LV Home Buyer, Home Buyer in Las Vegas, NV

Are builders in Las Vegas willing to take paper in order to make a sale at this time?

Asked by LV Home Buyer, Las Vegas, NV Sun Mar 30, 2008

I see that the bulders in LV have overbuilt, and some have many deals which have fallen through due to financing problems in the current market.

My question is: Do any of the local / regional builders take back paper (2nd's) in order to make sales?

Has anyone done this sort of thing with a local builder?

You may contact/email me privately, if preferred.

Thanks very much.

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Answers

3
Hi LV Home Buyer,

The media often likes to portray the Vegas, or any market, as overbuilt by home builders. That's a bit of a misconception. They had been reacting to demand, and at one point couldn't keep up. Not that long ago there were some developments around Las Vegas holding lotteries for building lots, and a backlog of pulling permits.

The builders also reacted when the market slowed and by late 2006 already began reducing inventory here in the valley. Since then they they've whittled down their home counts, passed on land options, and what had been previous market based months of supply is now usually measured in weeks based on today's levels. While there is still standing inventory to chose from, the industry has primarily gone with price reductions, keeping pace with the general lowering of market prices caused by foreclosures. Those foreclosed properties are where you find the oversupply.

Combine healthy price cuts with tighter credit standards, and like the others have mentioned, I doubt you'll find any builders offering a second. The piggybacks have had a much higher default risk and a big part of the suicide loans that triggered nationwide housing declines in the first place.

In general, what I've been seeing more of for Las Vegas real estate sales is FHA / VA loans with their allowing seller incentives toward closing costs and down payments. The recent influx of $200 billion into the mortgage market through Fannie Mae & Freddie Mac has not only added liquidity to the lenders, but has 30 year fixed rates sliding under 6% in the last 2 weeks. These items with the lower pricing across the board is what I believe is causing the increased activity here in Las Vegas.

Sveral analysts are saying that if Las Vegas housing hasn't reached bottom, it's close. This article mentions that, and the typical local builder incentives being offered.

http://www.kvbc.com/Global/story.asp?S=8075298
2 votes Thank Flag Link Sun Mar 30, 2008
I have not seen any builder's doing this. Most builder's here in Las Vegas have very little standing inventory left. Good luck on this one
2 votes Thank Flag Link Sun Mar 30, 2008
Thanks for the answers. I have noticed that builders have recently lowered prices on their standing inventory and are also accepting lower offers. One builder I called had recently lowered his prices about 30k and then a week later another 10k when I called. With the 3% toward closing costs plus other incentives, it is a good time to haggle and buy with these builders. I suspect many of these deals will be gone by summer when their remaining inventory is reduced.
1 vote Thank Flag Link Thu Apr 3, 2008
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