Forrest’s Blog

Are You Stuck in Multiple Offers?

Let’s begin this month by taking a  look at current REO vs Short Sale Listings.

These numbers reflect a drop in available REO listings of nearly 1800 just in the past month while pendings increased by nearly 600.   Similarly available Short Sale listings dropped by nearly 500 while pendings incrased by nearly 1000.

Now we can download the April 2009 Greater Las Vegas Market Stats for Single Family Residences listed under one million dollars.  Please note the “Available Homes” count; inventory levels dropped significantly in each of the past three months even as the closings have soared.  However, the April drop in inventory is the most significant in a very long time due to the lack of REO properties coming onto the market.  REO sales still accounted for eighty percent (80%) of the April closings with another eight percent (8%) attributed to short sales.  Keep in mind that the dwindling REO inventory combined with an increasing demand for bank foreclosures has created an increased number of multiple offers on these properties.  Here is a breakdown of by price points as to how the REO properties sold in April:

April closings sold according to the following terms:

Sold Term                                       Average Sale Price

• Cash          39%                                   $107,000
• Conv         23%                                    $196,000
• FHA          31%                                    $151,000
• VA               5%                                    $183,000

Market activity and closed units soared in April to numbers we haven’t seen since August 2005 despite the fact that the average closed sales price has dropped 40% in the past twelve months.  In truth the price drops have fueled a robust resale market.  However, MLS Area Codes 402, 403, 404, 502, 505 and 602 experienced modest increases in closed sales prices.  

Isn’t it interesting that we have more short sale listings than REO listings but end up the month with 80% of GLVAR closings being attributed to REO sales and only 8% due to Short Sale closings?  The inefficiencies in processing and closing short sales continues in this market.  The short sale listing agent is the key to closing any short sale in this market.  Short sale listing agents that routinely close 90% of their short sales are remarkable in their ability to qualify the seller and then work with that client to ensure that all required documentation is provided to the bank or mortgage company in a timely manner. If you have considered becoming a short sale listing agent - you may want to seek out relevant classes such as those taught by Leslie Carver or taking the Certified Short Sale Professional certification course taught by Jan O’Brien and Steven Kitnick.  For more information on these and other courses, check out:

Americana Training Classes.

Real Estate Today is NAR’s new talk radio show hosted by Gil Gross that airs on the Internet at www.retradio.com as well as XM Radio channel 158, Sirius Channel 102 as well as podcasts. You can even receive the broadcast on your cell phone.  Real Estate Today opens doors for buyers and sellers with critical and credible information on the real estate market.  It’s fast paced and fact packed with experts, interviews, call-ins, field reports and timely market conditions.  The website maintains broadcast archives and is a great resource for researching housing market stats.

Let’s start off by downloading the March 2009 Greater Las Vegas Market Stats for Single Family Residences listed under one million dollars.  Please note the “Available Homes” count; inventory levels dropped significantly in each of the past two months even as the closings have soared.  REO sales still accounted for eighty percent (80%) of the March closings with another eight percent (8%) attributed to short sales.  March closings sold according to the following sales terms:

     Sold Term                                       Average Sale Price

• Cash          35%                                   $123,000
• Conv         27%                                    $210,000
• FHA          31%                                    $161,000
• VA               7%                                    $191,000

Market activity and closed units soared in March despite the fact that the average closed sales price has dropped 35% in the past twelve months.  In truth the price drops have fueled a robust resale market.  However, parts of Henderson (Area 606 and zipcode 89052 in particular) continue to hold their own on closed sales prices.  Average sales prices in that area remain right at $310,000.  It’s also noteworthy that area 405 saw average sales prices jump nearly $20,000 in March.

Finally, let’s take a brief look at current REO vs Short Sale Listings.

Isn’t it interesting that we have more short sale listings than REO listings but end up the month with 80% of GLVAR closings being attributed to REO sales and only 8% due to Short Sale closings?  This really showcases the terrible inefficiencies in processing and closing short sales in this market.  The short sale transaction process remains in worse shape than the Big 3 automaker’s assembly lines in Detroit!

What do parts of the Southwest of Las Vegas and parts of Henderson have in common?  The Greater Las Vegas MLS areas 505 and 606 each enjoyed closing sales prices that were higher than the previous month!  Certainly one month does not a trend make, but it is encouraging - if not exhilirating - to see even a couple of areas behaving contrary to the overall market.  As you probably know, “the light at the end of the tunnel” has been turned off due to budget cuts - but perhaps that will change as well.

So lets download my February 2009 Greater Las Vegas Market Stats for Single Family Residences listed under one million dollars.  The first item to look at is the “Available Homes” count and notice that the inventory has dropped to  its lowest level in quite a while.  Another item to view is the Average CDOM for each MLS area.  You will see some high CDOM numbers for some MLS areas; this is a reflection of the fact that we are seeing some of the older listings finally moving through the system.  Along those same lines approximately one third of all closings in February closed with an average 60 day CDOM; the remaining two thirds closed with ad average 220 day CDOM.

REO sales accounted for eighty percent (80%) of the February closings with another eight percent (8%) attributed to short sales.  February closings sold according to the following sales terms:

     Sold Term                                       Average Sale Price

• Cash          27%                                   $137,000
• Conv         31%                                    $221,000
• FHA          34%                                    $163,000
• VA               8%                                    $194,000

Market activity and closed units remain strong despite the fact that the average closed sales price has dropped 35% in the past twelve months.  That then begs the question of how effective the American Recovery and Reinvestment Act will be for Southern Nevada!  The following graphic is startling!

So, will Fiat replace GM on the Big Board of the New York Stock Exchange?  Will the Cannabis become the new state flower of California?  And if California fails to legalize marijuana in an effort to save their economy, will the State of California end on on eBay for sale?

Stay tuned . . . we are certainly living in interesting times . . . and the remainder of 2009 should be better than any daytime or nighttime soap opera!

My blog experienced a fatal meltdown, so I’ve had to rebuild from scratch.  I may or may not be able to recover old posts, but stay tuned and I will have a new post with an update of Market Stats here in the next few days.

Forrest