For the second month in a row we are seeing falling inventories.  If you are out looking for a house right now, you know how competitive the market has become.  In May there were 15,046 houses and condominiums/townhouses listed in the MLS for sale.  This month there are currently 13,086 listed for sale.  Bank owned inventories on the market have fallen to 2,969.  Short sales remain fairly stable at 5,492.  Numbers of properties under contract remain high at 11,620.  Of these 5,696 are bank owned and 4,660 are short sales.  A closer look at the short sale numbers supports the weakness of successful closings in this category.  When a short sale has an accepted offer on it, it goes into contingent status, meaning the contract is awaiting approval by the lender.  4,312 of the 4,660 short sales under contract are in this contingent status.  When the lender approves the short sale and the buyer has removed any additional contingencies, the status changes to pending.  There are only 348 short sales in pending status.

Closed sales remain high - 3.918 in the month of May.  2.928 were bank owned, 282 were short sales and 708 were regular resales.

At current absorbtion rates, there is a 6.9 month inventory of homes on the market.  A comment made on last month’s market update has a great deal of validity.  The foreclosure moratorium is over and lenders have begun sending notices of default again.  From the date of filing of the notice of default to the date when the property may be sold is 120 days.  We may be looking at increasing inventories in the fall.

These numbers are not to be believed.  I didn’t when I first ran them.  Right now there are 12,095 residential properties with offers on them.  Yes, 12,095.  I just had to look again.  Of these, 6,399 are bank owned and 4,427 are short sales.  There are 15,046 properties currently for sale.  This market is hot!!!

Sales in April numbered 3,885, the most for this time of year since 2005.  Of these sales, 3,065 were bank owned and 318 were short sales.

Sales $100,000 and under  1415

Sales $101,000 to $200,000 1658

Sales $201,000 to $300,000 523

Sales over $301,000 285

The most important information though, is this.  There is currently a 6.62 month inventory  of homes in the MLS.  The buyer’s market is over.   8 or more months of inventory is considered a buyers market.  5 to 7 months of inventory is a a normal market, favoring neither buyers or sellers.  Under 5 months of inventory is a sellers market.

Did you say it's time to go to the dog park?

Acacia Park Dog Park - S. Gibson Rd. & Las Palmas Entrads, Henderson.  This fenced dog park is open daily from 6am to midnight.

All American Dog Park - S. Buffalo.  This park has one large dog enclosure.

Barkin’ Basin Dog Park (at Wayne Bunker Park) - Alexander Rd. and Tenaya Wy.  This dog park has 3 areas: for small dogs, for big dogs and one that is resting.

Cactus Wren Dog Park - 2900 Ivanpah Dr., Henderson

Centennial Hills Dog Park - Elkhorn and N. Buffalo Dr.  This dog park has two areas.

Children’s Memorial Dog Park - W. Gowan Rd.  There are two separate enclosures at this park.

Desert Breeze Dog Park  - 8425 W. Spring Mtn. Rd.  There are three dog runs available; one for small dogs, one for middle sized dogs and one for larger dogs over 30 pounds.

Desert Inn Dog Park - 3570 Vista del Monte

Dog Fancier’s Park - 5800 E. Flamingo Rd.  This is a 12 acre park that allows canine enthusiasts to train their dogs off leash.

Dos Escuelas Park Dog Park - 1 Golden View St. Henderson.

Hayley Hendricks Dog Park - 811 Ithaca Ave., Henderson.

Jaycee Dog Park - E. St. Louis Ave. and S. Atlantic St.  This park has two separate enclosures.

Kellogg-Zaher Sports Complex Dog Park -  W. Washington and N. Buffalo Dr.  This is one of the best dog parks in Las Vegas, which three separate dog areas.

Lorenzi Dog Park - 3494 W. Washington.  This is a small dog park, but you can play tennis at the new facility or watch some great tennis being played.

Molasky Park Dog Run - 1065 E. Twain Ave.

Police Memorial Dog Park - Metro Academy at W. Cheyenne.  This dog park has separate enclosures, one for large dogs and one for small dogs.

Shadow Rock Dog Run - 2650 Los Feliz on Sunrise Mountain.

Silverado Ranch Park Dog Park, 9855 S. Gillespie.

Sunset Park Dog Run - 2601 E. Sunset Rd.  This dog park offers 1.5 acres of land for your pooch to play.

Winding Trails Dog Park, Elkhorn Rd.

Woofter Dog Park - Woofter Family Park, Rock Springs Dr.  This park has two separate areas for dogs.

The American Recovery and Reinvestment Act of 2009, passed in February allows up to an $8,000 tax credit for first time home buyers who purchase a home between January 1, 2009 and December 1, 2009.  If you are a first time home buyer who purchased a home on or after April 9, 2008 and  by December 31, 2008, you are entitled to a $7500 tax credit.  This is a modification of the Homeowners Relief Act of 2008, which allowed for a $7500 tax credit, but required it to be repaid.  This no longer needs to be repaid.

The IRS defines a first time home buyer as someone who has not owned a principal residence during the three year period prior to the purchase.  The tax credit is equal to 10 percent of the home’s purchase price up to a maximium of $8,000.  You must complete the purchase before December 1, 2009.  This means the last day to close on the home is November 30, 2009.

There is an income limitation.  Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit.

How is the Las Vegas real estate market effecting renters?  We’ve all heard the sad stories of renters being evicted from their homes because the lender foreclosed on the house without the tenants’ knowledge.  Some people found themselves being evicted despite the fact they’d been paying their rent.  Security deposits were lost.  Gradually, some safeguards were identified.  In a previous post I’d provided information on how to find out if a house had entered the foreclosure process.  Rereading this post also shows how much a market can change in a year.  At that time, there was a shortage of rental properties as investors lost their properties to lenders.  Now, those same properties have been bought again by investors, at great discounts, and put back into the rental market.

The sweet spot for lease rates appears to be anything up to $1200.  So, for $1200, you can rent a house with three bedrooms, at least a one car garage and a place for a bbq.  This means apartment house owners are feeling the competition.  Apartment renters are abandoning their apartments for single family residence living.  In 2006, the apartment vacancy rate was 4%.  Now, it’s 11%.

An investor with cash or a 30% down payment, may purchase a property, rent it for around $950 if it’s a condo and $1200 for a 2 to 3 bedroom house and expect a positive cash flow.  Of course, with so many rentals available, the pressure to be competitive is strong.

In an interesting twist, banks foreclosing on rental properties are beginning to allow tenants to stay in place as long as they continue to pay their rent.  This allows the bank defer some of its expenses until it is ready to put the property market.  Do you think a year from now we may find lenders in the landlord business?

What’s the big news this month?  There were twice as many sales in March 2009 (3,534) as there were in March 2008 (1,780).  Buyers are taking advantage of low prices and low interest rates or taking their cash and investing it in real estate for future equity or current income.

With current listings at 18,624 (Single family 14,129/CondosTownhouses 4,343)and 9,643 properties under contract,  the sales numbers for March 2009 are

Total Sales                             3,534

Single Family                         2,924

Bank Owned                         2,305

Short Sales   202

Regular Resales  391

Condos/Townhomes            601

Bank Owned     503

Short Sales           31

Regular Resales 64

Broken down by sales price, the numbers are

$100,000 and under                                     1,103

$101,000 to $200,000                               1,562

$201,000 to $300,000                                 567

$301,000 and up                                              298

This morning I was on the phone with Countrywide’s short sale department.  I was so angry when I got off  the phone, that I sent the following email to Senators Reid and Ensign and Representative Titus.

“I am a real estate agent, licensed in Nevada for the past five years. I just got off the phone with the short sale department of Countrywide with whom I have been negotiating a short sale since November 25, 2008. The buyer’s agent and I have worked diligently, he to keep his client loyal to the property, and me in working with Countrywide to work towards a successful close of this transaction. The property has appraised for the sales price and the buyer is ready, willing and able to purchase. Nevertheless, after over three months of negotiation, the negotiator closed the file, ostensibly for lack of documentation, although Countrywide’s own records indicate they have received them. I am advised by Countrywide that the file must now be reopened with a new negotiator. Based upon past experience, it will take another four months to get a final answer, if the file is not arbitrarily closed again.

Only 10 percent of short sales are successfully closed precisely because of examples such as this one. Over three months of work has been lost by myself, the buyer’s agent, the buyer and the seller. The disrespect and disregard which are displayed by Countrywide in particular and other lenders in general is truly appalling. It also has the effect of slowing down any recovery. If short sales could actually be negotiated, you would see a distinct difference in the state of our real estate market.

As I know you are aware, the Making Housing Affordable plan passed this week really does not provide much assistance to homeowners in our area. Making short sale negotiations easier would. It would stop the downward pressure on housing prices, move inventory and slow foreclosures.”

Here we are in March with 19,775 listings in our Multiple Listing Service, of which 15,176 are single family residences and 4,463 are condominiums or townhouses.  5,237 of the single family are bank owned and 5,414 are listed as short sales.  There are 1,514 bank owned condominiums listed and 1,381 listed as short sales.

We have 6,589 contingent or pending contracts on single family houses, of which 3,808 are bank owned and 2,058 are short sales.  There are 1,238 condominiums and townhouses under contract, 713 bank owned and 401 short sales.

There were a total of 2,223 sales of single family homes in February.  1,765 were bank owned and 188 were successful short sales.  435 condominiums and townhouses sold - 370 bank owned and 21 short sales.

In a previous post, we discussed falling home prices and what they really mean.  The numbers of sales by price listed below demonstrate the effect numbers of sales in particular price categories have on the average or median price of houses.

Single Family Sales                                                                                  Condominium/Townhouse Sales

455                                                          less than $100,000             300

1,116                                                       less than $200,000             110

419                                                          less than $300,000             13

301                                                          more than $301,000         11

Another interesting consistency I’ve been noticing is that approximately one-third of properties which go into contract actually result in a closed sale.  This may be directly attributable to the failure of short sales to result in a successful closing.

On February 18, 2009, President Obama announced his housing plan designed to help 7 to 9 million families avoid foreclosure by refinancing or modifying their mortgages.  The plan also strengthens the federal commitment to Fannie Mae and Freddie Mac (the government sponsored enterprises, or GSEs).

On March 4, 2009, the administration released detailed guidance on the Making Home Affordable Program.

Here are the key elements of the Obama plan:

1. The Home Affordable Refinance Program. Under this program, eligible borrowers may refinance loans that Fannie Mae or Freddie Mac (the government sponsored enterprises, or GSEs) own or guarantee.  The program can help homeowner-occupants who are current in making loan payments and have loan-to-value ratios (LTVs) above 80 percent but not more than 105 percent.  Cash out refinancings are not permitted.  The program ends in June 2010.

2.  The Home Affordable Modification Program. This is a $75 billion program with lender, servicer, investor, and borrower incentives to make it work.  The program is limited to homeowner-occupants who are at risk of default or already in default and who have loans at or below the maximum GSE conforming loan limit of $729,750 (or higher for 2-, 3-, and 4-unit properties).  Loan modifications under the program may be made until December 31, 2012.

3.  More Support for the GSEs. President Obama also announced more support for the GSEs, including doubling of potential Treasury investment from $100 billion to $200 billion for each GSE, to maintain their positive net worth.  The plan also raises the cap on mortgages that the GSEs may hold in their portfolios by $50 billion to $900 billion.

For more detailed information, contact LasVegasHomeSpecialist.com and request a detailed summary of the Housing Affordability and Stability Plan.

By now you probably have heard that prices dropped another 3 percent in January, while the number of sales continues to be strong.  Does this mean that the price of each house dropped by 3 percent?  How are these numbers determined?  As we’ve followed the market, it has become clear that the vast majority of sales are below $300,000.  Sales over that amount number in the hundreds, while total sales are over 3000 a month.  Of the sales below $300,000, the vast majority are below $200,000.  So, as buyers gobble up the good deals, the median and average sales prices go down.  Houses valued over $300,000 are simply not selling.  If they do, we’ll see the median and average sales price go up.  That wouldn’t mean that prices were really going up; higher priced houses would simply be selling.

If you’d like to check out listings on the MLS yourself, go to our website and click on Home Search.