Las Vegas real estate market report

Please wait while I set my soap box down. I am about to give my opinion on this disgusting turn of events by our government.

The Fed lending rate cut, for the most part,  bails out the Banks.

The short term Fed rate is the rate Banks can barrow from the Fed resulting in them making more money.  As a general rule they do not reduce the rate they are charging the consumer resulting in more interest spread or profit.  If their money costs less they make more money.  If the bond market becomes nervous about inflation mortgage interest rates on loans could actually increase as a result of the Fed cutting rates. The cutting of short term Fed rate helps save Banks from their bad investments.  The Fed isn’t really interested in helping ”the average guy on the street.” They are interested in helping the Bankers club and all the upper crust of the investment society.

You will see results on your credit card bills , ARM’s and HELOC’s that are tied to the Fed. bank rate.  This will not help people with teaser rates that can not afford the new rate adjustments.  These home owners and investors will still loose their homes.  This is still a major problem that will not be mitigated by interest rates as poorly written loans cannot be fixed from the borrowers side. These properties will have to be taken back and resold.

If the government wanted to help the average man and the economy. They would give a one time tax credit to go out and buy real estate in 2008.  Maybe offer a one time tax write off of up to 5% of the total purchase price of the property as a direct tax write off.  Example: you buy a house for $200,000 you get a tax credit for $10,000. That means if you are in a 33% federal tax bracket you could earn $30,000 and pay no tax on that money.

This plan would motivate the average guy who is currently sitting on the sidelines to go out and buy a house!

This would help fix the foreclosure rate by stopping this downward spiral of foreclosures with no Buyers.  This would mitigate the losses to the mortgage industry, slow or stop falling real estate prices, stimulate the building industry and the U.S. economy in general.

The Fed and the Government in general is to busy trying to protect the Bankers and Wall Street Investors, they aren’t looking at the larger problem of how to fix the hole housing industry which would change the economic conditions here in the United States and thereby the whole world.

It is the same problem we have had in U.S. for the past 50 years, protect the corporate contributors to elected officials and send the little guy down the river. If we were ever able to eliminate election contributions perhaps our citizens could start looking at the candidates and the issues rather than slanted advertising reducing our elections to a popularity contest.

This has never been more transparent than in the present Executive Branch of our Government with Vice President Halliburton (Cheney).

The Bush plan of sticking $500 in taxpayers pockets is not going to induce people to go out and spend. What will they buy with $500 dollars? More Chinese products at Wal-mart.  How will that help our economy?  We have to benefit those people willing to help our economy not the foreign deficit.

 Reward those that will go spend in industries that will get the basic economy going and fix the problem areas.  The rest of the economy will follow.  By focusing on tax incentives for real estate we will be fixing the problem. 

It’s time for our elected official to turn into leaders, not bickering bureaucrats.  Leadership is something that has been sorely absent in American politics for a long time on both sides of the isle.  Congress and the White House needs to take a look at who they are and gather the courage to help OUR Country, not our Corporations, not our Foreign Investors, not their own interest or campaign contributors.  

Our political leaders VERY QUICKLY need to gather the patriotic courage of our forefathers and do what is right for the people and our Country. If we do not put our own house in order how can we help anyone else.

 If they fail in this task, we may very well see ourselves in  the worst situation since the Great Depression.

For the Latest in Las Vegas real estate call Max at 702-334-2200. Or email me at:Max@MaxSellsVegas. com. Your comments and questions are welcome.

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It appears that the foreclosure rates on sub-prime mortgages have continued to restrain the ability of qualified Buyers to obtain financing when purchasing a home.

   This has resulted in many fewer home purchases nationally.  As lenders try to determine how to estimate their portfolio losses and project further losses in the financial markets.

The Fed has reacted with short term interest rate cuts but this has not curbed volatility in the mortgage markets.

The losses in the mortgage sector could reach an estimated $2 Trillion dollars.  But in relation the dot com stock market bubble resulted in a $7 Trillion dollar loss.

The National real estate markets report some areas are still falling in pricing and volume while some areas of the country are actually appreciating.

See more by clicking on the picture above or this link to see this U.S. Real Estate Report video.

For the Latest in Las Vegas real estate call Max at 702-334-2200. Or email me at:Max@MaxSellsVegas. com. Your comments and questions are welcome.

Technorati Tags: U.S., real, estate, report, market, news, reposessions, sales

The Fed decision arrived with a Big Change! The Fed surprised most economists and traders with a one half percent cut in both the Fed Funds and Discount Rates. Stocks soared higher and enjoyed their largest gain since 2003.

What does the Fed interest cut mean? Rates on consumer car loans, consumer loans, and Home Equity lines will all benefit. But because Las Vegas Home Loan rates are tied more closely to inflation, it is not uncommon to see less of a reaction…or even an opposite reaction in mortgage rates.

This cut also hurts rates of return on investments.  This gives foreign investors less incentive to invest in US securities. This action by the Feds has resulted in sending the Dollar much lower against the currency of most major foreign countries. This makes foreign goods more expensive for us to buy, which adds to inflation pressures.

This Fed interest cut is good news for the U.S. economy, but may nudge inflation a bit higher.

For the Latest in Las Vegas real estate call Max at 702-334-2200. Or email me at:Max@MaxSellsVegas. com. Your comments and questions are welcome.

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I have just completed the latest video report on the U.S. real estate market. You can view the report about the United States Real Estate markets by clicking on the picture to the left.  It appears the real estate market in general is beginning to turn for the better.  Find out why the markets are looking up in this special “U.S. Real Estate Report.”

For the Latest in Las Vegas real estate call Max at 702-334-2200. Or email me at:Max@MaxSellsVegas. com. Your comments and questions are welcome.

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I  just completed the May 2007 video report on the U.S. real estate market conditions. You can watch the video by clicking on the picture to the left. If you prefer to read you can find the script below.
RealtyTrac  a foreclosure service reported that 430,000 foreclosure filings, default notices, auction sale notices and bank repossessions were reported nation wide during the first quarter of 2007. That is one in every 264 homes. According to Moody’s analyst Mark Zandi 2.87 % of the total U.S. housing market is in some sort of foreclosure. Mr. Zandi feels the problem will continue through 2007 as subprime loans rest to new higher interest rates through the rest of this year.
 This figure represents a dramatic increase in for closures up 35% from the same quarter in 2006 according to RealtyTrac. Viewers should keep in mind that the greatest part of the 430,000 foreclosure filings include the initial “default notices” which is a letter sent out to owners that are more than 30 days late on their payment.  Please note, that a property may have up to 3 foreclosures taking place at the same time if the owner has a first mortgage, second mortgage and home equity loan on the property.  Less than 5% of these “default notices” become actual foreclosures as most home owners will then makeup their payment and late fees.
 
 More Than 430,000 Foreclosure Filings Reported in Q1 According to RealtyTrac(TM) U.S. Foreclosure Market Report 

Mortgage Delinquencies Reach All-Time High

On April 24th, Countrywide Financial Corp. Chief Executive Angelo Mozilo speaking at a Milken Institute Conference said he expects the mortgage market to improve in 2008 and be “Very healthy” in 2009. He said that 5 to 6% of the nations riskiest subprime loans may face foreclosure. He went on to say that 94% of these loans will not go into foreclosure.

Currently more people own a home than in any time in the history of the United States.  Much of this is due to the subprime or exotic loan market. Although foreclosures are at an all time high so is home ownership.  For someone to rent in today’s real estate market and save tens-of-thousands of dollars for a down payment and closing costs is unrealistic for most people seeking the American dream.  Many home owners today got their opportunity through these exotic and subprime loan programs and 94% will make good on their dream of long term home ownership.
Concerning the subprime mortgage companies that have gone bankrupt or are severely damaged by the market change.  We need to keep in mind that we live in a free market society and these companies chose to loan money at higher rates to these people.  Investors bought stocks in these companies and purchased bonds that promised higher yields than other more conventional investment. The investors in these assets choose to take the risk to receive the higher return, it just didn’t work out for them.
So in the end we have 94 families that now own a peace of the American Dream and 6 families who didn’t make it happen, for what ever reason.  Maybe some of these 6 were investors risking their credit on the appreciating real estate market.
Are we to feel sorry for the short term real estate investor taking their risks?
Are we to feel sorry for the Exotic mortgage company taking their risks?
Are we to feel sorry for the stock and bond investor taking their risks?
Should we really be upset with the 100 people that took out subprime and exotic mortgages because they didn’t have a down payment?
Right now there is a movement in congress to change the laws on loans.  If successful this might block future 94 people from obtaining their American dream of home ownership.  Mortgage Companies have already tightened their restrictions on exotic or subprime loans we don’t need any new laws.

If no down payment exotic mortgage loans are such a bad thing, then why have we Americans allowed our Veterans to have them ever since World War II.  No Down loan programs are not a bad thing as long as it is reasonably balanced with risk.  Should investors have no down loan programs? Probably not. This alone may make a large dent in that 2.87% repossession rate that the mortgage companies are now crying about.

We need to preserve every opportunity for our youth to obtain home ownership weather the real estate markets take a small re-adjustment or not.
On April 24th the NAR reported that the number of homes sold in the U.S. decreased by 8.4% from the 2006 figures.  A part of this lower sold rate could be attributed to the severe weather that occurred in February when homes that closed in March would have been placed under contract.
A positive sign showed the National inventory of homes for sale fell to 3.75 million units which is a 1.6% decrease in inventory representing a 7.3 months supply in the market place.
The median sales price of a single family home is down 0.9% from 2006.  If this were stocks it would be considered a minor adjustment but to hear the national press trying to sell papers and air time it seems a crisis.
David Lereah, chief economist for the NAR “We’re still looking for existing home sales to gradually improve during the last half of 2007.”
Weather Hits March Existing-Home Sales After Three Monthly Gains

Finally, I want to tell you about a report that came out of Las Vegas about one of Carl Icahn’s companies.  Mr. Ican is a well know corporate investor that buys when the market is soft and sells when it is strong  producing billions of dollars in profits. This last week a deal was struck between his company, owner of the Las Vegas Stratospher and 3 other minor casinos, and a real estate holding company owned by Goldman, Sachs & Company.  The Stratosphere was purchased by Mr. Icahn’s company out of bankruptcy when the market was soft, a Buyers Market.  Mr. Icahn’s company is now under contract to sell the properties for $1.3 billion dollars.  They announced this would lead to a net gain of $1 billion dollars.
The moral to this story is buy when others aren’t and sell when everyone else is buying.
It’s a Buyers market in most of the United States and excellent investments with excellent terms abound.  Interest is low and selection is plentiful. Weather this is your first home, vacation home or retirement home, now is the time to make a great deal on a home.  Don’t wait until everyone else is buying or you may be paying a lot more.

American Real Estate Partners, L.P. Agrees To Sell Its Nevada Gaming Operations to Whitehall Street Real Estate Funds for $1.3 Billion

For the Latest in Las Vegas real estate call Max at 702-334-2200. Or email me at:Max@MaxSellsVegas. com. Your comments and questions are welcome.

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