TOP 6 FAQS FOR LAS VEGAS HOME BUYERS
Like careful consumers who are investigating any major purchase, Las Vegas home buyers need to address some of the same basic queries. Among home buyers, those who already own Las Vegas homes may think they have different questions than do first-timers, but even for those who have successfully navigated the process before, if it’s been a while since then, some basics may need refreshing: 1. Should I buy or rent? This is quite rightly the lead question any Las Vegas home buyer needs to answer. It’s not one that many Las Vegas residents who are already homeowners spend a lot of time on since the answer for their own family has already been a “yes.” For them, unless some major changes have come to pass, they can safely assume that homeownership is still a no-brainer. 2. How do I get started? There are two good answers here: Get a mortgage pre-approval, and/or tap the services of a great Las VegasRealtor®. Although a lender’s pre-approval isn’t a requirement, getting a green light in advance can’t help but create a positive atmosphere with sellers and their representatives. It demonstrates serious intent—and in a competitive situation could even wind up winning the day. 3. What’s the right credit score to buy a house? 620-650. Okay, okay—I know there’s actually no number that’s truly the “right” credit score for all circumstances. It depends on so many possible outside factors that the exceptions are too numerous to list. That 620 number (and higher) does seem to be one that lenders like to see; with 580 the common minimum low down payment FHA qualifier…but that can even be less in order to qualify for the FHA 10% down payment program. The only bullet-proof answer for the “right” credit score is—the best one you can build! 4. How much will the down payment be? This one depends on the Las Vegas property you choose, the home loan you select—and also, to a degree, on how much you want to pay. It used to be common sense that you should pay as much as you can afford in order to minimize the amount of interest you wind up paying over the life of the home loan. But with interest rates as low as they are today, some financial gurus are less confident about that advice: there may be more lucrative ways cash can be put to work. 5. How much do I have to pay my agent? Nothing. The buyer’s agent fee is paid by the seller. 6. Should I use a real estate broker? This answer comes from the HUD.gov website: “Using a real estate broker is a very good idea.” As HUD says, “the details involved in home buying, particularly the financial ones, can be mind-boggling.” Needless to say, that last Top Home Buyer FAQ is a personal favorite. It’s really just another way of saying, “call me!”
LAS VEGAS MORTGAGE RATES WANDER BUT NOT VERY FAR
The legendary figure of The Wanderer has different connotations in different cultures. English teachers in Las Vegas high school classrooms have always taught some of the most famous parts of Homer’s Odyssey—the heroic story of Ulysses, the most famous wanderer. Ulysses wandered in and out of a lot of trouble… Planets are wanderers, too. During ancient night times, ancient shepherds looked up and watched them meandering restlessly among the stars, so they called them planets (“wanderers”). Dion (of Dion and the Belmonts) was the most celebrated wanderer of the 60s—at least his hit song claimed that he roamed “around around around around”). In today’s Las Vegas culture, though, wandering is a lot less glamorous than it’s been through most of history. A modern definition includes the bit about moving around, but most dictionaries include less-than-positive modifiers like “aimless” or “without plan or purpose.” So when Federal Reserve Chair Janet Yellen gave a recent speech that Las Vegas mortgage rate observers hoped would signal the direction where rates are headed, they expected clarity on the Fed’s plan and purpose. Last Thursday, The Washington Post headlined the following days’ financial reaction: “Mortgage Rates Wander Higher but Remain Near Yearly Lows.” When financial writers talk about mortgage rates that “wander,” it doesn’t really matter in which direction. It means that they’re going up and down in what amounts to wandering’s “aimless manner.” If it signals anything, it’s mainly that the signals from all corners are mixed. At Jackson Hole, Chair Yellen had signaled that the central bank “is moving closer” to raising their benchmark rate, but it seemed that the signal was not too convincing: Bankrate.com found that nearly 90% of the experts it talked to think rates will remain unchanged for a while. As for how the Post could see rates “wandering” higher yet remaining near 2016 lows, it became clear in the paragraphs down below. The average 30-year mortgage rate had changed from 3.43% to 3.46%, remaining stuck in the range that’s lasted all summer (it’s been moving up and down no more than 7 hundredths of a percent). “Wandering” sounds appropriate. Freddie Mac’s Chief Economist said mortgage rates have been “hovering;” but “wandering” sounds at least as apt. What this means for Las Vegas real estate is perhaps the only really clear signal to emerge. For the moment, Las Vegas mortgage rates remain appetizingly low, keeping the residential market pegged at historical bargain basement levels. Best of all, that means it’s still a great time to give me a call!
TICK TICK TICK TIME AND LAS VEGAS REAL ESTATE INVESTMENTS
“Time is of the essence!” is the kind of everyday phrase you might hear any time in Las Vegas. Most often it’s tossed off casually—as when someone gets impatient, waiting for a friend who’s been dillydallying. That’s when it means “we’re gonna be late!” In Texas legal contract phraseology, it has a more precise (and serious) meaning. To lawyers, including that phrase means that the parties must perform X by date Y or else! It means that missing a deadline will cause material harm. “Time is of the essence” in that connection is literal: the time element has value—it’s essential to the deal. When you examine an investment in Las Vegas real estate, the actual phrase doesn’t have to appear in any agreement docs for time to play an important part “of the essence” of the investment. This isn’t just some abstract philosophical notion—integrating it into your buying, selling and management decisions will certainly affect the concrete dollars-and-cents results. Most basic is a concept common to all investment avenues: the time value of money. The basic principle is that, provided money can earn interest, any given amount of money is worth more the sooner it is received. Most people are painfully aware of the inflationary effect of time on the money they earn—they know darn well that $1.13-a-gallon gasoline has become a distant memory (the same way great-grandparents used to describe 5¢ hamburgers). The importance of having not just a nodding-your-head understanding, but of having a believing-it-deep-down kind of understanding of this may be why mature investors can be more stubborn about sticking to spending limits. They’ve experienced the rate at which Las Vegas properties grow in value over time—which means that if they were to pay 8% or 9% over what they truly believe a home’s value to be, it could take a couple of years before its resale value would reach even a breakeven point. Thinking in terms of its time value—picturing it just lying there, inert, for a couple of years—makes for a less appealing proposition. For typical Las Vegas homeowners whose major reason for their real estate investment is as a residence, the time element works on many channels at the same time. The residence may lose some value as daily living’s wear and tear takes a toll, but at the same time, it’s all but sure to gain value through inflation. It might lose or gain as the immediate neighborhood changes for good or ill—although it could gain considerable value through wise decorating initiatives. About those decorating initiatives: it’s a canny homeowner whose first efforts at home improvement come in the garden: the right trees planted today can become hugely beneficial a decade or two from now—and hugely expensive to try to duplicate later. If you’ve ever discussed the cost of craning in a 25-foot shade tree, you understand the reality of “time is of the essence!” The hot spring-summer selling season is set to start cooling down, but there are loads of great Las Vegas properties on the market right now. Call me, because time is of…well, you know!
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