Las Vegas real estate market....thoughts?

Below are a few of my thoughts on the market right now:

-Inventory has decreased month after month for several months now pushing us more toward a seller's market. With that being said the market is fairly balanced right now. Buyer's do not have to over pay for properties any longer and sellers are expecting to get close to appraisal value for their properties.

-Many listings are listed way above value as some sellers and listing agents still believe it is 2012-2013. The listings priced correctly are still moving quickly.

-Some neighborhoods where the values skyrocketed we are seeing some correction as other surrounding neighborhoods catch up in value.

-We are stilling seeing around 6% CAP rates give or take. You can find some good deals from time to time and still get 9% etc but it takes a little more work to find those. If inventory continues to decrease I would think the higher CAP rates would become that much harder to find.

-Rates are still very low and there is a lot of talk about increasing rates in June as well as more talk about it increasing a quarter point in Q4 for 2015. We will see how it all plays out.

-New Builders are still building and asking too much. Many times the appraisals won't come in and builders either reduce the price or the buyer will come in with cash or a mix of both. New builds are still not a good deal in my opinion and haven't been for years.

-NOD's are up slightly the past few months but are still way below the 2009-2011 days. I don't see this being a major contributing factor to inventory in the very near future. If legislation changes then maybe this will come into play again but again I don't see anything changing this right now.

Are you talking about 6-9% CAP rates on rental houses, apartments, commercial property or what?

I was referring to residential rentals single family homes, townhomes, and condos. Multifamily tends to be a little higher cash flow but then the maintenance costs are higher due to mutliple AC units, appliances, roofing, plumbing, electrical etc.

I still think of much of Las Vegas as the land of cookie cutter townhouses where there are whole housing tracts where every single place looks the same. When I look at some of the interiors of those places, the builders seemed to use the cheapest materials for counter tops, cabinetry, lighting fixtures, flooring, etc. Are those places starting to sell again?

You are correct there are a lot of homes and townhomes in Las Vegas that looks very cookie cutter. A lot of the builders over the last 15 years have used very cheap materials. This is one of the reasons you see so many flip properties. Investors will buy these basic properties, put in upgraded materials that cost slightly more than average but give a higher end look. This makes the property stand out from the cookie cutter homes so they sell for a premium.

To answer your question all types of residential properties that are priced correctly are still selling and have been since 2012 regardless of whether they are cookie cutter or not.

Hope this answers your question.

Here is an example of an entryway remodel I am doing right now. It is completed now but this is a picture when it was almost completed. This remodel I went with higher end materials than most flips.


Since this picture we also added this chandelier in the entryway.

Which is the remodel?

Seriously. I know that sounds bad but I don't mean it that way. I'm sure the pictures don't do it justice.
The stair treads on the right look better but the floor on the left look better.

The original black marble flooring was 12x12 tiles frome the early 90s. The new flooring is half inch by half inch marble mosaic tiles. You can't tell in the picture. Now that there is a chandelier above it the marble is much brighter also.

The entryway remodel includes:

New wrought iron stair rails
New real bamboo wood flooring on stairs.
Refinish banister to match bamboo
New chandelier with added dimmer switches and LED lights
New 3 tone paint
Marble mosaic tile floor
6" crown moldings
5 1/4" base boards replacing 3"
New bigger and more decorative door casings
New hinges, handles, and door hardware
New camera and alarm system
WiFi Nest CO2 and smoke detectors
WiFi Nest Thermostat

I could tell the difference. The wood railing on the left looks like the normal railings you see in tract homes. You did a nice job.