BluefoxToday blog : Las Vegas real estate values rise thanks to Washington

Las Vegas real estate values rise thanks to Washington

Living roomHousing prices have been in a free fall in most sectors of the nation for a long while, much longer than any real estate expert had predicted. When mortgage financing is hard to come by and supply far outpaces demand that's usually what will follow. The weak economy is also a major contributor to this. Lately, though, prices have begun to stabilize across the colorful map.

Southern Nevada - Las Vegas, Henderson, Green Valley, Summerlin, Southern Highlands, Pahrump, Mountains Edge and Mesquite among its communities - is a good example of that. The lower end of the marketplace is rather busy here as investors and first-time home buyers do their thing and pick up bargain properties. The statistics are somewhat slanted because of the proportionally high impact of this particular segment. The mid-range and upper end in Las Vegas are still quite soft due to lack of demand, as expected, and difficulties in securing home loan approvals.

In a housing study Goldman Sachs just published it says that home prices have been nationally steered higher by 5% on average on account of government incentives and interventions.The number can be debated until mouths foam, but the fact right now is that Washington is largely making the housing market what it is. Mortgage money is kept affordable by the Fed buying just about everything that has a mortgage bond stamp on it. Then there are all these home loan modification and rescue plans, with eye-catching acronyms, that most consumers are liable to lose track of. But regardless, they at least slow down the supply of homes being foreclosed and dropped on the already saturated marketplace. The first-time home buyer tax credit has given a nice boost to the demand side. And by the way, it looks as if a similar program will come out of Congress in a little bit to replace it.  

Las Vegas metropolitan area - as are many other markets throughout - is still grappling with many challenges in the mortgage and real estate arenas. It would be in much worse shape, though, without Uncle Sam's charity and efforts. Eventually it has to stand on its own again, and it will. It's already taking some wobbly steps using crutches toward that goal, but obviously needs more time to fully recover.  

Photo by RyanGWU82

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Provided by: 

Esko Kiuru
Mortgage, real estate and apartment industry analyst 

www.BluefoxToday.com - syndicated mortgage, housing and property management blog

eskokiuru@gmail.com
My cell: 702-499-1006

Comment balloon 6 commentsEsko Kiuru • October 26 2009 07:00PM

Comments

Esko, I am glad to hear that those billions of dollars are having a positive affect somewhere.  I hope that see more positive results.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) about 9 years ago

George,

Predictably this market maker will soon shrink from its present role.

Posted by Esko Kiuru about 9 years ago

I am finding it is easier for a buyer to go the route of short sales to get seller paid concessions in this market.  REO, forgetaboutit!

Posted by Renée Donohue~Home Photography, Western Michigan Real Estate Photographer (Savvy Home Pix) about 9 years ago

Esko,

There was one particular section of this post I found particularly interesting:

"Lately, though, prices have begun to stabilize across the colorful map."

"Southern Nevada - Las Vegas, Henderson, Green Valley, Summerlin, Southern Highlands, Pahrump, Mountains Edge and Mesquite among its communities - is a good example of that. The lower end of the marketplace is rather busy here as investors and first-time home buyers do their thing and pick up bargain properties. The statistics are somewhat slanted because of the proportionally high impact of this particular segment. The mid-range and upper end in Las Vegas are still quite soft due to lack of demand, as expected, and difficulties in securing home loan approvals."

So you're saying that the increased (or extra) activity is Southern Nevada is propelling the home price stabilization? Are the statistics slanted more towards the good or the bad?

By the sounds of it, first-time buyers are playing a significant role is S. Nevada's recovery. Did you read any specifics about the tax credit's extension? It's all still speculative, but if you're interested, check out: "http://www.cnbc.com/id/33506105?__source=RSS*blog*&par=RSS"

Nice post,

Tim

Posted by Tim Manni about 9 years ago

Renee,

That's a nice piece of info for buyers.

Posted by Esko Kiuru about 9 years ago

Tim,

Most of the sales now take place in the lower end of the market, so the stats reflect that. Prices here are actually going up a little in that market segment. Las Vegas stats don't necessarily tell the full story, since the mid-range and upper end show relatively little activity, so their numbers have only a marginal effect. Tax credit's extension will likely happen, probably in a somewhat different shape than the expiring one.

Posted by Esko Kiuru about 9 years ago

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