’s real and what is not.  I saw a lot of people make A LOT of money flipping houses this spring.   I was even involved in a few successful ventures myself.  But, if flipping isn’t your thing, keep in mind, with inventory disappearing, how long before the supply of rental houses disappears as well?   Whether you are an investor or just the average person who doesn’t want to rent anymore, this should be of concern to you.  Move-in-condition properties are becoming harder and harder to find every single day and the acceptance of paying above the marked listed price is becoming a normal practice again already.  Are you starting to see a repeat of 2006 coming?  So when’s the crash again?  2017, 2018, 2020?  Maybe never, maybe our politicians will be able to convince or, at least, scare, enough people into holding onto their upside-down homes long enough to fight it off for another generation or longer.   The time to buy is now.  Act on it.

Thank you very much for reading my blog, I hope this information helped you out.  For this blog and other helpful tips and tricks please visit our tourism and real estate website http://PlacesInLasVegas.com or, for all aspects of general real estate, our parent website http://LasVegasRealEstateConnection.com.  My team offers several services; buyers, sellers, distressed sellers, renters, and property management.  Honest and truthful professionals to a fault.  Call us direct @ 702-222-0815.

 

Sincerely,

 

 

James Bellile

 

*All blogs are personally written by James.  Although we encourage and are grateful for sharing, all information is copyrighted by James and needs to be given credit.  Thank you.

Real Estate : Top 5 Tricks of the Trade to Sell Your Property Fast

#5   Make small repairs and neutralize your property! — Unless you absolutely don’t have the time or money to repair your property, even just a little bit, do it, the payoff is usually huge.  Don’t forget, when you are using your property, it’s important to make your property your own, but when it comes time to sell, make it someone else’s vision of comfortable living.   I’m not talking about remodeling for the sake of remodeling, I absolutely 100% promise you that no matter what you remodel, someone touring your property is not going to like it or many of the other items that are pre-existing, which you chose not to remodel.  People’s choices in properties are as unique as their choices in everything else in life.  The key is to make it appeal to the majority without going so far over the top that you, not only, bust your budget, but also create a bland property that everyone likes, but no one wants to purchase  because none of them feels a connection with the property due to it becoming so neutralized it now lacks a personality.  What I am saying is that if you know certain things within your property are only popular with a small fraction of the population; change those items BEFORE you place your property on the market.  Some examples are radical paint colors, a theme room dedicated for only one specified specific function like a movie theater or hobby room, and collectables and knickknacks.    Oh, and don’t forget, your children and your pets.  Buyers may or may not have children and/or pets and, even if they do, you, as a savvy seller, do not need them, as your prospective buyers, concentrating their attention on anything, but the property that you actively trying to sell.

Out of all the Top Five, point number five gets the most personal and can become quite awkward.  Let’s face it, nobody what’s to hear that their taste is, to say it politely, ‘not appealing’, but a seller NEEDS to hear it in order to get the results they desire, i.e. the most money in the shortest time on the market with the least amount of hassles.    For this, as a Seller, don’t try to determine a sour point in your property by yourself, ask your professional, as he or she is the person who should be completely detached from any emotional attachment to your property.   If you, my reader, does not think much of a Realtors opinion, perhaps we are all, “the equivalent of a shady used car salesmen,” (I actually was called this by a patron one time at an open house) then think of it this way, did you know that doctors and lawyers rarely take themselves or family members on as patients/clients.  Why?  Because they know that they will probably make mistakes due to their own emotionally clouded judgment.  Why would picking repairs and neutralizing your home to successfully sell it be any different?  Side Note:  By the way, that gentleman from the open house was shocked once I showed him my resume.  He then asked, “Why do you do this [for a profession]?”  I simply responded, “Because I not only love this job, but I know many people think the way you do and I’d like to change that.”

#4   Clean and Declutter your property! — Good God reader, you cannot imagine some of properties Realtors walk into.  Simply cleaning your property and removing most of your belongings and storing them outside of the living area you are trying to sell is important.   Buyers want to see where THEIR stuff fits together nicely within your property so they can make an educated decision if they would like to live there.  Lastly, make sure your property smells just as good as it looks; music and food can do wonders too.  Most people were given, at least, five senses with which to observe the world, make absolute sure your property appeals as well as possible to all of them as people will notice if something is missing or just ‘not quite right’.

#3  Put yourself in the Buyers shoes! — People take this for granted, but this is an absolutely crucial item a seller must understand with their property.  Ask yourself, if you were the buyer, who are you i.e. what might you do for a living, do you have a family and/or pets, what kind of active or inactive lifestyle might you live, who are the people you would associate with in your life etc…?  Next, who within this population of perspective buyers can truly afford your property?  There’s a big difference between buyers and lookers, right?  If a perspective buyer can afford it, what do they want/expect from this property? When do they want to move in or place tenants and what are some obstacles that may arise because of this time urgency (or lack thereof) that you must deal with in order to achieve your goal of selling?  Where is their stuff going to be placed or can you currently only see your stuff?  How will the buyers’ own agent maneuver to make this deal happen (think strategy)?  Is there another property that a buyer would rather buy with their hard earned money?  Remember, you want to sell high because your planning on keeping the extra money.  The buyer wants to buy low because he/she wants to do the same thing.  There are a lot of other questions you can ask yourself, but just simply think, do your best to create a WIN-WIN scenario when selling your property and, strangely, this ‘simple’ concept will usually bring Sellers the most money and least hassle too.  Follow the golden rule and it’ll make you rich… imagine that.

#2   Advertise! — If no buyers know about your property, it’s a guarantee; no buyers will ever buy your property.  Although a Realtor can help you excel with all the points on this list, this point is truly where having a Realtor on your side is really worth its’ weight in gold.  Having an experienced agent with access to a large amount of mass media and business networks is a must.

#1 The absolute #1 Thing a Seller Must Do for a Smooth Sale…   Drum Roll Please… Price Your Property Listing Right the First Time!  — Even if a property has fallen short in all the points previously and doesn’t catch perspective buyers’ eyes, somehow a suitable price tag can always make it THEE PROPERTY for them.  Now, that point of shift is different for every perspective buyer and you, as the seller, may never even consider some of the dollar amounts that would sway certain buyers, but trust me, if it doesn’t work for them, 99% of buyers will make it work at some point on that sliding dollar scale.  Don’t forget the ‘terms’ of sale as this is considered as good, sometimes better, than actual money. Strangely, however, most buyers, whether it’s courtesy to the Seller, or simply laziness, always pass up properties that are overpriced for the market and have spreads in price they foresee as being insurmountable and, thus, decide to move on without a second thought.  With this fact, Mr. or Mrs. Seller, my reader, I implore you to realize, statistically, if a home does not sell within its’ first 45 days on the market, it will not sell.  The hard truth is, it doesn’t matter if the Seller reduces the price or remodels or concedes a number of items to a perspective buyer down the road.  The bottom line is, pay attention to the market facts before you list your property.  Whether the market is going up or down it does not matter, what matters is that you understand which way it is going and are priced to where the market WILL be at the time you project your home to sell.  Never, NEVER EVER, NEVER EVER, EVER, say, “well, we’ll just place the property on the market for this [higher than market rated price] and see what will happen.”  Listen reader, if you have any desire to actually sell your property when you become a seller, if you mutter this sentence, you mine as well throw 10% out the window because that’s what’s it’s going to cost you 99.9% of the time and that’s IF you’re even lucky enough to acquire a buyer when you are chasing the market down the road.  If you like to gamble, go down to our strip here in Las Vegas and play any game you choose with the proceeds of your sale, I assure you, you’ll have multiple times better odds of winning that extra padding of price your trying to acquire than when you price your property listing too high for the market.  Lastly, it’s statistically proven that your first offer is usually the best offer you will receive the entire time your home is listed.  Therefore, you have one shot, when it comes to listing your home, do it right!

Thank you very much for reading my blog, I hope this information helped you out.  For this blog and other helpful tips and tricks please visit our tourism and real estate website http://PlacesInLasVegas.com or, for all aspects of general real estate, our parent website http://LasVegasRealEstateConnection.com.  My team offers several services; buyers, sellers, distressed sellers, renters, and property management.  Honest and truthful professionals to a fault.  Call us direct @ 702-222-0815.

 

Sincerely,

 

 

James Bellile

 

*All blogs are personally written by James.  Although we encourage and are grateful for sharing, all information is copyrighted by James and needs to be given credit.  Thank you.

 



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