http://stephaniebullock.cbvegas.com/blog/archive_201006/sort_entrydatetime-desc/ The extension of the tax credit until September 30 for homes under contract died with the Jobs Bill that failed to pass yesterday, which included other features. So Wednesday of next week is the true deadline to close. These contracts have already been signed so this shouldn't impact sales as long as buyers truly have the cash to close. The continued upside for buyers are continually low interest rates. A record low according to Bankrate.com's 25 year survey. We were generally wrong in thinking interest rates would increase after the Fed finished its MBS program but as with all forecasts, new, randomly acknowledged issues arise and upset the whole dynamic. In this case, it was European debt problems and the stunningly poor quality of prior information on Greece and Hungary's fiscal positions. The flight to quality drove monies to U.S treasuries and this trickles into the mortgage market as lower mortgage interest rates.While a lot of buyers are purchasing with cash in the Las Vegas market, those financing their homes are looking at continued low monthly payments when compared to similar rentals. This makes a home purchase a reasonable alternative to renting as long as it fits into your long term goals of remaining in the City. In many cases, buying is far cheaper on a monthly basis than renting. http://stephaniebullock.cbvegas.com/blog/832/tax-credit-and-interest-rate-update/ Fri, 25 Jun 2010 02:04:22 -0800 A lot of folks went under contract on homes before April 30th hoping to close by June 30 in order to get the tax credit. Many of these homes will not close by June 30 due largely to a backlog by lenders. The senate has extended the closing deadline to September 30. The house has passed their version of the bill in December and the differences in the two bills will have to be fixed before it becomes law.Source: http://www.inman.com/news/2010/06/16/senate-oks-new-tax-credit-closing-deadline http://stephaniebullock.cbvegas.com/blog/802/extended-deadline-for-tax-credit-closing/ Thu, 17 Jun 2010 09:28:00 -0800 Everyone has been curious about the impact of the tax credit on sales. We are seeing a dip but no cliff diving. We have expected that some demand would be pulled forward from the latter months of 2010. Since about half of our market has been investor sales that are not qualified for the credit, the effect may be muted more in Las Vegas than in other areas. The ultimate effect on sales post tax credit may end up being a popular question but with an academic answer. It is going to be hard to disentangle. So far continued low mortage interest rates have kept some in the game. Other macroeconomic factors may trickle down in some form to local housing sales and a lot of this may be mistakenly tagged to the expiration of the tax credit. We know that the expiration will have an effect but by how much is hard to estimate.Here are the contingent and pending numbers up to May. Don't forget, a lot of the contingents are based on a short sale approval, so many of these will not convert to closings anytime soon.                                                           Single Family Home Sales .Source: Mlxchange. http://stephaniebullock.cbvegas.com/blog/783/contingent-and-pending-activity/ Mon, 07 Jun 2010 08:39:24 -0800 It is very common in the United States and elsewhere to use markets to hedge risk. Farmers, who are long whatever they grow, often sell futures on those same products. That way if prices slide by the time they harvest and bring to market, they have already sold at the higher price if a price decline indeed occured. I have been surprised that in the United States that futures products like the S&P/Case-Shiller are still thinly traded on the Chicago Mercantile Exchange. Property derivatives are much more popular in the UK. After all of the misery associated with poor risk management in the past couple of years you would think interest would increase. Nationally, home prices may still have some slack towards the downside, although I think bubble areas like Phoenix and Las Vegas are already trading at discounts because they fell faster (with annual rent/sale price ratios higher than 10). Commercial appears to have even more slack and needs to reset lower. Right now some sellers are trying to price in a recovery, but it will take at least several years to fill the vacant existing space. You really shouldn't see price increases in a widespread condition for some time. Having an efficient method to hedge these risks would be great.REIT magazine recently interviewed Robert Shiller about some of these concepts. Its a quick read and worthwile. Please click to find it. http://stephaniebullock.cbvegas.com/blog/884/housing-derivatives/ Wed, 02 Jun 2010 09:05:33 -0800