My New Outside Blog: www.lasvegasmtg.com Report: Is Las Vegas housing inventory rising due to declining sales?

www.lasvegasmtg.com Report: Is Las Vegas housing inventory rising due to declining sales?

Realtors and Las Vegas Inventory Reportwww.lasvegasmtg.com Report: Is Las Vegas housing inventory rising due to declining sales? The Greater Las Vegas Realtors and Applied Science has reported that Las Vegas housing inventory has been increasing weekly at a pace of 280 homes per week since late April. The housing inventory in Las Vegas has increased to 14,854 a 4,800 increase in four months.

Current housing inventory has increased by 20% over last year withvacant or tenant occupied properties representing 80% of the standing inventory.  Contingent sales that are currently pending, 80% are short sales that require the banks approval. The Short Sale process is slow and tedious with a success rate of only 25% in  actual closing.

Las Vegas inventory Market Data

Hud Secretary Shaun DonovanIn a recent article about the concerns HUD Secretary Shaun Donovanhad about declining sales nationally of existing home sales since the First time Home Buyer Tax Credit had expired in April 30th we are seeing the same statistics in Las Vegas. Las Vegas has seen a decline over last year mirroring the west coast numbers of 31% decline in pending sales.

With rates as low as they have been in a half a century and housing prices at 1980 levels a slowing of sales and higher inventory does not paint a rosy picture for a recovery for our Las Vegas Housing Maket relatively soon.  If the Federal government re-instates the Tax Credit will we see another spurt of buyers interest only to slow after it is removed?

It is only speculation on my part but the increase in inventory might be the release of shadow inventory we have heard, about but did not see in listings. If this is true, the release of more inventory while consumer demand is slowing is not a positive outlook for home prices stabilizing in Las Vegas for the short term. What is your opinion?    

         Kenny Salame                                                                                                  Equal Housing

Kenny Salame
Senior Loan Officer
All Western Mortgage Inc.
8345 W. Sunset Rd.
Suite 380
Las Vegas, NV, 89113
US                            
Mobile: 702--506-3301
Direct: 702-947-0609
Office: 702-369-0905
Fax: 702-952-0887
ksalame@allwesterm.com
 
 
 
 
 
 
Comment balloon 9 commentsKenny Salame • September 04 2010 12:34PM

Comments

John:  I am 99.9% sure it is due to exhausted pent up demand from first time buyers due to the tax credit.  I wrote about this last night too :)  I checked GLVAR's website and the amount of new listings hasn't gone through the roof, in fact July's numbers were lower than 2006-2009 so the shadow inventory fairy has not paid us a visit yet.  Most of my buyers are now investors.  I am only working with one first time buyer at the moment and he has CHOICES!

Posted by Renée Donohue, Las Vegas Real Estate Broker - www.urLVhome.com (Savvy Home Strategies Realty, LLC-REALTOR®-Estate-Probate) about 8 years ago

Wow! Those are very staggering statistics. We also have a challenged market in la Quinta, California, but not that many short sales. I believe our short sales are about 40% of the market. It sounds like your market is flushing out quickly. Hopefully soon, real estate industry will be easier again and more profitable too.

Posted by Lori Bowers, The Lori Bowers Group about 8 years ago

Sounds like future price declines are in store for Las Vegas.  I remember asking one of NAR's economists if the multiplier effect worked in reverse (since they used to say that every new job created 3-7 new jobs).  He said no one has ever paid for that study so he couldn't answer it definitively but it made sense that it would work in reverse.

As far as shadow inventory, one of the heads of a major bank had the best answer I had ever heard on that so I will paraphrase "If prices are declining, why would we want to hold inventory in the shadows to only sell it in the future for less?"

Here in Boise, Idaho; I have seen the banks expedite their time frames from foreclosure to listing and have had Fannie Mae take less than a month to relist properties.

Posted by Jim Paulson, Owner,Broker (Progressive Realty (Boise Idaho) www.Progressive-Realty.info) about 8 years ago

Renee You may be correct that it is due to First time buyers slowing demand. For me that is not the case right now.  I have 5 First time buyers, 3 move up home buyers, and 2 second home buyers under contract in my pipeline.  I have 5 clients all ready approved that are shopping for homes now. Least they have more to look at. Good luck.

Posted by Kenny Salame, NMLS ID 313873 (All Western Mortgage Broker # 14210) about 8 years ago

I had to ask since I am not from your area, what is:  Greater Las Vegas Realtors and Applied Science?  Is that two separate organizations?

Posted by Jim Paulson, Owner,Broker (Progressive Realty (Boise Idaho) www.Progressive-Realty.info) about 8 years ago

Lorie thanks for the comment. We are flush with short sales, but it is hard to keep the buyers interest while the banks take forever to decide if the will accept the offer. With so much of the Short Sales owned by B of A does not help to move things forward in a timely manner.

Posted by Kenny Salame, NMLS ID 313873 (All Western Mortgage Broker # 14210) about 8 years ago

Jim,

I know it does not make sense to hold inventory, but in Las Vegas we have had more foreclosures then sales + the inventory. It does not add up so that is why I feel there is a shadow inventory. If you go in certain neighborhoods you will see vacant homes with no for sale signs at all. About two months ago I was at a open house in a starter home development and there was 8 homes on each side of the block with only five occupied homes. There were only two vacant homes with for sale signs.

Greater Las Vegas Realtors is a Realtor Association that Realtors join as members to help promote and represent Realtors. Applied Science is a data tracking service for Real Estate. I'm not sure if this is a national service or confined to local areas.

Posted by Kenny Salame, NMLS ID 313873 (All Western Mortgage Broker # 14210) about 8 years ago

John:  I should have clarified that the investors were "all cash".  Our all cash closed terms went up three percent in July and I am waiting on the slow pokes to close the inventory to see where we ended up in August!  Last year this time I had 50 % financed to 50% cash and today I have about 75% cash to 25% financed (only choose to work with a handful of buyers at a time.)  Cash purchasers are prelavent in our market right now!

Posted by Renée Donohue, Las Vegas Real Estate Broker - www.urLVhome.com (Savvy Home Strategies Realty, LLC-REALTOR®-Estate-Probate) about 8 years ago

Renee Cash is King!

Posted by Kenny Salame, NMLS ID 313873 (All Western Mortgage Broker # 14210) about 8 years ago

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