LAS VEGAS HOMEOWNERS HAVE THE OPTION LOAN OR LINE OF CREDIT
There’s a reason the English language’s greatest playwright was called “The Bard of Avon” and not “The Bard of Las Vegas.” In Hamlet, for instance, despite the fact that Shakespeare’s Polonius character is supposed to be a wise counselor, he gets at least one piece of advice wrong when he tells his son, “Neither a borrower nor a lender be.” This is flat-out terrible advice—at least for many Las Vegas homeowners. The thing about borrowing is that if done prudently, borrowing can free some of the value a given Las Vegasresidence represents. There are two different ways that happens: First off, there is the property’s stored value (the equity). As each monthly mortgage payment whittles down the amount owed to the lender, that equity builds—more so if the value of Las Vegas real estate happens to be growing in general, which has been true lately. Unlike the other daily living expenses a family incurs, the dollars paid for your Las Vegas shelter aren’t entirely “spent”—that is, lost. Like a savings account, the portion of the money that isn’t apportioned to interest will be recapturable when the home is sold. Better yet, you don’t have to sell the place in order to free some of the value of that equity. After all, if you had to move out of your house to make use of it, it would be highly inconvenient. But you can make use of the property’s value in the meantime by naming it as collateral for a loan—either a line of credit (HELOC) or a home loan (a second mortgage). Because both types are smiled upon by lenders since they are secured, the interest rate will be less than for other kinds of personal loans. The second way that Polonius’ advice would have been wiser in Hamlet’s Denmark or Shakespeare’s England than it is here today involves a more contemporary character: Uncle Sam. Some or all of the interest paid on either a HELOC or a second mortgage may be taken as a personal income tax deduction, depending upon various factors. Polonius might foolishly offer some blanket advice about that—but wiser counsel would be to consult your tax advisor. When it comes to deciding which makes more sense for tapping into your home’s equity— opening a line of credit or second mortgage—the choice depends on the uses planned for the cash. If you know exactly how much you need (as when a major home repair is needed), the key advantage of an equity loan is that the interest rate and repayment schedule are fixed. With a HELOC, you have more flexibility: it works like a credit card. You can repay a borrowed amount and later tap into the line of credit again without reapplying. On the other hand, the interest rate and repayment requirements can change over time. And like a credit card, there is a built-in temptation to overuse it. Polonius wouldn’t approve… The financial wisdom of owning your home was around long before Shakespeare’s time— it’s one thing that doesn’t change. Whenever you have a question about your own plans and Las Vegas real estate, I hope you’ll give me a call. As usual, the Bard had something wise to say about that, too: “Better three hours too soon than a minute too late!”
LAS VEGAS REAL ESTATE OUTLOOK STEADY AS SHE GOES
It wasn’t exactly huge news, but last week, the revised economic numbers showed improvement! When does thatever happen—when the final revisions come in, don’t they always seem to be in a downward direction? Yet Friday’s release from the Associated Press told a different story. Earlier reports of a slowing U.S. economy had been revised to show a year whose beginning “wasn’t quite as bad as first thought.” The reason was housing—which “got a bigger boost” than first reported. This is all to suggest that the wider economic climate for Las Vegas real estate—that is, for sellers and buyers midway through this year’s spring/summer selling season—is one that shows improvement (“slight improvement,” according to many—but we’ll take it). Fears of an economic stall seem to have vanished for the moment. Lacking was anything in the economic tidings that would suggest the Las Vegas’s real estate picture includes any storm clouds on (or even over) the horizon. ITEM: Per the ABCNEWS site, economists are forecasting a rebound in the current quarter—to a growth of around 2%. That was expected to improve as well: “In the second half of the year, economists are forecasting that growth will strengthen further to around 2.5%.” ITEM: In what is now the seventh anniversary of economic expansion, Reuters reported that U.S. new homes sales had notched an 8-year high. “New U.S. single-family home sales recorded their biggest gain in 24 years in April…as purchases increased broadly.” ITEM: Last Thursday, Mortgage News Daily reported mortgage rates the lowest in “more than a week.” For sharp-eyed Las Vegas real estate watchers, this might have been puzzling, given that Freddie Mac had just announced that rate “rose rather sharply.” MND clarified the contradiction by explaining, “that’s to be expected given [Freddie Mac’s] report’s methodology…” ITEM: U.S. News & World Report disagreed, siding with Freddie. But in a sunny sort of way: Mortgage rates “rose this week but remained at low levels that could entice purchasers amid the current home buying season.” ITEM: Even if Freddie and U.S. News had been right, and home loan rates were on the rise, another respected real estate voice spoke up to suggest that even that could become good news for real estate. How so was elaborated in Yahoo! Finance’s interview with Toll Brothers Chairman Robert Toll, who turned most commonly held assumptions on their head: “If the Fed goes up and the mortgage rates go up…it probably means price increases are coming soon, which spurs demand and spurs action.” Summing up, it was, on balance, a quietly upbeat picture—one pointing to a future for Las Vegas real estate clear of any rough patches in the immediate future. Given that there continue to be exceptional offerings in our market—and with home loan rates still being locked at terrific levels, for sure it’s an opportune time to give me a call!
LAS VEGAS MOVING DAY WITH SMALL KIDS MAKE IT FUN
Moving Day: for Las Vegas residents who relish order in their lives, this is one day when no amount of preparation is likely to totally quell the feeling that the world is on the verge of chaos. The day (or days, if the move is one that begins or ends outside Las Vegas) will predictably end with all worldly goods beginning to rearrange themselves in their new settings—but although the outcome is assured, as moving day approaches, rattled nerves require taking a deep breath. Several deep breaths… When you add small children to the mix, strategic preparation is even clearer as the order of the day. Some of the tried-and-true ideas are ones that all parents naturally figure out—such as having kids help put things away at the new house so they feel part of the process (as well as seeing where familiar things are now located). Other strategies may be obvious, but in the throes of unpacking, can require discipline to carry out—like sticking to the kids’ familiar morning and evening rituals. One idea is especially useful because it can be completed before the movers arrive. Create a special box or duffel bag with all the child’s “gotta-haves”—toys, blankies, pj’s, toothbrushes, a favorite book or two, and the like. Then add some Ziploc bags with the very best special favorite treats (ones that don’t need to be refrigerated)—these will definitely come in handy. Be sure to keep an eye on the special bag throughout the day, and let the child know where it is. Especially as long as there are untapped treats in there, its safety and well-being will be a healthy diversionary focus. See if you can arrange for the children’s room to be the last the movers pack into the truck. That way, they’ll be first out—which will allow you to set up the children’s room ahead of everything else. It may be necessary to fight powerful contrary urges—like getting the kitchen into some semblance of order—but it will be worth it. See if some of the child’s own ideas about where to arrange their things are doable. If so, all the better: the feeling of ownership will help make their new room no longer such a strange place (and possibly exactly the perfect place to dig one last treat out of the duffel bag). Making moving fun for kids is a noble goal. It’s doable for some, but since all kids are different, perhaps creating a moving day where the kids feel they’ve been valued contributors to a family adventure is a significant enough outcome. Moving day is, after all, the culmination of the team effort that stretches all the way back to when you made that first call to the one who turned out to be your Las Vegas REALTOR®. If you’re just at the starting point, I hope that call is to me! 0
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