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StumbleCash deals make up half of Las Vegas home sales
Wednesday, Feb. 24, 2010 | 1:31 p.m.
Sun Coverage
Cash continues to be king when it comes to buying a home in Las Vegas.
Research firm MDA DataQuick reported that cash buyers accounted for 50 percent of all home purchases in January, up from 39 percent in January 2009.
Investors and second-home buyers comprised 43 percent of the home purchases in January, up from 34 percent in January 2009, the firm reported. The median price paid in the all-cash deals in January was $96,000.
Overall, investors and second-home buyers paid a median price of $101,000 for their homes, down from $109,836 in December and $125,000 in January 2009, said DataQuick spokesman Andrew LePage.
A strong demand for condos and homes priced under $200,000 pushed January’s sales of new and existing homes to 3,367, the most since January 2007, the firm reported. The sales of homes priced below $200,000 made up 79 percent of sales compared to 66 percent in January 2009.
In the existing home market, the 3,092 sales, while down 35 percent from December, were 7 percent higher than January 2009 and the most since 3,405 in January 2006. Sales of existing homes have risen year-over-year for 21 straight months, LePage said.
Sales of new homes, including condos and condo conversions, fell to 275 in January, down 54 percent from December but 10 percent higher than January 2009. It was the second-slowest January for new-home sales since 1994, LePage said.
The median price paid for all new and existing homes sold in January was $125,750, down 2.5 percent from $129,000 in December and down 21 percent from $159,000 in January 2009.
The overall median price has fallen year-over-year for 33 consecutive months and in January was 59.7 percent below its peak of $312,000 in June 2006, LePage said.
The median price paid for existing single-family homes in January held at $135,000, the same as it had been since October.
The median price paid in January for existing condos was $69,000, which is in the same range over the last nine months. The median price is 66 percent below its peak of $203,000 in July 2006, LePage said.
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Prices will still be going down, most people are holding out still..
This is more evidence of (hopefully) smart money buyers believing in the long-term future of investing in Southern Nevada real estate.
We havn't hit bottom yet...
Seriously, I hate these investors and second home buyers. Four houses in my parents neighborhood got snatched from underneath me I had bids on due to them paying in cash, all investors. I'm trying to move closer to family, and every single time I'm pushed out of my bid by all cash offers. I qualified, I put in interest, and the next day sorry sir the home has a cash buyer. It's absolutely frustrating, even more so when they leave the homes empty, or remodel them only to put a for rent sign with astronomical rent leaving the house perma-empty.
Cash sales equals investors endlessly flipping houses back & forth to each other like a game of catch.
Wait till the tax credit ends and all of these investors will want to dump their properties. Prices will drop further.
this is not a correct story nor are the figures correct, the market is down and still going down house sales are dropping rapidily you only need to check the official data from the state to see this...
they take houses off the market as if they have been sold, then place them back on a few months later, also there are many more foreclosures waiting to appear..
And this helps me - how????
Cash buyers = Investor = Section 8 rentals = Ghetto's. I cant believe I seem like the only one that sees this! Anyone follow me? Or am I alone?
Brian-D i follow your logic and agree that the investors will rent out to section-8 tenants and wait for prices to go up before selling.
"This is more evidence of (hopefully) smart money buyers believing in the long-term future of investing in Southern Nevada real estate."
GM
SEE Brian_D's post above. That scenario is more likely then "smart money buyers" "Believing" in investing in Southern Nevada.
As an investor, we, personally, buy and hold, not flip. Rentals are necessary, especially for all the homeowners who lost their homes in this mess we are in. Investors are not looking to screw up the market, as the lame assume, in fact they are part of the solution, in many cases. How hard would the market be dropping if investors weren't buying, since they account for over 40% of the buyers? Some, such as us, do not do Section 8. And finally, if you really think that the investors qualify for any tax credit or incentives available, you are sadly mistaken. Some investors are salvaging what is left in our investment and retirement accounts, banking that the housing market is safer than Wall Street. Instead of being a hater of successful investors, try talking to some! You may be able to learn how real people invest their hard earned money!
New home sales fell 11% in January. "the lowest level on records going back nearly a half century. The big drop was a surprise to economists who were expecting a 5 percent increase over December's pace."
http://finance.yahoo.com/news/New-home-s...
Fannie Mae & Freddie Mac are going to need more money and probably won't be able to repay it.
http://finance.yahoo.com/news/Bernanke-s...
Option-Arms & Alt-A loans are going to reset well into 2012. That's about $1.5 TRILLION of bad paper. Half of that is going to fail. Very likely 70% of those loans will fail. That's going to be another TRILLION dollars crashing on Wall Street as these loans are securities traded on Wall Street.
So... You want to invest in housing and real estate? You better be able to hold it for a long time. It probably won't get rented due to unemployment being so high and you can go to www.bls.gov to see that it will take at LEAST four-years for it to get back down to 5%.
I wouldn't call the housing market a "safe" investment ANYWHERE until 3rd Quarter 2012. That's when the housing market will hit it's true bottom. Why then? Because all these bad loans (Subprime/Alt-A/Option-Arm) will be purged from the system. THEN you can get back in when prices have bottomed out.
I wouldn't touch real estate with your money, my money, or anyone else's money until late 2012. You want to get in now to use $8,000 from the government? Go ahead. You could wait 1-year and save $20,000 as prices drop even further down.
lvdjlv you hit the nail on the head. Don't go near Real Estate till late 2012. And by the way, I am a Real Estate Agent too.
Thank You LVOWNER. Its nice to read something from someone who knows what they are talking about. The LOSERS who post on this site everyday are disgruntled A-HOLES who stopped paying on their homes because they didn't want to lose money which is why we are in this mess in the first place. These are the same people that lose all their money in the casinos and complain that the slots are too tight and they can't get comps for a silly buffet!!! PLEASE MOVE TO ANOTHER CITY AND COMPLAIN ABOUT THEM AND LEAVE THOSE OF US THAT ARE PROUD TO BE LAS VEGANS ALONE!!! As far as I'm concerned you people are only qualified to clean up puddles in the porn theatre!!
AH! THE AMERICAN DREAM TAKES A DETOUR.
Wonder if dollar loan ctr will give me a loan for a house
I am less than a week away from closing on a short sale. The property listed for $94,500 and I offered $110,000. The bank passed on the cash sale which was $92,000 and took my offer. The house appraised for only $100,500, so I had to pay the difference up front in cash to get the loan. Bottom line, if you offer significantly more than the value of the home you are trying to buy, you can get it, even if you are financing. Banks are trying to lose as little as possible so make it worthwhile for them.
These cash deals will dry up soon enough and a new wave of price drops will hit. The investors aren't bringing any job growth which will support home prices in the long run. Job growth is what created all the homes to begin with. No jobs= depressed home values. Look no further than Detroit, it's that simple.
denver21
YOU are the prime example of someone who doesn't know what he is talking about. WHO is the loser here? Your post is filled with nonintelligent comments about what YOU think is happening. Obviously, you have your head in the sand (and that is saying it nicely).
Yeah - people lost their homes because of...what is that you say - gambling???? Had nothing to do with that 15% unemployment rate.
PS LVOWNER makes good points and I'm sure there are investors like him in the Valley and that is good but somehow I th ink those are far and few between, but just judging from what has happened in the past with the investors - you can't blame the negative comments from those who know and understand the ramifications of all the Section 8 housing that came from the "investor boom" of 2005-2007. Many of those investors started the foreclosure crisis Vegas is in today. Many bailed when they realized the housing values started to take a nosedive and "walked". A LOT of people in the Valley were "burned" from that last investor go 'round for obvious reasons - from tenants in the homes not knowing what a broom is and wouldn't know a broken window blind from the trash can to "crack houses" springing up in good communities. Again - get your head out of your (fill in the blank) denver21 and drive around some of the what used to be nice neighorhoods in the Valley.
And this is with the government holding interest rates at unsustainable lows, AND buying up distressed properties to turn them into "low-income housing". Remove all the government shenanigans, and you chop another 50% off of today's prices, easily. Just bumping the mortgage interest rate up to 7.5% would equal a better than 50% increase in monthly payments - can ANYONE afford that? I doubt it. We are NOWHERE near the bottom. The yutzes paying with cash are going to learn a valuable lesson in GREED CONTROL.
I have to wonder where people (in this day and age) get cash to buy a home. Dope money? Money you got from some other government slop trough? Surely no one is stupid enough to invest in real estate unless they are going to clean-up on section 8 money. Who are you trying to kid? I've seen brand new neighborhoods (the schools are ravaged by criminal behavior, area businesses are ripped-off, and police officers murdered in their own garage) totally devastated.Don't tell me cash buyers are "good" for any one but the hog that cleans-up on the misery of others.
I can see buying a property as a second home, but buying for the purposes of renting is suspect. People have been losing jobs. Unemployed construction workers will not see work in LV for a very long time, casinos will have a downsized workforce for for quite sometime, and the commercial businesses that service the LV residents will have to downsize accordingly. Taking a smaller LV population into account, it would seem to me that there are more homes than people to fill them. If investors use them for personal use then no problem and it does help stabilize the housing market. But if they intend to rent, they will be competing with all of the other investors who have the same plan. Investors in the end may have to lower their standards by renting to people with spotty credit, renters whose business is in the underground economy, or section 8 participants. Neighborhoods will suffer the consequences of having these types as residents.
We were all cash buyers. We now have been full time LV residents since mid 2009. We love Vegas and have spent tons of money to upgrade our place, remodel and support the local community, support charitable causes. There is alot of negativity on the list serve but given the economy some of its understood. Fact is if everyone keeps trashing the city you are right it might fail. What good does that do? What happened to expect the worse but hope for the best. The end of the world sentiment is pathetic. The economy has crashed here before. Also I remember the double digit unemployment and 16% loan rates in the early 1980s. Things will turn around.
The one thing I have learned from this thread is Section 8 Renters = Trouble. Thanks for the data.
denver21=sgt.rock=
"We were all cash buyers. We now have been full time LV residents since mid 2009. We love Vegas and have spent tons of money to upgrade our place, remodel and support the local community, support charitable causes"
Well, that's nice. But most on here have lived in Vegas WAY LONGER than since last year and have put "tons of money" in homes worth half of what they paid for them. How long will you REALLY live here? Until the house you bought sees a 50% appreciation and then it goes back on the market and you go back from where you came?
Thank you anyway for supporting Las Vegas....but will you be here 10 years from now?
We own seven houses in a different state which we rent. Got into them to legally avoid paying tax after the highway department took some property from us. I agree with the people who are doubtful about the future of rental housing. We've probably made 6% to 7% a year on average on a cash basis over the past ten years. But I've spent countless hours improving property, dealing with tenants, etcetera. Prices would have to drop a lot--or rents would have to go up a lot--to entice me into buying again.