The majority of people I have come into contact with ask me if I believe it is a "good" time to buy right now in the Las Vegas Real Estate Market. I have realized by some of the conversation that has been generated by this topic that a lot of folks have a misconception of the current real estate market. I understand that there is a plethora of information disseminated amongst people within the industry, the media and consumers that I feel is conflicting or not as accurate as what I see on an everyday basis. I am writing this blog posting to provide my clients (and other individuals that may be interested) on my perception of the Las Vegas Real Estate Market.

To begin, let's lay some ground work - this summer Las Vegas hit some pretty impressive numbers when it came to having an all time high record of the amount of homes sold in a month, topping out at roughly 4,700 in June which broke the previous record of 4,414 homes sold in June of 2004 during the "boom" (per the Las Vegas Review Journal). Las Vegas is still one of the highest regions hit by foreclosures (which primarily what is most people are aware of via the media); however, the available listing inventory is shrinking (because the banks that own the foreclosures are not immediately placing the homes back on the market and are keeping them in their inventory). From what I see in the market, most homes that are in good condition and priced competitively, are selling within 2 to 10 days. In almost all situations I see, if a buyer is interested in writing an offer on a property, they will be in competition with multiple other buyers (anywhere from 1 to 20 and maybe more). Home values are also showing signs of stabilization. Considering that the buyers (or demand) are keeping up with the listings (or supply) and the values are stabilizing, some local analysts are reporting that Las Vegas Real Estate values have hit the "bottom."

 

Moving on, most people don't take into consideration that the economy has seasons. Just like we have spring, summer, fall and winter every year, the economy also has growing and declining seasons (or what I will refer to as cycles). What strikes me as the most interesting thing about these cycles is that most people tend to react to the market based on what everyone else is doing. If a person buys at the top of the market, there is the lowest chance for opportunity and the highest degree of risk. On the other hand, if a person buys at the bottom or near the bottom, there is a higher opportunity for an increase in value with lower risk of loss.

Below is a diagram (complements of Pat Zaby, CRS) that depicts the emotions that commonly coincide with market trends.  

Currently, I feel as if there is a huge window of opportunity that one could currently take advantage of. In addition to the opportunity with the "bottoming" out of the real estate market, home values are still low (and I might add, the most affordable they have been in years), inventory is tremendous (especially with the bank owned properties that continue to hit the market on a daily basis), and interest rates are at historical lows (the lowest they have been since the 1950s)! If you happen to be a first time home buyer (which constitutes as not owning a home in the last 3 years) and fit the income requirements set forth by the IRS, there is also the First Time Home Buyer's Tax Credit - which is currently at $8,000 and set to expire on November 30th.

I have stated many facts that contribute to a great time to buy NOW, but let me take a moment to consider other valuable factors that contribute to people buying a home...

• Home ownership is part of the American dream.
• Many people buy homes to have control of where they live, how much they pay, and the condition of the property.
• Most people consider their home to be their largest investment due to increasing values and the amortization of their mortgages.
• Three out of four people say that pride of ownership is an important reason for buying.
• Almost 70% of people didn't like the concept of "paying rent" and getting nothing but a place to live for it.
• People like to be able to control and modify the feature of a home.
• More than 50% of renters associate settling down to purchasing a home.
• Home ownership continues to be the largest single source of savings for U.S. households.
• Most renters say that the sacrifice made to be able to purchase a home is worth it.
• The equity in a home can be accessed, with good credit, and used for any reason such as education, medical, or starting a business.
• Homes have continued to appreciate in value over the long term and are considered to be good investments.

I would like to close with a quote from François de la Rochefoucauld, "The only thing constant in life is change." All too often opportunity looks us in the eye and we are not paying attention enough to take advantage. The interest rates that we are seeing today will not continue to last - they are superficially low. The home values that we are seeing today will not last either. There are many great reasons to buy a home now but at the end of the day the only reason to start looking is if you are ready for home ownership. If you think you are ready or would like to discuss your particular situation, please feel free to call me. I would be grateful for the opportunity to meet with you and discuss your options.

Be blessed...

Kristine