Is Las Vegas homes headed for a strong recovery? Possibly.

2,574 Las Vegas homes received notices of default in April 2011, a 48% drop from the same time last year.

Being in ground zero in this foreclosure mess, this data certainly points that there is light at end of tunnel, but we are not out yet.

This week, I had a glimpse as to why we are taking so long in this recovery effort.  I had a chance to speak to a negotiator for a bank on a short sale — he actually called me which is still bewildering but there are some hard working folks that do return calls out there.  Bank negotiator and I  went over what was needed on the file.  During our conversation I asked him how his workload was going, he mentioned  that over 100 open files and counting are on his queue!

I actually feel for some bank negotiators.  How efficient can anyone be with 100+ files of life changing paperwork and not miss something.  He gets calls and faxes all day with people at the edge of their seats waiting for an overwhelmed negotiator to make a decision on one of the most expensive purchases anyone can make in their lifetime.

There is light at the end of the tunnel — absolutely.  When it comes to short sales, the key is not to attack negotiators, but understand their world –slightly.  They are in fact human.  Understanding is key to unlocking the ability to move a file forward.  Being efficient and understanding that it may take multiple tries to reach negotiators.  Being their shining moment in an overly tense day may make the difference between bottom of the pile to getting your file resolved.

Legislation has certainly failed to streamline this process.  Maybe a little bit of humanity will help in some small way to get this plight headed in the direction of recovery.

Break Free From Unaffordable Mortgage Payments!

A recent study in Nevada (a state that holds the nation’s highest foreclosure rate), found that only 5% of distressed homeowners knew they had alternatives to foreclosure, and only 3% took advantage of them. It was also found the 1 in 4 homeowners chose to “strategically default,” or allow their homes to be foreclosed upon on purpose!

Clearly, too few distressed homeowners know their options and the fallout of foreclosure. If they did, they’d soon realize that there’s nothing ‘strategic’ about foreclosure, and that avoiding foreclosure is always the best plan to create financial stability.

Millions of Americans feel alone and trapped by mortgage payments they can no longer afford. In fact, 27% of Americans with mortgages now owe more than what their home is worth. However, more and more of them are finding education on the responsible alternatives to foreclosure is helping them move toward financial stability.

Education is key. The more distressed homeowners know about solutions, the more likely they are to overcome their financial challenges. I’ve seen this firsthand.

 

I can help with the education part—it’s up to you to contact me!

 

 

 

 

Cash is always been king in Las Vegas. Now as of February 2011, cash is ruling the real estate market and investors are bringing the cash in droves to stimulate sales.

Its easy to see why this trend is occurring, and at such an elevated rate.  Investors follow and seek markets that promise solid return on investment (ROI).  With interest rates being at an all time low, return on investment on a simple and safe Money Market account are below 1% (see link for current rates).

Prices in our real estate market are historically low.  With properties being sold at $ 20,000 and up, and rental rates being competitive, it seems like a dream opportunity to make some serious returns.

Lets look at an example of a current real estate transaction. We will calculate return on investment for illustration purposes.

Calculating Return on Investment – Cash

The cash on cash return on investment is the pre-tax cash flow (PTCF) divided by your initial cash investment. The formula looks like this:

Return on Investment  =  PTCF / Initial Cash Investment

For illustration purposes lets look at a cash purchase of $65,000 for a 3bedroom, 2bath home, about 1,100 square feet with attached two car garage.  It has been rehabbed and ready to occupy. Closing costs for home totalled $2,000.  Annual taxes for property is $700 and annual fee for insurance is $400.  Added a $400 a year home warranty plan to protect large cost items like air conditioning, water heater and other minor repairs. Rental Income for this property will be $1,000 per month.

 

Purchase: $ 65,000
Closing Cost: $2,000

Total Initial Investment: $ 67,000

……………………………………………………………………………..
Annual Taxes: $  800
Insurance: $ 400
Home Warranty : $ 400
Maintenance: $  400

Est. Annual Expenses: $2,000

……………………………………………………………………………..

Rents per year: $ 12,000

Annual cash flow (rents per year – Est Annual Expenses) = $ 10,000
Return on Investment  =  PTCF / Initial Cash Investment

= 10,000 / 67,000 = 14.9%

 

It is clear to see why this financial phenomena is happening.  Return on investments are in the double digits and are holding steady.

The concern for this trend is the city would value the trend of home ownership vs.  investor owned properties.  Well see how this trend continues into the recovery of Las Vegas real estate and home market.

 

 

 

Las Vegas real estate market is hot again with investors!  I am inundated with clients ready to purchased low priced properties with cash on hand.  Its easy to see why? Purchasing a property cash for less than $80,000 and renting it for $1,000 or more  bring a great return on investment!  Better than it sitting in the bank!!

As a real estate agent, our main source of properties is the MLS — and so is other real estate agents.  Here is a likely scenario we have encountered with our investors:

We find a suitable house — needs repairs and with a few cosmetic items needing attention with a possible toilet missing.  Listed at $ 50,000.  Call the listing agent and as expected — multiple offer scenario with five cash offers already at the table.  Two weeks later and with no response and multiple offer forms filled out left and right we get the notice.  Seller has accepted another offer.  If we are the lucky person and get the property because we bid above list, we get the email confirming we are the the property it may come with a deed restriction and you cannot sell it at an advanced profit margin for 90 days.  Bank takes forever to finalize the addendum’s and we are at least a month in getting the property in contract.

As experienced agents in this market condition we’ve had the same scenario played out over and over again.

We have a better option.

Horizon Realty Group has opened the Trustee Sales Department to our investor clients who are willing to purchase property at foreclosure auctions — directly from the trustee sale and at the courthouse steps!  Our team has the latest information on properties — lien and superlien information, deed restrictions, title, comparable information, etc — live and immediate during auction.  Runners check properties and make sure the essentials are there — air conditioning, vacancy, vandalism, and general condition.

My first experience with the team has been amazing.  Our team found a great property for one of my clients of which we already have a buyer for and is expecting a five digit profit.  Client already is eager to buy a second property and were looking forward to a lasting relationship with him.

Before I go on,  let me explain the following  — every scenario is different and profits cannot be guaranteed. There are some inherent risks in purchasing properties at auction.  Anyone guaranteeing a profit margin in every scenario is not being truthful. With every risk there is a possible

Our Trustee sale team has extensive knowledge of this section of the market with reportedly over 100 homes purchased for investors and inhouse purchase programs with solid results.  The key is understanding the market is teaming up with experienced individuals that will lay out a gameplan with your investment.

Having a tough time buying your first investment property, whether for flipping or for renting  — give me a call and well set up a comprehensive appointment with you to review your options.

Do note this is a cash only investment opportunity: no financing or hard money loans are considered at auction.  Call me for more details.

 

 

 

Our real estate market got a much needed jolt of positive activity.  According to the Greater Las Vegas Association of REALTORS® March 2011 Statistics, there was 3,384 units sold in March 2011, an 30.6% increase in market activity from February 2011.   (  See Details of this Report )

Median home prices is just below $126,000.  Prices are at 1990 level, which means we are still very much an undervalued market. We’ve seen a large portion of our sales being new home buyers and investors looking to cash in on the high return on investment of our current market.  Most of the inventory coming in is being equaled by inventory going out.   Our Foreclosure Auction team at Horizon Realty has reported seeing more properties being foreclosed on since the robo-signing controversy is close to being resolved. Looks like more inventory will be released soon.

Is the gloom and Doom of this market almost over?  Seems we are headed in a positive direction.  The Great Recovery of 2011 seems well on its way — Lets hope it remains in that direction.