Fourth quarter sales for 2010 at the MGM Signature Hotel were a bit of an anomaly. Sales of any real estate product are always lower in the first and last quarters of the year than the second and third, however I did expect increasing foreclosure rates to drive sales numbers higher than usual in the last part of 2010. What happened instead, was yet another foreclosure stall in the wake of the Bank of America robo-signing fiasco. With foreclosures slowing to a trickle, the inventory of bargain priced units in the MGM Signature complex dwindled considerably. This created an interesting paradigm in which sales volume and average sales price dipped in the final quarter, but lack of new foreclosure inventory created a new framework for sales expectations moving forward into 2011.More specifically: The 4th quarter of 2010 saw the fewest number of one-bedroom sales in well over a year at only 15 units. The average price for a one-bedroom MGM Signature unit (847-874 sq. ft.) in the 4th quarter was $218,000...well down from the 3rd quarter average of $227,000. The average price for a studio unit (520 sq. ft.) was $151,000 down from the third quarter average of $155,000. Sales on studios (also referred to as junior suites) was down to 48 units from the third quarter volume of 53 units.
What is extremely interesting however, is that although sales volume was down in the 4th quarter...new listings were down even more. At the close of the third quarter, there were 73 units listed for sale at the MGM Signature Hotel Condo. By the close of the fourth quarter, there were only 55 units listed for sale. This is a drop of 25%. Also interesting to note is that the percentage of listings that are conventional (as opposed to short sales or foreclosures) is climbing as well (usually a sign that precedes price recovery). At the end of the third quarter, 40% of the units listed for sale in the MGM Signature complex were short sales or REO properties. At the close of the fourth quarter, that number dropped to 22%.
It’s tough to say exactly where things will go from here at the MGM Signature. If inventory remains as light as it is now, I believe that we will see prices begin to steadily climb. However, if foreclosures accelerate in 2011, we may continue to see some deals holding prices steady. I continue to believe that we have bottomed out on prices at the MGM and that we will hold reasonably steady or begin to climb. It is a great time to purchase an investment or second home property at the MGM Signature...both interest rates and prices really have no where to go but up.
I was the second biggest mover of MGM units in 2010 and the fourth busiest buyers’ agent in all of Las Vegas. If you are interested in purchasing a unit (or a fractional share of a unit) at the MGM, please contact me for more information on the property and all your available options.
Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com
www.glennplantone.com or www.vegasforeclosures.blogspot.com
