Forbes: Las Vegas 8th Best Real Estate Market for Investment Now

August 11, 2008

Forbes writes:

8. Las Vegas, Nev.

Even during the height of the real estate boom from 2004 to 2006, international investors were wary of gambling in Vegas real estate. In 2006, the city was only the 16th most popular locale for international money. But since the market has turned south–and projects ranging from residential complexes to casinos and offices have suddenly stalled–international investors are starting to look for big discounts.


Here’s the full story.


USA Today: Rebound in Las Vegas

August 6, 2008

Upbeat article about Las Vegas in yesterday’s USA Today


Pow! Amazing Sales Numbers for July

August 6, 2008

I was pleasantly surprised to see the number of closed sales in July:


Compare that to June’s already strong numbers and you see a nice rate of growth.

Note that none of these are from Trump or Palms Place. This is all resale.


Home Prices Did Not Plunge 16% This Month

July 30, 2008

Case Shiller housing index numbers have been released for May 2008, and once again, the headlines tell a different story than the reality.  If you scanned a few of today’s articles you might not be blamed if you thought that home prices had plummeted 16% this past month.  The drop, of course, is versus 2007, not versus April 2008, and is old news at this point.  But some journalists, and more than a few bloggers still can’t resist casting out the old “Home Prices Plunge 16%” reader bait.

The actual Las Vegas numbers show a 2.9% decrease in average prices over the April 2008 numbers.  While the index has still not leveled off, the May numbers are a significant improvement over the drops in November ’07 through March ’08.

When looking at Case Shiller indices it’s important to remember two facts:

1.    A significant number of the home sales the index is currently measuring are foreclosures, which are skewing the indexes lower.  When these forced sales at abnormally low prices finally work themselves through the market we should expect to see the index start to rebound fairly quickly as more “normal” sales are reflected.

2.    The index lags the market very significantly.  The numbers Case Shiller calls “May ’08” are actually taken from a three month rolling average of sales for March, April, and May.  With market uncertainty at or near an all-time high, March may very well have been the real low.

-Frothing Mark

Median Sales Prices Rising

July 24, 2008

Look at the difference between the Year-over-Year comparisons and the recent trends.

The New York Times reports:

Values are dropping as well, which is cutting into many homeowners’ equity lines. The median price of a previously owned home in June was $215,100, down 6.1 percent from a year previous.

But look at the graph they printed on the same article:


Does it look like values are dropping to you? Funny, to me, it looks like values bottomed in February, and that they’ve risen in April, May, and even more (3.5%) in June.

It boggles the mind that the Times can print such misleading assessments in the face of such clear data.

Home Sales Up Again in the West

July 24, 2008

Just like last month, pending sales fell in the rest of the country, prompting headlines like “Home Sales Fell More Than Expected”. However, once again, sales were up in the West:

Sales slowed to an annual rate of 4.86 million, adjusted for seasonal variables. That follows a 2 percent increase in May. Total sales are 15.5 percent below their level in June 2007.

Only the West had higher sales, reporting a 1 percent increase. Sales declined 6.6 percent in the Northeast, 3.4 percent in the Midwest and 3.1 percent in the South

Contingent Sales, Part 2

July 23, 2008

A reader posed a very good question recently regarding the impact of contingent sales and what happens to inventory numbers when a contingent buyer is unable to sell their current home.

If a sale is contingent and the buyer’s current residence doesn’t sell then theoretically the house they had in a contingent contract should come back into inventory as an active listing.  If this were happening a lot you’d expect to see the number of contingent units dropping over time and active inventory rising over time.  While we’ve only been collecting pending and contingent data for the past few months, we’re seeing exactly the opposite so far.

Contingent sales are going up steadily, while inventory is dropping significantly.  At this point in the cycle, sellers (and their Realtors) are getting smarter.  If a buyer makes a contingent offer the sellers are going to make sure the buyer is being realistic about the price of the home they have to sell first.

Are there contingent sales out there that won’t go through?  Sure.  But the days when buyers were making contingent offers based on unrealistic expecations of the value of their homes are long over.

-Frothing Mark