Over the last ten months I’ve been collecting photos of Las Vegas. You won’t see pictures of the Strip only of the Neighborhoods and what really makes this city special. Here is a link that will take you to over 700 photos of the City of Las Vegas and the areas that surround it.
If you’re looking at relocating to Las Vegas or just thinking about a vacation this is a great site for planning that future event.
Is it time to buy a home in Las Vegas?
I’m revisiting this topic since much has changed since August of 2006. Mortgage rates are down and home prices have moved quite a bit lower. Due to excessive speculation by builders and investors we have a lot of supply on the market. This is a buyers market and it may not be that way for long.
One can rarely predict the bottom of any market correction whether it be in home prices or the stock market. People tend to panic and look too much at the present when trying to make decisions.
One thing that I noticed when I came to Las Vegas was how the Las Vegas Valley is filling up. I started to think of Seattle, where I was born and raised. The geography of Seattle is quite different; however, each city displays a unique restriction in the growth of new housing. In Las Vegas, the valley of growth is surrounded on most sides by mountains, and there is a finite amount of land available in the valley for building.
One might suggest that the builders may be able to move outside the valley. Most of that land is owned by the Bureau of Land Management and they would need to make a decision about releasing more land for development. Expanding the boundaries for development is a hotly contested issue with conservationists. You can look to Lake Las Vegas (above) to see what can be done in the middle of a desert.
Why has the demand for real estate been so great over the last five years?
Las Vegas which means “The Meadows” is a lot more than The Strip. Las Vegas is surrounded by beautiful mountain ranges and canyons. You will find that many diverse communities have sprung up from the desert. The Desert Shores, The Lakes and the Lake Las Vegas communities were built around man-made lakes and few people in the country would ever envision seeing such a sight in Las Vegas. There are many master planned communities in Las Vegas and you will find parks, trail systems, community centers, golf courses, and wonderfully landscaped thoroughfares.
Las Vegas was just voted the Number One Adventure Town in America in the September 2007 edition of National Geographic. The reason for this is because of all the opportunities to participate in outdoor activities within a short distance of Vegas: hiking, boating, mountain biking, skiing, rock climbing, to name a few. Vegas is not just for gambling anymore. A secret has been revealed that we locals have known about for a long time.
When one looks at growth in the Las Vegas Valley there are many issues to consider. You have to look at the available water resources, increased energy costs, declines in quality of life as perceived by potential residents, and the physical limitations of Las Vegas Valley. At the present rate of growth, predictions indicate that land currently available for development in Las VegasValley will be built-out in the next 7 years.
What does this all mean?
Okay, we have had over-building and this will continue to depress home prices until the supply is reduced. However, one must keep in mind the limitations that are imposed on this area. There is a real concern about water resources and there are those who will fight development beyond the Valley. If the demand for real estate in the Valley starts to perk up in a year or two, home prices will move higher in the future. You cannot dismiss the law of supply and demand.
Drove to Mt. Charleston on Saturday and yes there is snow. I didn’t go to the ski slopes, instead just drove up to the Mr Charleston Lodge for lunch. Breakfast would have been nice but you need to be there before 11:30 a. m. to be served. After lunch I took a few pictures of the sledding area just above the lodge.
\
Snows piling up!
Kids are so tough.
This is another side of Vegas that many of us forget about. Just as well it would get too crowded.
What does it mean when the Fed cuts rates?
The Federal Reserve Board controls the federal funds rate. The Fed has the power to raise or lower the federal funds target rate and this can influence the market for shorter-term securities. The Fed funds rate is the rate banks charge other banks for overnight loans. This can stimulate the economy. A lower Fed Funds rate means that banks are more willing to borrow money to keep their reserves at the mandated level. Banks lend more, businesses expand, home loans are cheaper (primarily short-term mortgage loans), the housing market improves, and homeowners take out home equity loans (since the prime rate typically goes down).The Fed may raise the rate to keep inflation in check, to slow the economy or it may lower the rate to stimulate the economy. By cutting like they did today they are trying to stimulate the economy.
You should recognize that the Fed doesn’t have much control over long-term interest rates. This can be seen by the fact that the Fed raised the Fed funds rates for a long period of time and mortgage rates and long-term interest rates stayed about the same.
Long-term rates are market driven. The market is driven by inflation expectations, perceived changes in the economy, and the strength of the dollar (which can impact demand for our Treasury securities).
Mortgage rates have been moving lower as the stock market has been declining. This is because there has been a flight to quality. When the market does find a bottom you can expect that mortgage rates will move higher. Investors will move out of bonds and back into the stock market.
If you have any questions or comments please click on comments and let me know what you are thinking.
The stock market seems to be in free fall these days and this is good for mortgage rates. I wrote a post on August 9th (click here) talking about the problems in the sub prime loan market. I mentioned that weakness in the stock market can help mortgage interest rates since investors tend to adopt a flight to quality strategy.
The article mentioned the possibility of the Dow Jones Industrial Average reurning to the 11,000 area. The chart above shows that we are now approaching the 12,000 mark and there is a threat that it may go lower. You’ll note in the next chart (the 10-year Treasury Note yield) that rates have been moving down in simpathy with the stock market.
Remember that the rate on the 30 year fixed mortgage tends to mirror the movement in the 10-year Treasury Note yield. It is my belief that investors have been pricing in a rather large 3/4 point cut in the fed funds rate later this month.
What strategy should you be considering?
The markets may well bounce and hold these levels and if this occurs funds will start to move out of bonds and back into stocks. The market may continue to dive; another 1,000 points can come very quickly. Here again when a bottom is put in, people will move back into stocks. Eventually mortgage rates are going to stop going down.
It is time to prepare yourself in advance of the event. Get yourself pre-approved and start looking for that house now! If you are thinking about a refinance get started now!
I was working at UBS as a financial advisor in 2000. At that time technology stocks were selling at incredible multiples. That is not the case today. I think we may be getting closer to a bottom and this could mean that mortgage rates may go higher in a few months.
Never hurts to get ahead of the game.
Give me a call at 702-351-7912.
TODAY’S THIRTY YEAR FIXED RATE MORTGAGE (Conforming Loan)
5.5% NOTE RATE 5.655% APR (Purchase Loans)
TODAY’S FIFTEEN YEAR FIXED RATE MORTGAGE (Conforming Loan)
4.875% NOTE RATE 5.03% APR (Purchase Loans)
TODAY’S THIRTY YEAR FIXED RATE JUMBO MORTGAGE
(Loans greater than $417,000)
6.5% NOTE RATE 6.655% APR (Purchase Loans)
The rate on the 30 Year Fixed Rate Mortgagee is based on minimum 680 credit score
and a 620 credit score for a 15 Year Fixed Rate Mortgage
20% Down is required for the above rates
Other restrictions may apply.
A conforming loan is when the loan is $417,00 or less. Rates and fees are subject to change without notice.
First United Mortgage is an Equal Housing Lender
Mark V Clawson, Loan Officer
First United Mortgage
702-921-1800
8678 W. Spring Mountain Road, Suite 130
Las Vegas, NV 89117
Ph: 702-351-7912 email markvclawson@gmail.com
Mortgage rates are coming down fast and this is a time to consider purchasing a new home in Las Vegas. Many of you purchased homes 5-10 years ago and still have great equity gains even with the market’s deterioration. This may be a great time to move up to a bigger home.
You can still buy with less than 20% down but the rates will be higher. It just makes sense to get pre approved and find out what you can afford.
Fannie Mae has great zero down programs for first time home buyers. The rates can be very attractive but you need to have the ability to document your income and have some reserve funds. Additionally, you need to know whether the property is Fannie Mae eligible for this type of program. I can help you determine whether this is the case or not.
The 10 Year Treasury Note Yield is the lowest that we have seen in since March of 2004. There is a high correlation between the 10 Year Treasury Note yield and mortgage rates, meaning that this is the time to act.
Not only are prices lower but rates are lower and that works in your favor.
May not be warm enough to swim outside but some of the community centers have great indoor facilities.
There are alternatives to the homes that most builders are putting up in Las Vegas. Most of these homes carry a hefty price tag, however, it is encouraging that someone out there has some imagination. This home is one that I found on a drive through Centennial Hills and you’ll find a few more below.
Adobe and Tuscan stlye homes really do have a place in this desert community of ours. Too bad that the builders can’t seem to get beyond what has worked for them in the past. It would be refreshing to see a builder develop a community that has a more comfortable feel to it.
In Summerlin you will find some homes that have a Tuscan appeal. The picture below is from one of the Summerlin Villages and it is somewhat representative of that type of appeal.
If your looking for a homes like these in Las Vegas give Clayton Fejfar at Century 21 MoneyWorld a call. He is one of the real estate agents that I work with in Las Vegas and you can count on him for excellent service and follow up. His number is (702) 604-6066.
I thought I would share this recipe with you. Remember, I come from Seattle and fresh seafood is alot easier to come by. This is not for calorie counters. It will knock your soxs off, it is that good.
Have a Merry Christmas!
First of all, you have to look at where you are in your life. You may have the means to restructure your assets and avoid the use of a reverse mortgage. There are many things to consider and it is important to take your time before you jump.
That being the case, to qualify for a reverse mortgage you need to be 62 years of age. Your home needs to be your principal residence, and it should be free and clear or have a small mortgage that can be paid off with the proceeds from the reverse mortgage. You have to make sure that your property meets the standards set by HUD and you will need to need to discuss the program with a HUD approved counselor.
I think the counselling program makes a lot of sense, you need to know what you are doing and feel comfortable.
I have been referencing the HUD program because I think it makes more sense than a privately insured reverse mortgage. The HECM Reverse Mortgage loans (HUD program loans) generally provide the largest loan advances of any reverse mortgage. They also give you the most choices in how the loan is paid to you and you can use the money for any purpose. They can be costly, but HECMs are generally less expensive than privately-insured reverse mortgages. Other reverse mortgage may have smaller fees, but they generally have higher interest rates which means less money to you.
Many retirees are cash poor and home rich. The idea behind a reverse mortgage is unlocking the value in your home. Your payments of principal have created an equity pool that you can access.
A reverse mortgage is not an inexpensive loan. That is why it is important to review all of your other options. If those other options are not available then it can make sense. The loan fees are based on the maximum credit limit for the HUD lending area for the government Home Equity Conversion Mortgage (HECM). This means that you may be paying fees on a loan amount that is higher than your actual loan. It is important to have a trusted advisor who you can count on to give you a fair loan fee.
The loan also has an up-front mortgage insurance fee of 2% of the maximum lending limit. This mortgage insurance insures you that you will continue to receive payments even if your mortgage lender were to go out of business. You then have your normal costs of the appraisal, escrow, title fees, etc., and you get the idea.
While the costs seem high, the insurance on these loans are more for borrower protection than any other loan the government insures. This insurance protects the borrowers in two ways. First, if a lender ever goes out of business or fails to pay a borrower in a timely manner for any reason, HUD steps in and makes certain that the borrower receives a steady stream of payments. As you read about lenders going out of business, with a HUD insured loan, you never have to worry about whether or not your payments will be made to you. Also, HUD will insure that the borrower will never owe more than the property is worth regardless of how much money the borrower receives over the years, how much interest accrues, or what property values do in the future. Everyone hopes that values will continue to go up, but if the values should fall, the senior borrower and their heirs will never owe more than the property is worth.
There is an article entitled Top 10 Things You Should Know If Your Interested in a Reverse Mortgage on my menu bar or you can just click here. This should answer most of your questions. Though I do realize that everybody is an individual and their circumstances will be different.
What is mportant to know is that I am willing to work with you in any way that I can. I pride myself in being a trusted advisor and if this program doesn’t make sense for you I will let you know. This is all about helping people and finding some peace in life.
Mark Clawson - 702-351-7912 - markvclawson@gmail.com
