Vegas Foreclosures

Glenn Plantone Featured Again in CNN Money

2012-01-05T13:52:00.000-08:00

Once again, Glenn Plantone has been featured as an expert commentator in a recent article from CNN Money. This piece by Les Christie was featured in CNN Money on Nov. 11, 2011 and is titled "Is Las Vegas' Housing Market Ready to Make a Comeback?" Excerpts from the article follow:

"NEW YORK (CNNMoney) -- Las Vegas has suffered through the housing bust like few other places and still has further to fall. But these days many real estate investors and home buyers are betting that it's poised to stage a comeback.

Sin City's metro area led the nation in mortgage defaults for 22 straight months through August and home prices plunged a whopping 60% from their 2006 peak, according to RealtyTrac. And prices still have further to fall. Financial analytics company, Fiserv, projects home prices in Las Vegas could fall another 16% by next June.

But to investors and home builders, there are enough positive signs to start betting on Vegas now.

Home sales, especially of bank repossessions, have picked up signi cantly. Nearly 36,000 homes have been sold so far this year through September 30, an 11% increase compared with the same period in 2010, according to Lawrence Yun, chief economist for the National Association of Realtors.

Glenn Plantone, a Vegas-based broker and investor who deals mostly in foreclosed properties these days, said he's seen an infl ux of foreign buyers, especially from Canada and China. Last year, he brokered 25 sales but this year he's already up to 65.

"I'll triple my business this year," he said.

According to CoreLogic data, 63.3% of homeowners there are underwater on their mortgages. As a group, Las Vegas mortgage borrowers owe about 20% more on their mortgages than the value of their homes. Many will lose their homes to foreclosure.

But for all of those who lose their homes, there are others who see it as an opportunity. More than 50% of all sales in town are foreclosures, said Plantone.

Recently, he had a client who made bids on 40 diff erent bank-owned properties. He was outbid each time. The investor wound up buying four new 1,400 square-foot homes in North Las Vegas for $140,000 each instead. He rents them out for $1,495 a month apiece, which give him immediate returns on his investment.

Once the housing market recovers he could sell the properties for a healthy return, too. It's hard to beat those kinds of odds."

Team Plantone Offering Chase Foreclosures to Investor Buyers

2011-11-21T12:20:00.001-08:00

On Friday, November 18th, Chase delivered to Team Plantone a list of 35 foreclosure properties in Las Vegas, NV that need to be liquidated immediately. Originally these properties were to be listed and sold only to owner occupants, but due to the current credit crunch and the difficulty many primary buyers are having obtaining financing for their purchases, Chase has decided to open up the list to investor buyers as well. The catch is that potential investors must move very quickly. All offers must be in place for this package by Wednesday, November 23rd.

There is no bidding on these properties. The price is the price. Interested investors simply look over the list and if a property they want is still available...it is theirs. It is that simple. This type of REO / foreclosure liquidation is extremely advantageous to the investor buyer because the investor is able to avoid the bidding wars and resulting price increases that plague cash buyers looking to purchase REOs through traditional listings in the extremely popular Las Vegas real estate market.

There are some great spreads in this lists for buy and hold investors. There is also a 2% commission available to any licensed buyers’ agents. Chase is only accepting cash offers.

If you are interested in viewing a list of the available properties, please contact Glenn Plantone immediately.

Glenn Closes 15 Property Bulk SFR Deal

2011-11-17T09:59:00.000-08:00

Glenn Plantone of Nevada New Builds LLC in Las Vegas recently completed a bulk sale of 15 new construction homes to a private, out of state investor. The transaction, which closed on November 1st, 2001, represents one of the largest single transactions of single family homes in the Las Vegas valley this year. The transaction was an all cash deal that closed in 7 days.

The bulk package consisted exclusively of new construction foreclosures located in the Providence neighborhood of northwest Las Vegas. Most homes were 4 bedroom and averaged around 2300 square feet. The entire purchase closed for under $2M. The buyer plans on holding the homes long term and generating cash flow through renting, lease optioning and (possibly) offering owner carry programs.

This most recent deal is typical of the types of packages that Plantone and his team construct for their clients. Team Plantone specializes in acquiring distressed properties through short sales, builder closeouts, REO packages, and Trustees’ sales. The team then renovates the properties, clears any liens on the property, and adds great extras like ceiling fans, landscaping, upgraded fixtures and appliances. Plantone and his team then place long term tenants in the properties to create a turn-key investment. Because the properties have been acquired so far below market value, they can be resold to Plantone’s investor clients with CAP rates of 10% or more after all expenses.

Plantone and his team of seven professionals tailor their services to investors looking to purchase income property in Las Vegas. Team Plantone represents buyers that purchase more homes in Las Vegas than any other group. This includes teams that employ as many as 30 people or more. “We focus on our clients needs first,” Glenn said, “I have been a real estate investor for over 10 years, so I understand what investors are looking for...strong cash flow, good appreciation potential and security. We’ve been seeing a lot of money lately moving from the stock market into real estate. Buyers realize that we are seeing historically low prices and interest rates and that now is the time to buy.”

Many of Team Plantone’s clients are from Canada and China as the rest of the world rushes to capitalize on this buying opportunity. Like many other analysts, Glenn agrees that it may take Las Vegas another 5-7 years to recover from the current housing crisis and that investors will probably not realize significant appreciation until that happens. He still feels, however, that now is an excellent time to buy. “Cash flow is the key factor to examine when determining whether or not an investment is solid. We are currently seeing cash flow rates that haven’t existed in Las Vegas in five decades.”

If you would like more information on the Las Vegas real estate market or bulk investment packages, please contact Glenn directly.

Finally...Loans for Canadian Investors Looking to Purchase U.S. Real Estate

2011-11-03T18:23:00.001-07:00

Over the last three years I have sold dozens of properties to foreign nationals looking to invest in Las Vegas real estate. Las Vegas has led the nation in foreclosures for the last three years running and has seen properties lose 50-80% of their value. Rents, on the other hand, have declined only a fraction of that percentage and, as a result, Las Vegas investment properties are cash flowing at a rate we haven’t seen in decades. Many foreign nationals, especially Canadians, who are familiar with Las Vegas as a vacation destination, are now looking to Las Vegas as an investment destination as well.

The only downside, for some Canadians, to investing in Las Vegas foreclosures has been the inability to use financing to leverage their investment. All of my Canadian buyers have had to pay cash for their investments because reliable financing for foreign nationals was simply not available through U.S. financial institutions. Until now.

I am excited to announce that Team Plantone has recently established a relationship with an established lending institution here in Las Vegas that has developed a loan product for Canadians looking to purchase 2nd homes in the U.S. and a separate loan product for foreign nationals looking to purchase investment property.

The second home purchase program especially for Canadians will fund 65% loan to value on single family residences with a minimum loan amount of $75,000. A Candadian credit report with a minimum score of 680 is required along with income and asset documentation. Competitive fixed rates are available on 30 year terms.

The foregin national investment property product will fund up to 60% loan to value on residential properties with 1-4 units. There is no minimum loan amount and no proof of income or credit score required. Loans are amortized over 40 years and 3 and 5 year terms are available with rates starting at 8%. Even more encouraging is that the financial institution is able to order their own appraisal.

If you are a foreign investor interested in learning more about these programs or about investing in Las Vegas real estate, please contact Glenn Plantone for more information.

Glenn Opens Up Fixed Interest Program to Smaller Investments

2011-10-25T15:48:00.000-07:00

For the last two years, we have been successfully flipping homes in Las Vegas using our proven formula. We purchase distressed properties well below current market value via short sales, the trustees’ auction and bank-owned REOs. We then rehab these properties to better-than-new condition and place quality, long term renters and lease option tenants in the properties and sell them to investors looking for turn-key real estate investments with solid cash flow and strong appreciation potential. Last year we flipped over 25 of these properties and this year we have already more than doubled that effort.

In order to fund our acquisition and rehabilitation costs, we have brought in private investors who have put up the funds for one or more properties at a time. We offer these investors a guaranteed 10% return on their money. Not only are the investments secured by a first position lien on the property, but we also guarantee the 10% return regardless of the success of the flip. During the last two years we have never missed a payment to an investor! (We have detailed documentation on each and every flip we have completed and are happy to provide this information to prospective investors upon request. We also have references available from current investors.)

Over the last couple of years, many investors have approached me looking to get involved in our projects and take advantage of these phenomenal (and secure) returns. Unfortunately, I have had to turn potential investors away if they didn’t have at least $100,000 available to commit to the project. The way our deals were structured, we weren’t able to allow investors to fund only a portion of an acquisition, we had to have one investor per property.

We are thrilled to announce that this has now changed. We have recently restructured our operating agreement in order to create an opportunity for investors to get involved with as little as $20,000. Our new investors will still receive a guaranteed 10% return on their investment and their investment will be backed by the real estate itself. Payments will be made quarterly and investors may exit the program at any time with 90 days notice.

If you are interested in learning more about how to make more than 5 times the current savings rate of return, please contact Glenn for more information.

Bank of America Agrees to Allow Buyer Substitutions on Approved Short Sales

2011-10-13T15:43:00.000-07:00

Bank of America announced recently that it will now allow agents to substitute buyers into approved short sales in cases where the original offer falls through. This news was greeted with enthusiasm from real estate agents, investors and potential home buyers. Many real estate professionals view it as a much needed and long awaited step forward in helping to boost the success rate of the short sale process.

The biggest hurdle facing short sales is the long timeline associated with obtaining bank approval. (Short sales typically take between 60-90 days to be approved.) Because of the uncertainty and lengthy waits involved in purchasing a short sale property, many potential home buyers submit multiple offers and/or continue looking while the short sale negotiation is in process. Many times, if a successful agreement is reached with the bank, the potential buyer has long since moved on to another property.

This is what makes Bank of America’s new policy so helpful. According to their new guidelines, Bank of America will allow the listing agent on the short sale property to substitute a different buyer at the agreed upon price without reapplying for approval from B of A. While this is certainly not a silver bullet, it is a tremendous improvement to the short sale process and one that we hope other major banks will adopt as well.

Las Vegas has seen the highest percentage of foreclosures and short sales in the nation. Over the past three years, we have consistently purchased distressed properties through short sale offers and placed them in our rehabilitation program. As part of this program, we completely renovate the homes to move-in ready condition, place a quality, long term tenant in the property, and then resell the home to one of our investor clients looking for a turn-key buy and hold investment with strong cash flow and upside appreciation potential. We have had tremendous success with this win-win scenario. Our investors are averaging returns between 8-10% for cash purchases and 12-24% for financed deals. We are also providing quality rental housing for the large percentage of Las Vegans who find themselves unable to purchase a home at this time.

If you are interested in taking a closer look at the strong returns that are currently available in the Las Vegas real estate market, please contact me. I am currently offering complimentary two night stays at the MGM Signature for qualified out of town investors. Call me for details.

Glenn Plantone
Wynn Realty
(702) 656-3264 xt: 203
gsplantone@gmail.com

An Open Letter to Appraisers In the Las Vegas Real Estate Market

2011-09-10T10:39:00.000-07:00

For the last three years, my team and I have purchased, renovated and resold over 100 properties in the Northwest Las Vegas area. Currently, our greatest challenge lies not in construction headaches, buying competition or even the scarcity of financing but in obtaining fair appraisals for our renovated homes that are re-entering the market.

Our business model consists of purchasing homes at a discount (REOs, trustees’ sales, and short sales), fixing them up, and selling them at today's retail value. Our properties sell at the top of the market because of the quality that we put into them. Most of our homes are literally better than new construction. We only rehab houses that are 10 years old or newer, and then we put in lots of upgrades that builders do not: landscaping, ceiling fans, blinds, upgraded flooring and fixtures, complete appliance packages (often including washer and dryer.) Of course, we also include new carpet, new (non-white) paint, and the like.

Even though our properties are generally better than any other homes available in the neighborhood, we still generally price them below the highest recent comp for the area. This is because we know that because our property is a flip (being resold within 90 days of our purchase) it is going to be more closely scrutinized by the lending bank and will often require two appraisals.

Our request to you, the appraiser, is simply that you compare apples to apples when drawing up your appraisal. As you know, most distressed properties (REOs and short sales) are in very poor condition. Our homes are not distressed and as such they sell for a price higher than trustees’ sale purchases, REOs, and short sales. When you are looking at comparable sales in the area, we would ask that you compare non-distressed sales and not use REOs and short sales in your comps, just as you would not use trustees’ sale data. We understand that non-distressed homes are the minority at the moment and that REOs and short sales make up as much as 75% of the resale market at this time. However, there are sufficient examples of non-distressed sales in the area to paint an accurate picture of comparable value.

According to Larry Murphy (of Las Vegas Crystal Ball and SalesTraq) certain types of homes are currently selling for certain dollar amounts per square foot in the Las Vegas marketplace. As of June 2011, Murphy released figures based on his exhaustive database of recent sales that shows that trustees’ sale homes are currently selling for around $65 per square foot, bank owned foreclosures (REO’s) for about $71 per square foot, short sales for around $80 per square foot, non-distressed properties at $88 per square foot, and new construction at $100 per square foot.

We appreciate your efforts to use the right types of homes in your market research during this challenging period in the real estate market.
Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com

If you’d like to see more of Glenn’s articles, follow his blog at:
www.vegasforeclosures.blogspot.com

Double Dip? Probably, But That Shouldn’t Scare Real Estate Investors Away

2011-09-07T13:30:00.000-07:00

As a full time real estate investor, with a portfolio of over 20 properties in several states, as well as a licensed Realtor, I have made my living by following the trends and helping my investor clients to do the same. For the last four years, those trends have kept me here in Las Vegas, NV...the foreclosure capital of the United States. I have risen to become the 4th busiest buyers’ agent in all of Las Vegas for two of the last three quarters, selling almost exclusively to investors who have come rely on my advice and ability to find strong, cash-flowing, turn-key investment properties for them.

Many of my clients have been asking me if Las Vegas home prices are heading for a “double dip” as the recession continues to drag on. I don’t know if I would call it a “double dip” since I definitely don’t predict that home prices will experience any further drastic declines in the Las Vegas market. I do, however, believe that home prices will continue to trickle downward until the economy as a whole begins to really improve.

So, in light of this prediction, what advice am I giving investors now? BUY, BUY, BUY! I can’t say it strongly enough that now is the time to buy investment property in Las Vegas. Why? Three major factors:

1. After losing between 50% and 70% of their peak value, average property values in Las Vegas have continued to decline over the last year at the rate of approximately 1% per month. To put this number in perspective, it means that a home that was worth $115,000 in May of this year will have been lowered in value to about $112,000 as of today. These decreases might scare away the average investor, but it is important to note that the key factor when decided where to invest should be CASH FLOW. If a property has a strong rate of annual return at the price you are currently purchasing it, then it can be a very good investment even if prices dip slightly over time before they inevitably recover. Because home prices have plummeted much lower than rents over the last several years (home prices falling around 70% and rents only 15%), cash flow in Las Vegas is stronger than we have seen it in the last five decades. We are currently achieving 8-10% CAP rates for our cash buyers and over 15% for our financed buyers.

2. Interest rates are currently at lows that we are unlikely to see again in our lifetimes. Once the economy begins to recover, interest rates will be the first things to change...and quickly. Interest rate hikes usually precede the general public’s notion that a recession has ended. Purchasing property now with a low interest rate will save the savvy investor thousands of dollars in the long run over trying to pick the exact bottom of the real estate market.

3. Lastly, demand for properties in Las Vegas is even higher than statistics may indicate. June of 2011 saw over 5500 single family homes close in the Las Vegas market, but many more untold numbers of buyers would have purchased a home if not for the continued difficulty in obtaining financing, difficulties getting appraisals that match sales prices, trouble finding homes to purchase that haven’t already been snatched up by cash buyers, etc. When credit availability improves, appraisals rise to reasonable levels and distressed properties take up a smaller portion of available inventory, we will likely see an influx of buyers that have been trying to purchase homes but have not yet been able to do so...this influx will inevitably drive prices up.

Many potential investors are understandably nervous about the rocky ride we have been experiencing in real estate over the last several years. I encourage you, however, to take a good look at the facts. Now is a great time to invest in real estate...probably the best time to invest since the Great Depression. Savvy investors...make your move.

If you are interested in purchasing Las Vegas investment properties or learning more about the Las Vegas real estate market, please contact Glenn Plantone.

Las Vegas Real Estate: A Matter of Perspective

2011-08-18T11:03:00.000-07:00

Like anything in life, it’s all about perspective and how we choose to look at a situation.
We all have the same data about the housing market available to us. For some, the data reads bleak... this is the worst real estate market ever (at least since the Great Depression). For others, it is the opportunity of a lifetime (also like the Depression if you were around to accumulate real estate at that time).

I ask this question: If the market is so terrible, why are cash investors flocking to Las Vegas, scooping up homes at record levels, and paying cash for them? My perspective, along with most of the other happy, cash investors, is that this is truly the opportunity of a lifetime and we are taking advantage of it now while the iron is still smoking hot. Over 5500 homes were sold in Las Vegas in June of this year (2011). This is the most since August of 2005, the heyday of Las Vegas real estate. But this time around, statistics show that nearly 55% of purchasers are cash buyers and nearly 80% are investors buying up what they can as fast as they can. In 2005 the percentage of cash buyers was very low and the percentage of owner occupied properties was much higher. With prices dropping nearly 70% over the last 4 years, investors are getting rates of return between 8-12% on cash investments and 15-25% on financed investments. The only downside seems to be that with all of this demand, actually acquiring one of these great Las Vegas investment properties is not as easy as you might think.

Just how cheaply you can acquire investment property in Las Vegas in 2011 depends on what type of property you are purchasing. Each form of purchase has its own distinct advantages and disadvantages. Foreclosure properties that are liquidated at the Trustees’ Sale usually fetch around $55/sq. ft. The Las Vegas Trustees’ Sale represents the least expensive and simultaneously the most difficult way to acquire property. You must come to the sale daily in order to bid on properties that can be seemingly endlessly postponed, you must bring all cash to purchase the property, and even then, you are often competing with several other cash buyers on a property that is sold “as is” with no disclosures and limited opportunity to view the property beforehand. I do not recommend the Trustees’ Sale as a means of acquiring property for any but the most experienced professional.

Bank owned foreclosures (or REOs) are currently selling for around $64 per square foot in the Las Vegas market. These properties provide greater visibility for the purchaser and allow for financing options, but the rather substantial downside to this is that the REO market in Las Vegas has become extremely competitive. It is very rare, at the moment, to encounter an REO listing that does not turn into a multiple offer situation, with bidding wars often raising selling prices to well over $75/sq. ft.

Short sales are the next cheapest way to acquire Las Vegas investment property...usually being approved at around $70/sq. ft. This is still a bargain compared to the average closing price of $78/sq. ft. for non-distressed sales and $98/sq. ft. for new construction. Like auction properties and REOs, however, short sales are very rarely in move-in ready condition and usually require some level of renovation before they are ready to rent out. While less competitive than REOs, short sales require lots of time and patience and result in lots of “misses” for every “hit.”

I have become the third busiest buyers’ agent in all of Las Vegas by dealing exclusively with investors that are looking to take advantage of this phenomenal buying opportunity in Las Vegas but want to avoid the stress of hunting for properties on the open market. My team specializes in sniffing out all the best bargains in Las Vegas. We purchase properties from the Trustees’ Sale, from banks, as short sales, and occasionally from private owners and builders. We then rehab these properties to better-than-new condition, find and place a quality long term renter or lease option tenant in the property, and then sell them to our investor cilents for prices that are still below $70/sq. ft. and allow for CAP rates of 10% and higher. Wynn Realty offers in-house property management and renter placement, which works extremely well considering the majority of our clients are from out of state or out of the country.

If you have been sitting on the sidelines, waiting for a good time to act on the greatest real estate buying opportunity of our lifetime...maybe today is a good day to call. I’d love to speak with you.

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com

If you’d like to see more of Glenn’s articles, follow his blog at:
www.vegasforeclosures.blogspot.com

MGM Signature 1st and 2nd Quarter Update 2011

2011-08-08T12:10:00.001-07:00

I predicted in my final quarter MGM Signature update for 2010 that we would see sales begin to pick up slightly at the MGM during the beginning of 2011, but that sales might become volatile after that time due to lingering uncertainties in the economy and housing market. As predicted, sales did accelerate with 73 units closing in the first quarter of 2011 (51 studios and 21 one-bedroom units.) By comparison, there were 63 units sold at the end of 2010...an increase of almost 20%.

The highest priced studio closed for $214K (unit #135-3507) and the lowest priced went for $112K (unit #135-2318.) This resulted in an average of $159K for studios. The high sale for one-bedrooms was $335K (unit #135-3001) with the low sale coming in at an amazing anomaly price of $138K (unit #125-1102.)

The most significant trend I spotted as we moved into the second quarter of the year, was the drop in inventory and sales and the corresponding rise in average sale price. In the second quarter of 2011, only 31 studios sold (as opposed to 51 in the first quarter) and only 10 one-bedroom units closed (21 in the first quarter.) Simultaneously, we saw the average sale price for studios climb from $149K in the first quarter to $159K in the second.

The gradual climb in price that we have seen at the MGM over the last several months corresponds with my prediction last year that we had seen the bottom of the market for high rise units in this development.

There are three major points that indicate that we will continue to see prices rise gradually at the MGM:

1. There are a total of 1824 units in the MGM Signature Hotel Condo development. Of these, over 700 units have turned over since their original sales dates. This is nearly 40% of the total and represents a disproportionately large number. This means that most of the investors who needed to get out when property values tanked have done so, and those that remain have most likely decided to hold out for the long haul. This means that we will, most likely, not see another large wave of foreclosures and the accompanying price cuts that they produce.

2. Lack of inventory...with the majority of “fire sales” now being completed, we are seeing the available inventory at the MGM continue to shrink. Less supply with steady demand necessitates price increases.

3. By reviewing the docket for upcoming Trustees’ Sales, we are able to see how many units are going to be available at a discounted price. Currently, inventory at the Trustees’ Sale has slowed to a trickle.

All of these items point to the fact that anyone interested in purchasing at the MGM Signature needs to take a serious look at the available units before prices move beyond their current levels. Unfortunately, it can be very difficult to purchase a unit at the MGM. Competition for available, reasonably priced units is fierce. I am the number two salesman at the MGM and I still have difficulty getting my clients good units, or sometimes, any units at all. In order to combat this competition, I look for great deals at the Trustees’ Sale, through REOs, with short sales, and regular listings.

If you are interested in purchasing at the MGM Signature, as an investor or for personal use, or if you are a current owner looking to review your options, please contact me directly and I will be happy to share my expertise on this development with you.

Observations: The Las Vegas Foreclosure Market for Summer 2011

2011-07-11T10:27:00.000-07:00

As many of you know, my core business involves purchasing foreclosure properties at the Las Vegas Trustee’s Auction, renovating them to better-than-new condition, placing long term renters or lease option tenants in the properties, and then selling them to my investor clients as turn-key, cash flowing investments. Last year I was able to successfully turn over 25 such foreclosure properties. Half way through 2011, I am on pace to more than triple that number.

But, lately, there has been a hitch...a speed bump so to speak. The foreclosure auction just doesn’t have very many foreclosures. My team has found that where we were able to easily identify and purchase multiple foreclosures weekly only a couple of months ago, now we are struggling to find good deals on Northwest Las Vegas properties. Our personal experience is being backed up by the latest statistics.

Realty Trac recently released data showing that notices of default in the Las Vegas Valley fell to 2,701 in April down from 4,600 in March. That is a huge decline.

So does this data point towards an over-all economic recovery? Not necessarily. RealtyTrac Chief Executive Officer James Saccacio believes that the slow down is a result of delays from lending institutions in processing foreclosures. However, a recent report from CoreLogic shows that the 90-day delinquency rate for Las Vegas has steadily decreased over several months.

Regardless of the impact that declining foreclosures will have on the overall economy, one thing is certain: We will continue to hunt down the best Las Vegas real estate deals for our customers, as we have for the last three years. In the past, when foreclosures have not made financial sense, we have turned to short sales and REOs. We have already begun to shift our acquisition strategy yet again. As I mentioned in a series of artciles in 2009...being a successful real estate investor means being a chameleon...constantly able to adapt and change to fit current market conditions. As we change our strategy, we will keep you abreast of current developments in the Las Vegas foreclosure market.

If you are interested in learning more about investing in the Las Vegas real estate market please contact me for more information.

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com

If you’d like to see more of Glenn’s articles, follow his blog at:
www.vegasforeclosures.blogspot.com

What is a Good CAP Rate? What Makes a Good Return on Investment?

2011-06-08T18:02:00.000-07:00

In my last article, I discussed how to calculate the three most common ratios used to determine the rate of return on real estate investments: Capitalization (CAP) Rate, Return on Investment (ROI), and Equity Return Rate. Of these, the most commonly used is CAP rate. However, it is actually the ROI that provides you with the most accurate picture of whether or not a particular income property will make a good investment.

Because it is so popular, we will discuss CAP rate first. A 10% CAP rate is often referenced as a goal to shoot for. In general, most areas of the country will have CAP rates that max out at 8-12%. Because Las Vegas has led the nation in foreclosures for the past three years and counting, home prices have plummeted to as low as 30% of their former highs. Rents, however, have only declined moderately. As a result, Las Vegas is currently offering the highest CAP rates available in the United States. For the last three years, I have specialized in purchasing Las Vegas income properties dirt cheap at the foreclosure auctions, renovating them to move-in condition, placing renters or lease option tenants in them and selling them to my investor clients as turn-key investment opportunities with CAP rates that average 10-20%. If you are interested in this type of investment opportunity, please contact me for more information.

Moving on, the better way to evaluate potential investment properties is by calculating Return on Investment or ROI. (If you aren’t sure what this is or how to calculate it, see my previous article on the topic.) ROI portrays what your return is on the money that you have actually put into the project. This provides us with an interesting comparison. If you purchase a property for cash and that property provides you with a 15% CAP rate, then your ROI will also be 15%. However, if you purchase that same property using some form of financing, then your ROI will be much, much higher. As long as you are purchasing properties that have positive cash flow, after all mortgage notes and other expenses are paid, it is always better to purchase using financing in order to maximize your rate of return. We are currently offering our investor clients Las Vegas rental properties that are providing annual ROIs with 25% down of between 20-40%.

The important thing to remember when shopping for investment properties in Las Vegas, or anywhere, is that good deals will always stand up to scrutiny. You should always ask for a detailed proforma or create your own for any investment property that you are considering purchasing. This will insure that you find the best investment properties for your investment dollars.

If you are interested in learning more about investing in the Las Vegas real estate market please contact me for more information.

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com

If you’d like to see more of Glenn’s articles, follow his blog at:
www.vegasforeclosures.blogspot.com

Understanding CAP Rate, Return on Investment (ROI), And Equity Return Rate

2011-05-11T15:55:00.000-07:00

When you are looking to purchase income property for investment purposes you are bombarded with various statistics designed to show you the strength of the investment you are considering. These numbers can be very helpful IF you understand exactly what they mean and what constitutes a “good” rate of return. To help you accurately evaluate potential investment properties in Las Vegas and elsewhere, it is important to start with a working knowledge of the three main formulas used to evaluate potential real estate investments.

First is the Capitalization Rate or CAP Rate. You will probably see this formula used more than any other when describing the investment potential for a particular piece of real estate. The CAP rate is determined by dividing the NET Annual Operating Income by the Acquisition Cost of the property. NET Annual Operating Income is defined as the total of rents collected in a year minus all expenses associated with owning the property. These expenses may include: property taxes, HOA dues, any utilities paid by the owner, vacancy allowance, repairs/maintenance allowance, property management, and property insurance. Acquisition Cost is defined as the total cost necessary to purchase the property...so purchase price plus all closing costs, title and escrow fees, etc.

Using the above formula, if you acquired a property for $200,000 and the NET Annual Operating Income of the Property was $20,100, then you would have a property with a CAP Rate of 10%. In my next article, I will discuss how to determine a good rate of return.

The second type of return discussed with regards to income properties in Las Vegas and elsewhere is ROI or Return on Investment. If you paid cash for your investment property, then your ROI and your CAP rate will be identical. If, however, you purchased a property using financing, then your ROI will be the NET Annual Operating Income of the property divided by your initial equity investment (cash in the form of down payment, any out of pocket closing costs, etc.) Using this formula, we can see that if we purchased the same property as above and put 25% down ($50,000) then our ROI would be $20,100 divided by $50,000 = 40% ROI. As you can see, financed investments can allow you to leverage yourself into a much higher rate of return for your money than all cash purchases. We will touch more on that topic in my next article.

Another evaluation tool that is extremely useful in determining how much bang you are really getting for your buck is the Equity Return Rate. This is a slightly more complicated formula. The first step is to add your Cash Flow After Taxes with your Amount Paid Towards Principle and Change in Value to the Property. Cash Flow After Taxes, or CFAT, is simply your NET Annual Operating Income minus whatever taxes you paid on that income or plus whatever tax benefit you received because of your deductions for the income property. (During the first several years of property ownership, you will likely show tax savings and add them to your NET Operating Income in order to obtain your CFAT. In subsequent years, as your deductions mature, you will start subtracting taxes paid from your NET Operating Income to obtain your CFAT.) Amount Paid Towards Principle represents the total amount of your mortgage payments over the year that were applied to your principle balance. (On the first year of your property ownership this number will most likely be quite low and will grow each year.) Change in Value represents the amount that your property has appreciated or depreciated in the previous year. Once you obtain this sum, you divide it by your initial equity investment in order to obtain your Equity Return Rate. Using our previous example again: If your CFAT is $20,100 plus your Amount Paid Towards Principle of $1,627 and an appreciation of $6,000 (totaling $27,727) divided by your initial equity investment of $50,000 gives you an Equity Return Rate of 55% for your first year of ownership.

I specialize in offering quality, turn-key investment properties in Las Vegas to my investor clients worldwide. I ensure that all of my properties have a great ROI and Equity Return Rate. Tune in to my next article to learn how to determine what makes a “good” rate of return!

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com

If you’d like to see more of Glenn’s articles, follow his blog at:
www.vegasforeclosures.blogspot.com

What is a Participating Mortgage?

2011-04-07T09:01:00.000-07:00

You may have heard the term “Participating Mortgage” lately in conferences on real estate investment opportunities...but what, exactly, is a participating mortgage? And, more importantly, is it a good investment?

Participating mortgages have become more popular lately as investors who are frustrated by historically low returns in savings accounts and money markets, but who are unwilling to risk their funds in a very volatile stock market, look for secure investment opportunities that pay more than 1-2% annually.

As with traditional mortgages, an investor in participating mortgages lends money for the purchase of a home and receives, in exchange, a security interest (mortgage lien registered on title) for a specific real estate property, along with regular monthly payments at a given interest rate. The original investment is returned to the investor at the end of the loan term or upon the sale of the property. A participating mortgage, however, provides a greater benefit to the investor because it recognizes that the value of the real estate securing the mortgage loan may have increased over time. With a participating mortgage, when a property is sold, not only is the original capital paid back to the investor, but a portion of the profits realized from the increased value of the real estate as well. This profit sharing aspect, allows investors to capitalize on the appreciation of real estate without the responsibilities of finding a property, managing tenants, paying bills and maintaining the property.

Whether or not these investments are profitable depends almost entirely on whether or not the property securing the participating mortgage is acquired responsibly and at a reasonable price. Real estate investments in general have received a lot of bad press in the wake of the housing market decline, but the truth is that real estate remains one of the safest, most consistently returning long term investments available.

The key elements of participating mortgages are safety of capital, fixed monthly income, and profit sharing. If you think that participating mortgages might be a good fit for your investment portfolio, or are just interested in learning more about how they work, please feel free to contact me directly. I specialize in Las Vegas real estate investments and utilize participating mortgages for some of my investor clients.

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com or www.vegasforeclosures.blogspot.com

"Flip This House" Las Vegas Style

2011-03-29T20:49:00.000-07:00

I have been an avid fan of “Flip This House” since it debuted several years ago on A&E. I have watched as Than Merrill, Rudy Martinez, and the rest of the gang flipped foreclosures for profit in cities across the U.S. And sometimes, I’ve wondered to myself, where do they find these guys? Some of the decisions that I watch being made on the show are questionable at best, and the outcomes often seem a little...hmm, shall we say, overly optimistic? Many times, when they tally the expenses at the end of the show, there seem to be quite a few fees that are left out of the equation in order to make it look like the flips turned a profit, or perhaps a larger profit than they actually did.

As the marketing director for Team Plantone of Wynn Realty, I work for a house flipper here in Las Vegas that I would bet puts up numbers that can rival any of the stars on “Flip This House.” I have worked with Glenn Plantone for the last four years, and have watched him grow his team and refine his methods to best serve his investor clients. Last year, Glenn successfully flipped 31 properties in Las Vegas, mostly foreclosures and short sales, and this year he is on track to double or triple that figure.

Glenn actually has a very unique method for acquiring, flipping and reselling properties. Glenn starts by acquiring the properties either through short sales, at the foreclosure auction, or post-foreclosure through bank-owned REOs. Once the properties have been purchased, like the flipper on “Flip This House”, Glenn rehabs the properties to better than new condition. At this point, the similarities end. Most flippers, including those on the show “Flip This House”, liquidate their renovated properties to traditional owner-occupant buyers. Glenn takes the system a step further; by first, placing long term renters or lease option tenants in the rehabbed property; and second, selling the property as a turn-key investment property to his investor clients.

Since Las Vegas has led the nation in foreclosures for the last several years, there are many displaced families looking for rental housing. Glenn’s method provides these families with quality, affordable housing. Simultaneously, Las Vegas continues to be a hot spot for investors looking to capitalize on historically low home prices and high rates of cash flow return. Glenn’s method provides them with turn-key investment properties that couldn’t be easier to own...they are already renovated, professionally managed, and have a cash-flowing tenant in place by the time Glenn offers them for sale to his investors.

I have really enjoyed working with Team Plantone over the last several years and watching a true flipping professional in action. Maybe the “Flip This House” producers will take notice some day. After all, Glenn is posting numbers that should make him the number one buying agent in all of Las Vegas this quarter. Until then, we’ll continue to do our thing...flipping houses, Las Vegas style.

If you are interested in purchasing one of Glenn’s turn-key flips or, if you are interested in investing with Glenn, please contact him for more information.

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com or www.vegasforeclosures.blogspot.com

New Loan Program Makes It Possible for Non-U.S. Citizens to Borrow for Second Homes in the U.S.

2011-03-17T11:38:00.000-07:00

We recently received a notice from our lending partner that they have expanded their Foreign National Loan Program to include non-resident and non-U.S. citizens borrowing for second homes in the United States. This is great news for our Canadian clients (and other Foreign Nationals) who are looking to purchase a vacation home or first investment home here in Las Vegas.

We have sold a lot of properties lately to Canadian clients who are taking advantage, not only of the historically low prices and available foreclosures in Las Vegas, but also of the unprecedented strength of the Canadian dollar at the current time. This “perfect storm” of buying opportunity will not last forever. If you are a Canadian looking to purchase a great second home for yourself, for income, or both, now is the time to buy. We specialize in helping out of town investors understand all their options in the Las Vegas real estate market and we offer the best buying opportunities possible by taking advantage of Las Vegas foreclosures, REOs and traditionally listed properties.

Michael Lembo, loan officer at iMortgage, has outlined the following major qualifications for the Foreign National Loan:
Maximum Loan Amount of $417,000
30-year Fixed Rate Mortgage
30% Down Payment Required from Borrower’s Own Funds and 6 Month’s Reserve in a US Bank Before Closing
700 Minimum Credit Score with at Least 4 Trade Lines
36/45 DTI
Single Family Homes or Condos Allowed
Must Not Own Any Additional U.S. Property

If you would like more information on this loan product, or to discuss the current purchasing opportunities in the Las Vegas real estate market, please contact Glenn Plantone of Wynn Realty.

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com or www.vegasforeclosures.blogspot.com

Free Night at MGM Signature for Real Estate Investors

2011-03-10T11:12:00.000-08:00

There has not been a better time to purchase investment real estate in Las Vegas in the last quarter of a century. Over the last few years, home prices plummeted to those seen 20 years ago in 1991. But prices have now stabilized, and investors are finding that rents did not fall nearly as much as purchase prices. This means that investors are now able to purchase Las Vegas investment properties with extremely strong cash flow.

As the fourth busiest buyers’ agent in Las Vegas this year (and on my way to being the busiest agent in all of Las Vegas this year), I have purchased two suites at the MGM Signature Hotel Condos to accommodate my clients when they come to town to look at real estate. If you are a serious investor looking to explore the possibilities of the Las Vegas market, I would love to have you as my guest for a complimentary night’s stay at the MGM Signature Hotel Condo. We will spend the day touring properties in the valley that meet your investment criteria and you can spend the night enjoying all the amenities that the MGM Signature has to offer.

I have created a niche by catering to investors looking to purchase turn-key investment real estate in Las Vegas. I do this by acquiring properties at wholesale prices (purchasing them as REOs, short sales, or at the foreclosure auction), I then completely rehab the properties to like new condition and then place a long term lease option tenant in the property. This means that my investor buyers are able to purchase a property that has been completely rehabbed, already has a tenant in place with strong, positive cash flow, and is professionally managed and ready to go. This strategy makes it possible for out of town, out of state, and even international buyers to easily and profitably purchase Las Vegas real estate.

If you are interested in learning more about Las Vegas investment real estate and staying as my guest at the MGM Signature Hotel Condo, please contact me for more details. Of course, certain restrictions and conditions apply to the MGM free night offer. Call for more details.

Glenn Plantone
Wynn Realty
(702) 656-3264
gsplantone@gmail.com

www.glennplantone.com or www.vegasforeclosures.blogspot.com

MGM Signature Hotel Condos 4th Quarter 2010 Update

2011-02-22T17:33:00.000-08:00

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

Looking For Turn Key Investment Properties In Las Vegas? Looking to Invest IRA or 401K Dollars In Cash Flowing Real Estate?

2011-02-19T08:52:00.000-08:00

I am Glenn Plantone. I am the fourth busiest buyers’ agent in Las Vegas and I work exclusively with investors who are looking to purchase investment real estate here in Las Vegas. Many investors have been frustrated in their search for quality Las Vegas investment property. They have often found themselves in multiple bid situations trying to snatch up discount priced REOs, foreclosures, or waiting on short sale offers that never come through. Other investors are interested in moving their IRA or 401K dollars from under performing markets into real estate, but they may not now how to get started.

I work exclusively with investors, just like those described above, and I specialize in making it easy and profitable for my clients to acquire investment property in Las Vegas. Here’s how it works: I purchase distressed properties below market value via the Las Vegas trustees’ foreclosure auction, short sales and REOs. My team rehabs these properties to move-in ready condition and then we find a long term lease option tenant for the property. We package these properties, with tenant and property management already in place, as strong cash-flowing, turn-key investments for our clients. We are currently getting CAP rates of between 15%-35% for our financed investors and 10%-20% for our all cash buyers. These are phenomenal returns for very low risk, hands off investments.

You do not need to live in Las Vegas in order to buy in the best real estate investment area in the world. We have clients from all over the country as well as Canada and China. Our track record is stunning. Last year, we successfully completed 31 (pre- and post- foreclosure) rehab and sell transactions and we have satisfied customers for each of those transactions.

If you are interested in learning more about how you can invest in Las Vegas...the best area to buy investment real estate in the world right now...please contact me any time. If you would like to see some of the properties that we currently have available CLICK HERE.

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

Las Vegas Home Sales Fall in 2010...But For Interesting Reasons

2011-01-18T20:19:00.000-08:00

The Las Vegas Sun ran a front page article Monday, January 17th entitled “Home Sales in Las Vegas Slide in 2010.” The article reveals that “the sale of new single-family homes in Las Vegas in 2010 fell by 4.2 percent from a year earlier to its lowest point since the mid-1980s.” This statistic applies to new construction only. The article also notes that the sale of existing homes fell in 2010 for the first time in three years. Both of these statistics according to Home Builders Research.

4,753 new construction single-family homes were sold in Las Vegas in 2010. This is 207 properties lower than 2009, and the lowest mark for new home sales in Las Vegas in over 20 years. Las Vegas new construction saw its high point in 2005 with 30,829 homes sold.

Depending on which data you use, the sales of existing homes in Las Vegas dropped between 2-5% in 2010.

What is interesting to note, is why home sales declined in 2010. According to Dennis Smith, President of Home Builders Research, the main reasons for the decline were the end of the $8000 Federal new home tax credit in April and “a limited inventory of homes.”

While it may seem counter-intuitive, this comment by Smith is enlightening and lines up precisely with my ongoing reports of sales conditions here in Las Vegas throughout 2010. While demand, especially from investors, has continued to rise for Las Vegas real estate, the available supply of homes has dropped dramatically. According to Sales Traq, the average inventory of Las Vegas homes on the market in 2010 was 12,517, down from 13,926 in 2009. Bank repossessions also fell 10 percent in 2010 to 21,499, down from 24,000 in 2009. This was due largely to a self-imposed moratorium at the end of the year, the firm said. This has resulted in many potential Las Vegas real estate investors failing to close on investment properties in 2010. Some have wasted months chasing short sales, some have found themselves in multiple bid situations trying to purchase one of the limited REOs available, and some have simply temporarily given up looking and waited for the long anticipated “shadow inventory” of foreclosures to materialize.

While these conditions have frustrated potential buyers, I have sold more real estate in 2010 in Las Vegas than ever before. I have developed a buying system that has allowed me to successfully locate and purchase quality investment properties for my investor clients at great prices. If you are interested in purchasing great, turn-key investment properties in Las Vegas, or simply want more information on this volatile market...please don’t hesitate to contact me.

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

Las Vegas Foreclosure Listings Present IRA Investment Options

2011-01-10T21:42:00.000-08:00

The recent wave of Las Vegas foreclosure listings have created unique opportunities for those looking for IRA investment options that include purchasing Las Vegas real estate. Over the last two years, Las Vegas has led the nation in foreclosures. Because of this wave of supply, property prices have plummeted as much as 80% in some areas of the Las Vegas valley. It is now possible to acquire single family homes that are only 3-5 years old for as little as $35,000.

It is interesting to note, however, that while property prices have dropped significantly in Las Vegas during the last three years, rents have declined only moderately. This has created levels of positive cash flow for Las Vegas investment properties that hasn’t been seen in decades. It is now possible for investors to roll over their 401K or IRA accounts into self-directed IRAs that allow them to buy investment property tax free and without penalty. These IRA investment options are extremely attractive for investors looking to purchase secure properties with solid appreciation potential and strong positive cash flow.

We are currently purchasing short sale and foreclosure listings, rehabbing them, and selling them to investors with long term renters in place. These turn-key investment properties are generating average CAP rates of around 12%. A typical example would be 3 bedroom, 2 bath townhome constructed in the last five years that rents for $1100 per month and sells to an investor for $76,995.

If you are interested in purchasing one of these turn-key investment properties or would like to hear more about Las Vegas foreclosure listings or IRA investment opportunities in the Las Vegas real estate market, please contact Glenn Plantone:

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

Real Estate Investing in Las Vegas Returns to Historic Trend

2010-12-28T11:30:00.000-08:00

Real estate investing in Las Vegas is back on the historic trend lines according to the latest market data to be released by title companies. This is both good and bad news.

What this means is that real estate prices for single family homes in Las Vegas, which shot up disproportionately for three years beginning in 2004 and peaking in 2007, have now returned to the trend line that they always “should” have followed.

This may be bad news for some homeowners who purchased during the 2004-2007 price boom and were hoping for a speedy market recovery to recoup their recent losses. Instead, what will most likely occur, is a slow, but steady rise of real estate prices here in the Las Vegas valley that mirrors the average national appreciation rate of approximately 5.4% annually over the past five decades. At that rate, many of these distressed Las Vegas homeowners may have to wait 10 or more years to see their properties return to their purchase price.

However, this return to the average trend lines may be good news for new investors flooding to the area to try their hand at real estate investing in Las Vegas. Now that the average trend line has been reached, it seems unlikely that property prices will drop much further. And, because rents have not declined nearly as much as property prices, rental units are cash flowing better than ever in the Las Vegas valley. This creates a perfect investment opportunity where investors can receive monthly positive cash flow on their properties and expect steady, yearly appreciation.

If you are interested in learning more about real estate investing in Las Vegas, please contact Glenn Plantone.

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

New Ways for Las Vegas Mortgage Brokers to Earn Commissions

2010-12-09T12:44:00.000-08:00

The credit crunch and economic downturn have affected everyone here in Las Vegas, but perhaps none so much as those looking for financing for a home and those who make their living locating that financing. If you are a Las Vegas based mortgage broker or other finance professional and have had to turn clients away because they cannot meet tightened credit guidelines...we have a solution, for you and for your clients.

We specialize in purchasing quality, newer homes in great neighborhoods. We acquire these properties for well below current market value through bank-owned REO foreclosures, short sales, and trustees’ foreclosure auctions. We fully renovate these homes so they are turn-key and move-in ready. We then offer them to buyers who, like your clients, want to purchase a home but are not quite ready to qualify for traditional funding at this time. We offer lease option contracts of anywhere from 1 to 5 years based on your recommendation of how long it will take your buyer to improve their credit and become eligible for traditional financing.

This is not a theoretical scenario. I am the #4 ranked buyers agent in all of Las Vegas and my team and I have sold over 100 homes and completed over 25 of these lease option placements this year alone!

We have truly been able to create a win-win situation for everyone involved. Your client is able to immediately take advantage of historically low home prices by locking in a purchase price that is 50-60% below values of just a few years ago. By putting down a small deposit of between $3500 and $5000 at the beginning of the lease term (100% of which is credited towards the purchase of the home at the end of the lease period) and receiving a rent credit of between $100 and $300 per month, your client is able to quickly and easily save their down payment while living in their own home.

The best part is that you, as a Las Vegas mortgage professional referring a client into this program, are able to make money three times throughout the transaction. First, we will pay a referral fee of between $1000 and $2000 for every lease option tenant we place into a home. The exact referral amount is based on the amount of the lease option deposit fee we collect. Second, once we place a lease option tenant into a home, we immediately turn around and sell the home to a buy and hold investor as a turn-key investment property. You will be able to work with this investor to obtain financing on the property. (Usually this is via a 25% down investor loan.) Lastly, at the end of the lease term, you are able to put your client into a conventional loan in order to purchase the property.

Don’t turn clients and commissions away any longer! Start earning money on every potential lead. For more information on this wonderful opportunity, please contact Glenn Plantone at Wynn Realty:

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

Bank of America to Resume Foreclosures After Final Quarter Hiatus

2010-11-29T13:40:00.000-08:00

Bank of America, the nation’s largest mortgage service company since acquiring Countrywide in 2008, announced that they will resume foreclosing on homes Wednesday, December 1st. This comes after the banking giant self-imposed a foreclosure moratorium in the wake of the “robo-signing” scandal that received wide spread media attention in 2009. While this news is undoubtedly another blow to beleaguered homeowners, it comes none too soon for investors looking to purchase post foreclosure properties. In the final quarter of 2010, investors have found slim pickings at Trustees’ Sale auctions across the country.

Fannie Mae and Freddie Mac also made an announcement on November 24th that they will resume the auction sale of homes that have loans serviced by Bank of America, Chase, PNC Financial and others.

The last several years have seen several cessations and moratoriums on foreclosure proceedings that have caused the pool of available investment properties to dry up until the next wave of foreclosures begins. Many agents have struggled during these times to find suitable properties for their clients. My unique approach to securing homes for my investor clients has insured that we at Wynn Realty Group have actually thrived during these past several years of market flux.

We focus on purchasing properties wherever the best deals are available at the time. This includes Trustees’ Sale acquisitions, short sales, traditional listings and REOs. Once we purchase a property, we perform the necessary rehab and find a lease option tenant. We sell the properties to our investor clients as turn-key, hands off investment opportunities. The properties are already rented to a lease option tenant with CAP rates of between 10-14%. This provides investors with a low risk, low maintenance property with high appreciation potential and built in equity. We also offer partnership opportunities for investors looking to finance our rehabs for an even larger annualized rate of return.

As an example, we recently purchased a 4 bedroom home, 1800+ square feet, only three years old for $84,100 at the Trustees’ Sale. We resold the property only 17 days from the purchase date for $110,000. This particular home did not need any rehab and my investor partner made an amazing 288% annualized return on his money.

A second deal was a 1454 square foot town home with 2 car attached garage (also built in 2007) that we purchased for $70,100. After a quick clean up, we placed a long term renter in the property and resold it 40 days from acquisition date for $88,000. We partnered with an investor on this deal who saw a $6000 return on his money in a little over a month.

We can fully document all of the 24 flips that we have completed just this year alone! If you are interested in purchasing turn-key, high quality investment properties with renter in place; or if you like the idea of partnering on our rehab projects, please contact me to talk about real estate opportunities here in Las Vegas.

Wynn Realty Group and Glenn Plantone - Go With the Flow!

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

Glenn Plantone is the 4th Busiest Buyers’ Agent in All of Clark County, Nevada!

2010-11-08T14:30:00.000-08:00

Based on official escrow data for Clark County, Glenn Plantone is the 4th Busiest Buyers’ Agent in all of Clark County, Nevada for the third quarter of 2010. In the third quarter, Glenn closed on 17 properties for his buyers. (This doesn’t count the additional properties that Glenn listed and sold as a seller’s agent.)

Glenn Plantone specializes in identifying excellent investment opportunities for his investor clients in the greater Las Vegas area. Recent data has shown that over 50% of all current buyers in the Las Vegas market are investors, and this is the niche that Glenn has chosen to focus on. He currently represents buyers from China, Canada, and all across the United States and specializes in helping these out-of-town investors purchase turn-key real estate investments in Las Vegas with CAP rates upwards of 12%.

Glenn has recently moved to Wynn Realty Group in order to spearhead a new branch office completely devoted to understanding investors and catering to their needs. Glenn and his team buy and sell houses, condos, townhomes, and high rise condo units. They do short sale flips and purchase properties for investors at the Trustees’ Sale. They work with owner carried financing and negotiate short sale listings with an in-house negotiator. They also have a property management division dedicated to handling investors needs and making it easy for investors from all over the world to own cash-flowing property in Las Vegas.

Of course, Glenn is always welcoming new clients, so if you are looking to invest in this exceptional Las Vegas market, please contact Glenn for more information. However, Glenn is also currently seeking dedicated, motivated agents for his expanding office. Glenn currently has more leads than he can handle and he needs to bring a few good Las Vegas real estate agents onto the team to help close deals. If you are such an agent and would like to increase your income substantially, come speak to Glenn about working with the company that follows the flow of the Las Vegas real estate market.

Wynn Realty Group and Glenn Plantone - Go With the Flow!

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

MGM 3rd Quarter 2010

2010-10-28T12:50:00.000-07:00

The third quarter of 2010 has officially ended and it’s time to take stock of recent developments at the MGM Signature Hotel/Condo project. I have been following this particular property for over two years and have published a quarterly update throughout that time. This quarter is particularly noteworthy as it has brought the opportunity for fractional ownership in the MGM Signature towers for the first time in the history of the development. (More on that later in this article.)

Beginning with the sales data: In my second quarter, 2010 MGM update, published on my blog August 17th, 2010, I stated, “I am ready to go on record at this point and say that we have seen the bottom of this market as far as pricing on MGM Signature units is concerned...demand has accelerated so steadily for these units that I believe demand is now outpacing supply.” This prediction has certainly come true. In the third quarter, we watched sales of one bedroom units increase slightly from 24 units in the second quarter to 26 units in the third quarter...but the significant change came in the average price per unit sold. In the second quarter of 2010, the average one bedroom unit at the MGM Signature sold for $218,000. During the third quarter, this price went up substantially to $227,000. Another telling statistic is the decline in the number of one bedroom units selling under $200,000 (6 units in the third quarter, down from 9 in the second.) As this article goes to press, there are no listings for one bedrooms under $200,000.

Although the average price for a studio unit in the third quarter remained steady at $155,000, we saw yet another sharp increase in sales volume. 53 studio units (sometimes referred to as junior suites) closed in the third quarter, up from 41 units in the second quarter, which was already up substantially from 36 units in the first quarter of 2010.

There are currently zero bank-owned REO units of either type available for sale at the Signature towers. There are 5 short sales available for one bedrooms and 24 short sale studios listed. The remaining 11 one bedroom and 33 studio listings are regular re-sales.

As I stated at the end of the second quarter, demand is now exceeding supply at the MGM Signature. If you are at all interested in investing in this property, now is a great time to do it. I track all four possible methods of acquiring a unit (short sales, REOs, re-sale, and units purchased directly from the trustees’ sale) in order to get my investors the best possible entry price into the property. As a result, I currently have the lowest priced strip-side studio unit available in the entire property. It is priced at $144,000. (Contact me if you are interested.)

Another option we have just put in place is for those of my clients who have expressed an interest in owning a portion of an MGM unit that they can use for vacations, etc. We have just put together a fractional ownership plan that works perfectly for those who want to invest a lot less money and still control a four week block of time at the MGM Signature. We are currently offering fractional options on two different units. The fractional shares sell for $14,995 and include all maintenance fees and HOA dues for the first year. Each share is entitled to four, separate, full weeks of use of a strip-side unit with balcony. Investors who do not wish to use the unit for the entire share can place the unit in the rental pool and earn revenues on the room for any un-used nights.

If you are interested in purchasing a unit, or a fractional share of a unit, at the MGM Signature Hotel/Condo, please contact me for more details. I have specialized in this property for years and would love to help you acquire a piece of the Strip.

Glenn Plantone
(702) 769-9872
gsplantone@gmail.com

Come Visit Las Vegas to Buy Real Estate and Stay at the MGM Signature for Free!

2010-10-18T08:25:00.000-07:00

Those of you who have followed my articles over the last several years, know that I successfully “called” the bottom of the Las Vegas real estate market in May of 2009, months before the news sources announced the same thing. (See my blog entry of May 27th, 2009: http://vegasforeclosures.blogspot.com/2009/05/las-vegas-real-estate-market-bottom-is.html .) It has been a year and a half since then, and prices have remained steady. We are in a pricing plateau of sorts. As a result, it continues to be a great time to purchase investment or vacation properties below market prices and below builder replacement costs here in the Las Vegas valley.

A strategy that my team has been using quite successfully over the last year, involves purchasing short sale properties at below market value rates, performing light rehab on the properties and then placing lease option tenants in the homes. Using this strategy, we are currently generating 12-14% returns (CAP rates) for our investor clients on single family homes in the Northwest. The investors purchase turn key properties, fully rehabbed, with lease option tenants already in place and begin earning 12-14% on their money right away. And the best part is that these are phenomenal returns will only improve over time as rents increase and home prices appreciate.

If you have been waiting for the right time to jump back into the real estate investment market in Las Vegas...now is the time! If you live outside the Las Vegas valley and are interested in purchasing an investment or vacation property, we would like to extend to you a very special offer. We have recently purchased three beautiful units at the MGM Signature Hotel Condos and are inviting all of our clients to come stay with us for two complimentary days at the MGM while you explore potential investment real estate in Las Vegas. Please call Glenn for more details on coming for a visit.

REOs Depleted at MGM Signature Condos - Glenn Plantone Once Again Offers Lowest Priced Strip Studio at $144K

2010-10-13T18:02:00.000-07:00

I have been following the MGM Signature Hotel Condos for the past three years and have watched as many of the units that originally sold during the height of the real estate boom for hundreds of thousands of dollars moved back to the bank as foreclosures. These units later re-entered the market as bargain-priced REOs. However, as the real estate market has continued to rebound in Las Vegas, interest in the MGM Signature property has risen steadily. This increase in demand has caused prices to begin to creep up and the number of available REO properties to shrink. In my article of April 27th, 2010 entitled “Short Sales Continue to Rise at MGM Signature Towers,” I predicted that, by the end of 2010, we would see a complete shift away from REO foreclosures at the MGM Signature. I predicted that the number of available REO units would continue to drop throughout the year and be replaced by short sales and other forms of private party selling. I also anticipated that the occupancy rates for the rental pool at the MGM Signature would rise this year as compared to 2008 and 2009.

These predictions have come true. As of this writing, the number of available REO units within the MGM Signature complex has dropped to ZERO. Also, year-to-date, the management company for the Towers has been able to average an 86% occupancy rate for the property with an average room rate of $121 per night for strip side studio units.

Because I specialize in the MGM Signature Towers, I have been able to list and sell several of these units to investors who are using them as vacation properties and/or cash flowing them in the rental pool. I currently have a 10th floor unit available with a beautiful strip view. It is in the third building with the pool just below. (125 East Harmon Ave.) At $144,000, this unit is the lowest priced strip side studio available in the entire complex. If you are interested, this purchase must be a cash offer and you need to act quickly. This unit will not remain available for long.

Glenn Plantone
702-769-9872
gsplantone@gmail.com

For Investors Seeking a Secure 24% Return

2010-09-30T14:47:00.000-07:00

Many of you, who have followed my articles and blog posts over the last several years, know that I advocate having the qualities of a chameleon if you are going to succeed in real estate investing. What I mean by this is; that you need to be able to constantly change and adapt to new buying and selling environments, in order to take advantage of the particular set of circumstances in which you find yourself. Every market presents opportunities. Great opportunities. Lucrative opportunities. We, as real estate investors, must simply know how to adapt ourselves and our skill sets in order to take advantage of these opportunities.

For the last several months, I have been purchasing short sales, trustee sales, and REO properties here in Las Vegas and successfully reselling them quickly and profitably to investors.

Here’s my formula:

1. I buy the homes for approximately $10,000 - $25,000 under real, current market value. I am able to do this because I pay cash for the homes and am willing to write hundreds of offers in order to acquire those few “gem” properties.
2. I specialize in the northwest part of Las Vegas and I only purchase homes that were built in 2004 or later. This strategy enables me to be intimately familiar with each neighborhood and be confident in my acquisitions.
3. We have two construction crews who are constantly working and are able to quickly rehab the homes for an average of $1,000 to $5,000.
4. We maintain an active list of lease option tenants who are looking for nice properties in the northwest area. Once we finish rehabbing a property, we are able to rent the homes very quickly to these lease option tenants.
5. Lease option tenants pay higher than market rents, put down large non-refundable lease option deposits, handle their own maintenance issues, and do not require property managment fees. As a result, they are the perfect tenants for investors.
6. Once this process is complete and the lease option tenants are in place, we quickly sell the property to one of my cash investors who are looking for a great return on a turn key, hands off investment. Our investors love the fact that we are currently providing them with properties that average a 12-14% capitalization rate (cap rate.)

I have perfected all the pieces of this process to the point that we are generally in and out of each property in less than 30 days. We are currently averaging a 25 day turn around over the course of our first 20 deals this year.

If you are interested in becoming a funder for one of these flips, your money will generally be tied up for approximately 30 days and will have a guaranteed return of 24% annualized. You will always be in first position with a deed of trust against the property.

I am currently seeking funders with a minimum of $50,000 to invest who are looking for a safe, secured, guaranteed return of at least 24% annualized.

If you are interested, please contact me for more information:
Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

Glenn Plantone to Join Wynn Realty Group

2010-09-17T14:50:00.001-07:00

We are proud to announce that Glenn Plantone, noted Las Vegas real estate expert and full-time investor and real estate professional has joined the growing team at Wynn Realty Group.

Glenn is a leader in locating and capitalizing on profitable real estate investment opportunities in the Las Vegas area and beyond. He is also the foremost, recognized expert on the MGM Signature Hotel and Condos high rise Strip development. Glenn has been quoted repeatedly by such notable news sources as CNN Money, the Las Vegas Sun Business Journal, the Las Vegas Review Journal, realtor.com and many others. He is also the founder of the Real Estate Insider Club and has welcomed many high-demand keynote speakers to the club including Las Vegas Mayor Oscar Goodman and Than Merrill of A&E’s hit TV show “Flip This House.”

Wynn Realty Group is founded upon hard work and integrity driven service to its clients. Opening an office in October at the “Village at Centennial Springs”, Wynn Realty is poised to continue to make its mark on the Las Vegas real estate market. In addition to welcoming Glenn to the team, Wynn Realty Group is seeking a limited number of real estate professionals who understand that the only way to work is with a 100% commission brokerage. You know who you are. If you are interested in finding out more about this opportunity, please contact Wynn Realty at 702-953-4999 for a private conversation about your future.

If you would like to follow Glenn and his insights on the Las Vegas real estate market, visit his blog at www.vegasforeclosures.blogspot.com

MGM Signature Towers is Offering Fractional Ownership Opportunities For the First Time!

2010-09-09T12:31:00.000-07:00

MGM Signature Towers is Offering Fractional Ownership Opportunities For the First Time!

Many of my regular readers know that I have been covering the MGM Signature Towers property for a few years now. I have watched as the project was built and the new units sold for between $480K and over $1 million. I covered the decline of unit values as the bubble burst and prices plummeted to 30% of their original highs. Now, I am excited to offer a first-ever opportunity for the MGM Signature...fractional ownership.

Many of my clients have expressed to me their desire to enjoy the privileges of MGM Signature ownership but have not wanted to pay the $150,000 + price tag (in cash) necessary to acquire a strip-side, balcony unit at today’s new, low prices. In response to this demand, Greg Darroch and I have developed a fractional ownership plan that allows participants to control 30 days (one full month) of ownership in an MGM Signature, strip-side, balcony unit for only $17,995. During the 30 days of owner time, owners can stay at the property themselves, have friends and family come to visit, use the property to entertain business associates, or keep the unit in the rental program and earn nightly income.

We currently have available two side-by-side, connecting studio (junior suite) units, each with a strip side view and a balcony. There are a total of 24 fractional ownership shares available, as we will have 12 ownership shares per unit. Those who are interested can also purchase one share of each unit. Those who choose to do this, will be allowed to secure the same time blocks on both units so that they can use them together when they visit. Each studio unit sleeps 4 people, so having two connecting units provides a sleeping capacity of 8.

We are currently taking reservations for shares of these units. If you are interested, please contact Glenn Plantone for more information.

Glenn Plantone
Wynn Realty Group
Office: (702) 656-3264
Mobile: (702) 769-9872
Email: gsplantone@gmail.com

www.viewpointequity.com

MGM Signature Towers Second Quarter Update

2010-08-17T15:02:00.000-07:00

I have fielded several requests recently from those who follow my regular blog and email updates on the MGM Signature Towers, for sales information from the second quarter of 2010. Those numbers have arrived and I’d like to share them with you.

Sales volume showed a marked increase in the second quarter of 2010 (April 1st - June 30th, 2010.) 41 studios sold in the second quarter, as opposed to 36 in the first quarter of this year. But, more impressively, one-bedroom sales doubled quarter over quarter with 24 one-bedrooms closing in the second quarter of 2010 as opposed to 12 in the first.

While median sales prices for both studios and one-bedrooms crept down marginally in the second quarter, I noticed that demand began to increase dramatically for these properties and, towards the end of the quarter, I was having to fight against a lot of competition to secure bargain priced units for my clients.

The average price for the 41 studio units that sold this quarter was $155,000. This is slightly lower than first quarter’s average price of $160,000. The high selling price for all studios was a strip side penthouse unit with a balcony (125-3015) that closed for $210,000. The lowest priced studio this quarter was a low floor strip side unit with no balcony that sold for $100,000 (145-403). The highest priced sale of units that have no balcony was unit 135-3403 that sold for $189,888 and the highest mountain side unit to sell was unit 145-1406 that sold for $160,000.

For those of you looking to invest or purchase at the MGM Signature, it is important to note that Strip side units usually sell for a $20K - $30K premium over mountain side units, and units with a balcony typically sell for higher prices than those without a balcony by about the same margin. Conversely, studio units with a balcony do experience a higher occupancy rate in the rental pool than those without.

For the 24 one-bedroom units that sold in the second quarter of 2010, the average price was $218,000, this is down $11,000 from the first quarter average of $229,000. The top selling one-bedroom unit was a strip side, penthouse unit (135-3401...if you are interested, I have a similar penthouse unit available right now) and the lowest seller was a low floor, mountain side, interior unit with a terrible view (145-208.) All one-bedroom units have balconies.

As I look at the current inventory of MGM Signature properties, there are 17 one-bedrooms listed. Of these, there are zero REO (foreclosure) listings, 4 short sales, and 13 regular listings. There are 58 studios listed for sale: 1 REO, 23 short sales and 34 regular listings.

I am ready to go on record at this point and say that we have seen the bottom of this market as far as pricing on MGM Signature units is concerned. I do believe that there will be a lot more foreclosures in these buildings, but the demand has accelerated so steadily for these units that I believe demand is now outpacing supply. In the final month of this quarter, we began to see prices creeping upward a bit. I am also noticing as I negotiate for my clients in the “front lines” of these transactions, that it is getting harder and harder for me to secure good units at great prices for my investors because the competition is becoming quite fierce.

As always, I will continue to keep a close watch on sales trends here at the MGM Signature Towers in Las Vegas. Please follow my blog or subscribe to my regular newsletters if you would like to continue to learn more about this project. If you have any questions about the MGM Signature Towers, or are interested in looking at units for investment or personal use, please don’t hesitate to contact me. I have lots of good information on occupancy numbers, proformas, rental info and the like and will be happy to help you.

Glenn Plantone
702-769-9872
gsplantone@gmail.com

CNN Money Labels Glenn Plantone One of the New Vulture Investors? Oh Well, I’ve Been Called Worse

2010-08-10T16:47:00.000-07:00

They say any publicity is good publicity, and I couldn’t agree more. So when CNNMoney.com featured me in an article titled “Vulture Investors: They're Back - And Making a Bundle” I was...well... pleased. If by vulture, they are implying that I am swooping in to find life and profit in properties that are regarded by many as dead and worthless, then I can live with that analogy. And they certainly are right about investors in this market being able to make a bundle. I believe we are currently living in the best real estate buying climate since the Great Depression...perhaps better.

So, it is with great pride, that I re-post excerpts from the CNNMoney.com article:

NEW YORK (CNNMoney.com) -- These are the glory days of the residential real estate investor. Low prices, rock-bottom interest rates and stable rental markets have created huge buying opportunities.

Although conditions are very favorable, investors have to be adaptable because the market is evolving rapidly... Foreclosure auctions are no longer a fertile hunting ground... Tanya Marchiol of Team Investments, which has operations in about 10 states but focuses mostly on the Phoenix market, says, “"Amateurs have come in and run up the prices. In 2009 I bought 76 properties at foreclosure auctions, at an average of about 60 cents on the market dollar. This year, I've bought four."

Glenn Plantone faces a similar situation in Las Vegas. A veteran real estate broker and investor, he has switched from buying mostly foreclosures and repossessions to short sales almost exclusively. That's because the inventory of distressed properties available in Vegas is way down, to about a two-week supply.

"The banks make better profits with short sales, so they're not foreclosing," Plantone said. "They've switched staff to processing short sales and they've gotten faster at processing them."
He tries to purchase properties for at least 10% less than what he considers to be true market value, then he does some light rehabilitation and sells them to some of the 3,000 buyers he works with.

Since prices have fallen about 70% in some Vegas communities and rents have only declined by about 20%, it's possible for his investors, who are cash buyers, to make money from the first month the homes are rented.

"We're getting cash flow (net return on investment) of 12% to 14%," he said.
He doesn't completely ignore potential profits from home price appreciation because he believes the town is bouncing around the bottom. (Homes already sell for below what it would cost to build new homes.) He does not, however, emphasize that aspect of the investment.
It's the income from rentals that's paramount right now.

The beauty of cash flow, of course, is that even if the prices decline another 10% or 20%, the investors should be able to live with that.

"I tell them to plan on holding for five years," he said. "With cash flow, there's no need to worry about price drops."

To receive more information please contact me.

Glenn Plantone
gsplantone@gmail.com
(702) 769-9872

What is Transactional Funding and Why Do We Need It In Order to Flip Properties in Las Vegas?

2010-07-27T19:16:00.000-07:00

I have written several articles lately announcing the return of profitable flipping conditions in Las Vegas, NV. Las Vegas has led the nation in foreclosures since the real estate bubble burst approximately three years ago, and we have seen our home prices plummet to $0.30 on the dollar or less. Simultaneously, this wave of foreclosures has created a large demand for rental properties as former home owners become home renters. This has resulted in rents that have remained relatively stable as the prices of homes have steadily dropped. This unique set of circumstances has generated positive cash flow scenarios for investor buyers that haven’t existed in Las Vegas in decades. It has also created a niche for those looking to flip properties once again.

Most of the foreclosures that are being sold at auction, through bank owned REO listings, and short sales need only minor, cosmetic repairs to bring them up to rental standards. Investors willing to purchase these properties, can put $5K-$10K into them and then turn around and sell them to investors for a reasonable profit. These investors are still able to purchase the property at a price that makes it possible for the property to generate strong positive cash flow at prevailing market rents.

The catch in this process is that, in order to acquire a property at the Trustees’ Auction or through short sales, the prospective buyer has to come with cash. Many flippers (such as myself) have the resources and ability to flip multiple properties simultaneously, but lack the personal cash reserves to tie up more than one or two properties at a time. This is where transactional funders enter the picture. My transactional funders loan money to me on a very short term basis in order to purchase properties at the auction, through the banks, or with short sales that have been approved and are under market value. These funds are always protected by a first position lien on the property. Once the properties have been successfully rehabbed and held for the minimum time period specified by the bank (usually 30 days), they are resold to my investor clients and my transactional funders are repaid in full. The transactional funders usually see their money tied up for no more than 35 days and they are paid 3% on their investment. This equates to 36%-156% annualized returns on the average transaction. Some sell in as little as a week others in a little over a month. Returns can be adjusted if properties take longer than 35 days to close to ensure that the funder is making a minimum 24% return on his money (annualized and guaranteed).

If you are interested in providing transactional funding for upcoming projects, or to receive more information on the over one dozen flips that I have successfully completed within the last few months, please contact me:

Glenn Plantone
gsplantone@gmail.com
(702) 769-9872

Flipping Short Sales In Las Vegas Provides a Win-Win-Win Situation in 2010

2010-07-19T16:35:00.000-07:00

I have come across a very exciting niche in the Las Vegas Real estate market that is creating a win-win-win scenario for me, my short term funding investors, and the “end-user” investor buying our properties. Over the last several months, we have completed 10 deals and have had terrific (and fully documented) results on all of them.

So what am I doing?

First a little background: Over the last several years, Las Vegas has received a lot of press as the “Foreclosure Capital of the Nation.” This is true…foreclosures in the Las Vegas valley in 2008 and 2009 reached record-breaking highs, and led the nation. However, what most people don’t realize is that the inventory of bank owned REO properties in Las Vegas has PLUMMETED over the last six months. Last year, 75% of all home sales in Las Vegas were foreclosures. Now, the current bank owned inventory of available homes (not pending or contingent) represents only about 10% of the total homes for sale through the MLS in Las Vegas. Additionally, over the last year, the number of homes sold in Las Vegas has drastically outweighed the number of homes returning to the banks via foreclosures. This shortage of inventory of “bargain” priced REOs has created a huge demand for the REOs that do enter the market. Many investors, including all-cash buyers, are finding themselves shut out or locked in bidding wars when trying to purchase an investment property.

The solution: I have found a solution to this predicament that provides my investor clients with a turn-key, extremely profitable property and generates a large, safe return for my transactional funding investors as well.

Here’s how it works: I continually search for and tie up short sales that have substantial equity. This process takes anywhere from two to eight months to secure bank approval. Once the short sale is approved, I use short-term transactional funding to purchase the property from the bank. My funding investors are guaranteed either a 24% annualized return on their money (if they invest for a single deal…in and out in less than 30 days typically) or 18% annualized return for long term investors who want to park their money to be used for multiple deals over a several month or year period.

After the property has been purchased, I bring in a team to quickly rehab the home and get it into turn-key condition. We then place one of our pre-screened lease-option tenants in the property. This lease-option tenant buyer puts down a nice size, non-refundable deposit on the home and then pays higher than market rent. This saves our investor property management as well as maintenance fees and provides a built-in buyer for the property down the road.

Here is an example from one of the properties that we recently flipped: It took me ten months to negotiate this particular short sale with the bank. Ultimately the home was purchased by my transactional funder and I for $109,000 (it sold new for $254,000 three years ago.) It is a 2100 square foot, four bedroom home in a newer area of Las Vegas. We were able to put a lease option tenant in place immediately who pays $1495 rent per month and put $4500 down (non refundable lease option payment.) As soon as we closed on the purchase of the home at the $109K price, we re-sold it to an investor buyer looking for a great hands off investment with a great return. The sales price to the investor was $129,000. The "cap rate" return of cash flow for the new owner is 13%. If he sells it to the lease option tenant after the 2 year option period, he will net a 27% return on his investment.

As for my transactional funder, because we had the home sold and closed within 7 days, the funder earned $2400 on his investment (he put in $80,000 and I put in the rest of the $109,000 purchase price). This $2400 in one week equated to a 156% annualized return on his money. As soon as we got out of this deal he was able to move immediately into another very similar transaction that ended up cashing out with nearly identical numbers.

In all cases, the transactional funding money is fully protected by a deed on the property that is being purchased.

If you are interested in getting these kinds of safe, guaranteed returns for transactional funding or are interested purchasing these kind of turn-key investment properties (with cap rates of 10%+ in many cases), or if you know an investor looking for these kinds of returns, please contact me for more information. I do pay referrals for those bringing investors.

Glenn Plantone
gsplantone@gmail.com
Office: 702.656.3264
Cell: 702.769.9872

Transactional Funding Proves Profitable for Investors

2010-07-07T17:34:00.000-07:00

The recent credit crunch and rapid decline in home prices in Las Vegas has created an environment that is once again ripe for successfully flipping properties. I have been acquiring properties at the Trustee Sale in Las Vegas, performing very light rehab, and then immediately flipping them for a modest profit. In many cases, the people buying the houses are investors looking for a turn key property that they can begin renting right away for strong positive cash flow.

I have now completed this process with almost a dozen properties and it has been a win-win-win situation for all parties involved...the third party being the transactional funder. My transactional investors are receiving returns of over 100% annualized on their money!

Here is a recent example:

We purchased a townhome at 9122 Dancing Snow for $62,500. After closing costs, repairs, and costs to sell, we were into the property for $68,651. I was able to sell the property to a happy investor for $74,995. This resulted in a profit from the flip of $6,344. The funder, who had invested $65,000, was repaid in full plus their funding costs of $1,900 in 10 days! This resulted in an annualized return of 108% on the investor’s money!

If you would like to review all the details of this transaction
CLICK HERE.

Here is another example:

We acquired a 3 bedroom/2 bath townhome at 6868 Skypointe for $66,500. The property sold in 7 days for $79,995. This resulted in a profit on the ip of $9,156. The investor put $68,000 into the property and was paid $1,360 for their funding. This represented an annualized return of 104%.

In case you are wondering what kind of investment this made for the investor who purchased the property...once purchased for $79,995, the unit was rented for $975!

If you would like to review all the details of this transaction
CLICK HERE.

If you are interested in transactional funding, please contact Glenn for
more information.

(702) 769-9872
gsplantone@gmail.com

Earn a 30% Return on a $1,000,000 Real Estate Backed Investment

2010-06-28T13:37:00.000-07:00

As baby boomers mature and reach retirement age, building has accelerated in mild climates worldwide to meet the coming demand for retirement housing. Costa Rica was one such locale that has experienced tremendous growth in the last several years as it has exceptional year round weather and is one of the safest countries in the world. Recently, however, the global economic downturn, coupled with the difficulty of obtaining building permits in Costa Rica, have combined to dramatically slow this growth.

There is an American developer, however, who has been extremely successful in obtaining the required building permits from the Costa Rican government. This builder's relationships with the local and national governments, his understanding of local culture, and sheer persistence have enabled him to succeed where many others have failed. He has had several projects built over the last several years in the Central Pacific Coast region of Costa Rica and he now has three current projects that are fully permitted and ready to build.

The projects have been approved to receive a $35M Hedge Fund loan to complete building. However, a $1M bridge loan is required in order to secure the larger loan. Once the bridge loan is secured, the process to fund the larger, $35M loan should take 60-90 days. Once the larger loan is funded, the builder will take the first draw of $5M and with that will pay the entire principal balance of $1M to the bridge investor. With each subsequent monthly building draw, the bridge investor will be paid interest on their original investment. The total interest amount of $300,000 will be paid in even installments over the remaining draws of the $35M loan.

The $1M bridge loan will be secured by the property and will be immediately placed in escrow until it is needed to fund the larger loan.

If you are interested in participating in this project, please contact Glenn Plantone for more details.

gsplantone@gmail.com 702.938.8888 office or cell 702.769.9872

FHA Reform Bill is a Dose of "Tough Love" for Potential Home Buyers

2010-06-14T11:48:00.000-07:00

Earlier this month, the U.S. House of Representatives overwhelmingly passed a bill aimed at shoring up the shaky financial position of the Federal Housing Administration (FHA). While the FHA does not actually lend money, it insures the loans of millions of borrowers who, without this insurance, would not be able to qualify for a conventional lending product. FHA guidelines traditionally allow borrowers to qualify for loans with a much smaller down payment than those without FHA insurance. (3% down with FHA insured loans as opposed to 10-20% for borrowers who do not use the FHA program.)

As the credit crisis continues to slow the recovery of the housing markets nationwide, the role of the FHA has been radically expanded, with lenders less and less willing to risk writing loans that are not insured by the Federal Housing Administration. Less than four years ago, the FHA insured only 4% of America's home loans; now, that number has risen to roughly one third of all new home loans that are written.

As their involvement and importance has grown, however, the financial position of the FHA has worsened. By law, the FHA is required to hold 2% of the total volume of loans insured in the FHA's Mutual Mortgage Insurance Fund. As of September 30th, 2009 the FHA reported that its reserves had fallen to just $3.6 billion, representing a scant 0.53 percent of the $685 billion worth of FHA-insured loans at that time, and roughly a quarter of the reserves they are required to have on hand.

In order to improve the FHA's financial position, this reform bill, introduced by Rep. Maxine Waters(D-Calif.) raises fees for borrowers, gives the FHA the power to oust lenders that are costing the agency too much money in claims, and makes it easier for the FHA to protect itself from fraud-related losses. The fee hike is considerable in that it allows the FHA to raise the rate it charges borrowers from 0.55 percent of the amount of the mortgage to 1.5%...nearly triple. These premiums are paid by borrowers over the life of their loans, and the FHA says the premium increase will cost the average borrower around $42 per month.

Although a companion bill has not yet been introduced in the Senate, it is expected that legislation will be taken up after the July 4th recess and will most likely pass easily.

If you would like more information on purchasing investment properties in Las Vegas, please contact Glenn Plantone: (702) 769-9872 or gsplantone@gmail.com

Review of My Stay at the MGM Signature Towers Hotel-Condo

2010-06-04T12:44:00.000-07:00

Over the last year I have sold several units at the MGM Signature Condo Hotel, and I decided it was time to experience the property myself from a guest’s point of view. As a result, this past Memorial Day Weekend, my family and I made the long journey to the Strip area from our home in North Las Vegas (about 20 minutes away.) With my wife, and two younger sons (ages 9 and 7), I checked into the MGM Signature on Saturday afternoon to a full house.

From the time we entered the property through the guard-gated entrance off of Harmon Avenue, pulled up to valet parking, and made our way to the individualized owner check-in inside of building 2, the feeling was that we were entering a high-end hotel. The service from the check-in personnel and the bellman bringing up our bags was excellent as expected. Our room was in the middle of the three buildings on the 6th floor - strip side with a balcony. Only about 1/3 of all studio units have a balcony. Units with balconies have higher occupancy rates in the rental pool than non-balcony units. As a result, balcony strip side studios will actually cash flow for investors that are purchasing them at today's new, low prices. The view was outstanding. We felt like we were right on top of the pool with a terrific strip view of the City Center just ahead. Later in the evening, as the sun sank behind the mountains, the lights from the strip and the pool area below were fantastic.

The boys slept comfortably on the pullout couch and my wife and I enjoyed the comfort of the main bed. Any noises from down below were drowned out by the a/c and double paned windows. With a mini-fridge, microwave, cook top, and full kitchenette we were able to bring our own food and drink, enabling us to be very comfortable in our home away from home. The boys really got a kick out of the television and phone in the bathroom, and I appreciated the DVD player that allowed us to watch our own movies instead of paying for an "all too expensive" in-house movie rental.

Many weekends a year, the MGM Signature Hotel sells out and Memorial Day, 2010 was no exception. Typical room rates are $149 for a studio unit and $199 for the larger one bedroom units. After having sold for an average price of $495K (studio) and $795K (one bedroom) just 3 years ago, prices have now come down to a very reasonable $100-200K for studios and $160-$250K for one bedroom units. The MGM Hotel Management Group is one of the many options that investors can use to manage their unit while they live their lives. As an owner, investors can come and stay in the unit as often as they like for a very minimal cost (room cleaning) and keep it in the rental program the rest of the time. (The MGM Management Group will charge 40% of the room revenue to manage the room.) Since the units that are being sold at the moment are usually foreclosures and therefore all-cash purchases, I am seeing a lot of groups of friends and investors pooling their money together in order to purchase a unit. This way, they can all use the property whenever they vacation in Las Vegas and can still share in the positive cash flow and future appreciation of the unit.

As an early riser, it was fun to watch the partiers straggle in at 4-6 am as I leaned over my balcony. We hit the gym at 7am both mornings, and shared one of the two massive onsite fitness centers with only about 10 other people. The fitness center boasted state-of-the-art equipment, including televisions that made my workout fly by. There is also a Starbucks, deli, gift store, computer center, concierge, lounge, and mail room all on site. In fact, I am told by the owners office that about 15% of the hotel condo is occupied by full time residents. All three of the towers are connected and it is only a short walk to the MGM Hotel via a long air conditioned corridor.

Each of the three buildings has its own pool or guests can enjoy the use of the main MGM pool that sits right behind the first building. The towers were built from 2005 to 2007 and have a terrific location just one block off the Strip. It is away from the hustle and bustle, but still only a 10-15 minute walk to the center of the Strip. On Sunday, we walked up Harmon to the Miracle Mile Mall for the Sushi Buffet at Todai. Afterwards, we walked the Mall, enjoyed a family massage at one of the stores, then headed up the strip to the Bellagio to catch one of the wonderful water, music, and light shows that run every 15 minutes.

On Sunday afternoon, we laid out by the pool for about four hours with the kids. I was able to catch some rays, catch up on some reading and spend some quality time in the pool with the boys. Pools two and three are connected and pool two (the one down below our room) is heated and open year-round along with the hot tub.

We checked out on Monday around 12 noon and made our way back up the 15 freeway to our home in the north. It was very nice to experience the Signature from the perspective of a guest and, as an owner, it only cost me the $35 cleaning fee for our two day stay. We are sold. It sure beats a time share.

I have the distinction of having sold the least expensive unit in the complex (a Strip side studio at only $99,900). I have been buying and selling at the Signature for over a year now. I write frequent articles and blogs about the MGM Signature and Las Vegas real estate in general. If you would like to learn more about the MGM Signature Condo Hotel or are interested in Las Vegas investment real estate with strong positive cash flow, please feel free to contact me to learn more.

Glenn Plantone
(702)769-9872 or gsplantone@gmail.com

Banks Manipulate Las Vegas Housing Floor

2010-05-20T20:50:00.000-07:00

For the last two years, banks have been trying to force real estate markets nationwide to reach a "bottom." The wave of foreclosures that began in 2008 drove inventory through the roof in many metro areas, like Las Vegas. The credit crunch made it nearly impossible for the average buyer to qualify for a loan, and real estate sales everywhere slowed to a virtual standstill. This excess of supply and lack of demand caused real estate prices to take their largest tumble since the Great Depression. Dozens of large banks and mortgage companies closed their doors and those that survived tried desperately to cut their losses. After two years, they seem to have managed to do just that.

Many analysts (myself included) view this latest manipulation of the free market economy by the banks as just the latest abuse of power in a line of misguided liberties that brought us to this financial crisis to begin with. But regardless of whether you condone or condemn the lending institutions for their actions, you can't argue that it seems to be accomplishing exactly what they hoped for...stabilizing real estate prices by manipulating inventory.

Here's how it works: In 2009, record numbers of homeowners defaulted on their mortgages, resulting in a wave of foreclosures that flooded the Las Vegas real estate market with inventory. In June of 2009, there were 2283 available (not pending or contingent) bank owned single family homes on the Las Vegas MLS. This number represented 23% of the 10,278 total SFH listings. As foreclosures continued to process, prices continued to fall. In Las Vegas the median home price fell an average of $10,000 per month, every month, for over two years. The banks felt that they had to do something to stop the bleeding and stabilize the market. So they stopped foreclosing on homes. With encouragement and incentives from the Obama administration, banks began shifting employees from their REO departments to their short sale departments. The previously elusive short sale became more and more common through the end of 2009 and into the beginning of 2010 as banks tried to keep homeowners in their properties and avoid injecting more inventory into the Las Vegas real estate market.

Their strategy worked. From June 2009, the percentage of available listings that were post-foreclosure REO properties began to fall. In January, 2010, there were just over 1000 single family REOs on the Las Vegas MLS. In February there were 1050 REOs out of a total 8001 available single family homes...a drop in market share from 23% to 13%. These 1000 homes represented only around 10 days worth of supply.

As the available inventory of bargain priced REO properties continued to shrink, demand for these properties began to outpace supply. Rick Shelton, Greater Las Vegas Association of Realtors (GLVAR) President noted recently that the average median price of a home in Las Vegas rose in April of 2010 to $142,000. Home prices were up 4.4% over March, 2010 and up .2% year over year from April of 2009. This is the first median price increase we have seen in Las Vegas since February of 2007.

So does this single the beginning of an upswing? To answer simply...absolutely not.

From December, 2009 through February, 2010 banks foreclosed on only about 900 homes per month in the Las Vegas valley. In March of this year, we started to see a dramatic change. The banks foreclosed on just over 1500 homes in March and then really turned up the heat by foreclosing on over 2300 homes in April. This huge increase in foreclosures is starting to create an increase in the number of available bank owned properties on the MLS. As of the writing of this article, we now have 1266 available SFH REOs. This represents 16% of all the available (7996) listings. Because banks are beginning, once again, to push foreclosure, there will naturally be more inventory moving into the Las Vegas real estate market. The banks have achieved their goal of shrinking inventory, and now the goal is to match the number of sales with the number of homes being foreclosed upon. I believe the banks will keep the number of foreclosures per month around the 3000 mark, as the numbers of sales have averaged around 3000 per month rather consistently. The goal is to keep inventory low and consistent. Any raise in inventory would cause prices to go down again, creating more dramatic losses for the banks. I don't believe they will allow this to happen.

The result of all this market manipulation is a matter of ongoing debate. Many experts believe that had the banks and the government simply allowed the market to naturally run its course, that the decline may have been steeper, but that the recovery would be quicker. Regardless of your opinion, one thing seems clear. With continuing low inventory, prices below historic trend levels, prices below builders' replacement costs, and investment properties that cash flow...this is a great time to buy real estate in Las Vegas.

If you are interested in learning more about investing in the Las Vegas real estate market, please contact me: Glenn Plantone, 702-769-9872, gsplantone@gmail.com.

AOL Provides Great Resource for Las Vegas Foreclosures, Short Sales and Real Estate Trends

2010-05-10T12:59:00.000-07:00

As many of you know, I use a lot of different tools to help me stay up to date on the latest trends and reports regarding Las Vegas foreclosures, short sales and general real estate trends. One of my favorites has always been the Google Alerts system. By simply going to your Google account page and entering your desired search terms, you will be automatically sent once a day, a list of the top five articles and blog posts relating directly to your search criteria. I, for example, have a Google Alert set up for "Las Vegas foreclosures." This alert constantly sends me the latest information on Las Vegas foreclosure trends, and helps me to better understand the Las Vegas real estate market, thereby being able to offer the best possible, most informed advice to my investor clients.

Another useful tool that I/we use is the AOL local real estate pages. These pages do a great job of consolidating lots of timely key information on local real estate markets, in one easy to access format. For example, if you go to http://realestate.aol.com/Las_Vegas-NV-real-estate you will find a wide variety of statistics such as: total inventory of Las Vegas homes for sale broken down by new builds, existing homes and foreclosures; percentage of Las Vegas properties that are owned, rented or vacant; median values of homes in Las Vegas and average monthly rent. You can also find graphs that compare average estimated value of Las Vegas homes to values from one month ago, one year ago, or any user defined time table. You can do the same thing for average sales price, total number of sales, household size and several other factors.

Whether you are an investor looking to research a potential purchase in the Las Vegas valley or a Realtor trying to develop your own niche, this is a valuable website for increasing your knowledge and expertise on the Las Vegas housing market. For more information on investing in Las Vegas, please visit my blog: www.vegasforeclosures.blogspot.com

Glenn Plantone
(702) 769-9872
gsplantone@gmail.com

Regent Short Sales

2010-05-03T12:43:00.000-07:00

I'd like to take a few minutes in this article, and discuss what is happening in the Las Vegas real estate market in general and with units at the Regent in North Las Vegas specifically. I’d also like to briefly discuss some of the options that are available to any current owners or investors in the Regent Las Vegas.

We all know that the last few years have been very difficult for all of us who own real estate in Las Vegas. The market has fallen as much at 80% in some areas of the Las Vegas valley. Here at the Regent, prices have dropped to around 27 cents on the dollar from original pricing and as low as 19 cents on the dollar from the highs of 2007.

I have been involved with the Regent since 2003 and have seen both the highs and the lows. My wife and I own three units here, I was on the board from 2007-2010, and served as its president for most of 2009. I have been on site since 2007 and currently work in the Re/max office in the front of the complex. As a licensed real estate agent and an investor myself, my clients are primarily other real estate investors. Last year I sold over 30 of the 67 units that closed here at the Regent…so nearly half of all the sales in the entire development. I am well versed in understanding the complex as a whole.

Over the last year we have seen rental rates drop about $200 per unit. This is having an effect on the quality of the tenants, the vacancy rates, and, of course, the bottom line cash flow on Regent investment units.

The news is not all bad as this northwest area of Las Vegas is continuing to develop nicely. A new Lowes home improvement store and Walgreens are due to open within a couple of months, a new bus station opened at the end of March and the Community College of Southern Nevada has announced they will be building a campus about 1/4 mile north of the Regent.

In 2009, foreclosure properties dominated the Las Vegas real estate market, and the Regent was no exception. 75% of all sales in Las Vegas in 2009 were foreclosures, and the percentage was even higher here in our complex. 67 units changed hands at the Regent in 2009, and almost all of them were foreclosures. With 274 total residential units in the complex, this means that 1 in 4 property owners lost their unit to foreclosure last year alone. Of the 22 one bedroom units sold through foreclosure, the lowest price was $29,900. There were 36 two bedroom units sold, and the lowest was at $44,000 (2 of them). Of the 9 three bedroom units sold last year the lowest priced unit was $55,000.

I believe that foreclosures will slow down this year, but only because of a dramatic increase in short sales. This is a trend that is occurring throughout the Las Vegas valley. Because of the government’s push to get short sales approved and accepted, they have picked up dramatically in the Las Vegas market. Last year short sales amounted to 8% of all sales while REOs accounted for about 75%. Already this year, short sales have risen to 25% of all sales while REOs have dropped to 50%. At this rate, I project that we will see a total switch of REOs and short sales by the end of the year.

As of this writing, there are only two bank owned REO foreclosures listed for sale in the entire project, but there are a total of 21 units listed for short sale. Of these 21 units, only two are actually available… the other 19 are already under contract in a pending or contingent status.

There is a huge advantage to having your unit go through a short sale vs. a foreclosure. Credit experts tell me that a foreclosure will generate a 200 point hit to your credit report as opposed to an average of near 50 points with a short sale. Also, if you work with a seasoned Realtor and they are able to successfully negotiate a short sale that eliminates a deficiency judgment, you do not have to worry about the bank coming after you for the difference between what you owe and what the property fetches at the foreclosure auction.

Most analysts feel that we are in for a long ride before property values are anywhere close to the levels of 2007. At the April meeting of the Real Estate Insiders Club here in Las Vegas, Mary Riddel, Associate Professor of Economics at UNLV, made it clear that she believes we are in for about 8-12 years before we see any substantial appreciation in real estate values in the Las Vegas Market.

So what are your options at this time?

Keep in mind that I am not an Attorney, CPA, or Investment Advisor and I do suggest that you seek legal, professional counsel before deciding how to proceed. My goal here is to give you some general outlines and to summarize your present options.

Hang On: If you can, this will preserve your credit. In considering this option though, you need to determine if you can afford negative cash flow from your unit over the next 10 years or longer until values rise to more than the amount that you owe and/or cash flow becomes greater than your costs of ownership.

Foreclosure: Most likely your worst option of the bunch. If you stop making payments on your unit, the bank will eventually auction off the property and take it away. This will hurt your credit tremendously and stay on your credit report for up to 7 years. You will also be vulnerable to a deficiency judgment.

Deed in Lieu of Foreclosure: Just turn the keys into the bank and be done with it. This will immediately release you from most of your personal indebtedness associated with the defaulted loan, however you will still be vulnerable to a deficiency judgment. A deed in lieu will hurt your credit a little less than an actual foreclosure but far more than a short sale.

Short Sale: More and more property owners are now looking at this option. With an experienced Realtor, you have a good chance of being able to successfully navigate the short sale process and sell your property to the new investors now coming in. However, if you inadvertently hire an inexperienced representative, you may very well find your unit foreclosed upon before you are able to get a short sale approved by the bank and sold to a buyer.

If you are considering short selling your Regent unit, I would love to discuss your options with you. I specialize in both the Regent and short sales. I am currently successfully negotiating 5-7 short sales per month and we are seeing bank approvals coming in at a much faster clip in the last few months.

Please feel free to contact me should you have any questions at all about the market, and/or the process for properly handling your unit.

Glenn Plantone

(702) 769-9872 or gsplantone@gmail.com

Short Sales Continue to Rise at MGM Signature Towers

2010-04-27T17:37:00.000-07:00

As a licensed Realtor here in Las Vegas, over the last three years I have followed the sales trends at the MGM Signature Hotel Condo very closely. (I have also sold 15 units over that time period.) I have also written and published several articles geared primarily towards investors looking to purchase MGM units at today’s new, low prices. This article is directed more towards the original owners who purchased properties at the height of the market and are now finding themselves upside down in their units. In this article, I will offer information on current market statistics and what options may be available to MGM Signature owners going forward.

As you are probably aware, since the MGM property auction of April, 2009, prices have been dropping dramatically. In the first quarter of 2010 (Jan 1st to March 31st), we saw 18 one bedroom units at the MGM Signature sold through the multiple listing service. Unit 125-714 established a new, low price for one bedrooms at $165,000. This same unit had sold new in 2007 for $705,000. That means the new sales price was roughly 24 cents on the dollar. During the first quarter, the highest sale price for a one bedroom was $271,000. These sales statistics do not include cash deals at the trustee sale.

Studios at the MGM Signature in the first quarter of this year sold for prices ranging from $114,000 to $218,000. Unit 125-205 is a low floor, strip side studio unit with a patio that sold new for $485,000. It sold this quarter for $114,000. (Also approximately 24 cents on the dollar.) The good news for new investors is that studios can actually cash flow at these lows. One bedrooms are still not cash flowing, even at the new lows, because of their higher HOA dues. This is the reason why we are seeing the studios in the MGM towers selling for a higher price per square foot than the one bedroom units.

Since the beginning of 2009, when we began to see foreclosures mounting at the MGM Signature, there have been a total of 168 studios and 67 one bedroom units foreclosed upon and resold within the 1728 unit complex. This represents about 14% of the total complex. I believe that we will continue to see distressed sales on MGM Signature properties since virtually every original investor is upside down and very few paid cash for their entire investment. However, I do believe that the nature of those distressed sales is changing in a very significant way.

As of this writing, there is only one bank owned REO foreclosure unit in the entire project. This is because foreclosures are slowing dramatically and being replaced by short sales. There are a total of 41 units currently listed for short sale. Because of the government’s push to get short sales approved and accepted, they have picked up dramatically in the Las Vegas market. Last year short sales amounted to 8% of all sales while REOs accounted for about 75%. Already this year, short sales have risen to 25% of all sales while REOs have dropped to 50%. At this rate, I project that we will see a total switch of REOs and short sales by the end of the year.

There is a huge advantage to having your unit go through a short sale vs. a foreclosure. Credit experts tell me that a foreclosure will generate a 200 point hit to your credit report as opposed to an average of near 50 points with a short sale. Also, if you work with a seasoned Realtor and they are able to successfully negotiate a short sale that eliminates a deficiency judgment, you do not have to worry about the bank coming after you for the difference between what you owe and what the property fetches at the foreclosure auction.

Most analysts feel that we are in for a long ride before property values are anywhere close to the levels of 2007. At the April meeting of the Real Estate Insiders Club here in Las Vegas, Mary Riddel, Associate Professor of Economics at UNLV, made it clear that she believes we are in for about 8-12 years before we see any substantial appreciation in real estate values in the Las Vegas Market.

So, if you are an upside down MGM Signature owner, what are your options?

Keep in mind that I am not an Attorney, CPA, or Investment Advisor and I do suggest that you seek legal, professional counsel before deciding how to proceed. My goal here is to give you some general outlines and to summarize your present options.

Hang On: If you can, this will preserve your credit. In considering this option though, you need to determine if you can afford negative cash flow from your unit over the next 10 years or longer until values rise to more than the amount that you owe and/or cash flow becomes greater than your costs of ownership.

Foreclosure: Most likely your worst option of the bunch. If you stop making payments on your unit, the bank will eventually auction off the property and take it away. This will hurt your credit tremendously and stay on your credit report for up to 7 years. You will also be vulnerable to a deficiency judgment.

Deed in Lieu of Foreclosure: Just turn the keys into the bank and be done with it. This will immediately release you from most of your personal indebtedness associated with the defaulted loan, however you will still be vulnerable to a deficiency judgment. A deed in lieu will hurt your credit a little less than an actual foreclosure but far more than a short sale.

Short Sale: More and more property owners are now looking at this option. With an experienced Realtor, you have a good chance of being able to successfully navigate the short sale process and sell your property to the new investors now coming in. However, if you inadvertently hire an inexperienced representative, you may very well find your unit foreclosed upon before you are able to get a short sale approved by the bank and sold to a buyer.

If you are considering short selling your MGM Signature unit, I would love to discuss your options with you. I specialize in both the MGM Towers and short sales. I am currently successfully negotiating 5-7 short sales per month and we are seeing bank approvals coming in at a much faster clip in the last few months.

Please feel free to contact me should you have any questions at all about the market, and/or the process for properly handling your unit.

Glenn Plantone

(702) 769-9872 or gsplantone@gmail.com

How to Calculate Real Estate Capitalization Rates (CAP Rates)

2010-04-05T07:39:00.000-07:00

If you are looking to purchase investment property, you are going to see the term CAP rate, or real estate capitalization rate, used quite frequently. Fortunately, CAP rate is easy to calculate and easy to understand.

The first step to calculating CAP rate, or capitalization rate, for investment real estate, is to determine the sales price. If you have already purchased the property, then you would simply use the total price you paid for the home including closing costs, etc. If you have not yet purchased the investment property,then use the asking price plus the amount you plan to pay for closing costs, etc.

The second step to figuring the CAP rate for an investment property, is to determine the yearly Net Operating Income (or NOI) for the property. In order to do this, take the monthly rent that you plan to receive for the property and multiply by 12 months. Then take the monthly operating expenses for the property and multiply by 12 months. Subtract the operating expenses from the rent total to obtain the Net Operating Income or NOI. (Remember, when calculating expenses, you need to total all expenses associated with renting the property, including maintenance, HOA fees, reserve fund, management fees, property taxes, homeowners insurance, etc.)

As an example: If you expect to receive $1500/month in rent, your total yearly rent will be $1500 x 12 = $18,000. If your monthly operating expenses are $300/month, then your yearly expenses will total $300 x 12 = $3,600. Subtract the expenses from the rent for a yearly Net Operating Income (NOI) of $18,000 - $3,600 = $14,400. The final step in calculating CAP or capitalization rate for a property is simply to divide the Net Operating Income (NOI) by the sales price. As an example: If you have a yearly Net Operating Income (NOI) of $14,400, and you purchased the property for $150,000, then you have a CAP rate of $14,400/$150,000 = .096 or just over 9% CAP Rate.

In my next article, I will discuss how to determine a target CAP rate for your investment properties.

If you would like more information on the Las Vegas rental real estate market or investing in Las Vegas properties, please contact me.

Glenn Plantone
702-769-9872
teamplantone@gmail.com

Great Las Vegas Investment Properties...But Will They Rent?

2010-03-30T21:10:00.000-07:00

Real estate prices have fallen over 70% in Las Vegas, and aggressive investors are now flooding back into the market to snatch up bargain properties. Real estate experts are touting the strong cash flow potential that Las Vegas properties now offer. Still, I have found that of the dozens of potential Las Vegas real estate investors I speak to every week, most of them share the same concern: Will I be able to find tenants for my investment properties? This is a great question. Exactly how strong is the rental market in Las Vegas? How long will it take to get your investment home or condo rented? What is the vacancy rate in Las Vegas?

Rental vacancy rates are published yearly and I am still waiting to see the data for 2009. But vacancy rates don't tell the whole story. Because rental vacancy statistics are heavily weighted towards apartment buildings, a high rental vacancy rate for a particular city does not mean that rental homes and condos are necessarily experiencing high vacancy rates. With foreclosure rates in Las Vegas leading the nation for the last two years, many families who are used to living in houses are losing their homes. These families look to rental house and condos to find a new home that fits their lifestyle. So even when overall vacancy rates in Las Vegas have been high, we have continued to see strong demand for rental houses and condos. My personal experience has followed this trend as well. On the 80 plus homes and condos I helped investors purchase last year alone, we are currently running close to a 95% occupancy rate.

It is true that average rents have fallen in Las Vegas over the last two years. But rents have fallen only around 20% while home and condo prices have plummeted over 70% from highs of three years ago. This disparity has created a great cash flow opportunity for investors now entering the deflated market. Homes that were $300,000 are now selling for $100,000 and renting for as much as $1300 a month. Condos that were $225,000 in 2007 can be had for $59,000 and are renting for $900 per month. Homes and condos are experiencing tremendous cash flow that is well above the 1% rule. (Rents should equal at least 1% of the purchase price in order to cash flow positively.)

In the last year, I have sold to many investors, but one in particular has done something that I believe I will see a lot more of this year. He has cashed out around a million dollars from the stock market, purchased 10 single family homes (all around $100,000), and is cash flowing hugely at this time. Average rents on his properties are at $1150 per month and all of his homes are now rented out. If you consider the numbers on his particular investment: Rental income minus taxes, home owners association dues, insurance, minor maintenance, and property management... he is netting about $800 per month, per house. Multiply this by his 10 properties, and he is netting close to $8000 per month in returns. This comes to just under a 10% yearly return on investment. I don't know anyone right now who is making 10% per year on their stock portfolio. And these figures don't even take into account the appreciation that he will receive year over year on his properties as the market continues to recover. Nor does it take into account the tremendous tax benefits that come from investing in real estate. Once appreciation takes effect over the course of the next several years, and rents continue to rise, this guy will look like a genius.

This gentleman took a calculated risk and faced his fears about the rental market and is feeling pretty good about it at this time. (Amir, you are my hero.) Now that he has hit his goal of 10 homes, he is planning on buying 10 more over the course of the next year.

If you would like more information on the Las Vegas rental real estate market or investing in Las Vegas properties, please contact me.

Glenn Plantone
702-769-9872
teamplantone@gmail.com

Fierce Competition for Available REOs Means Investors Need to Change Course in 2010

2010-03-22T13:41:00.000-07:00

I love the Las Vegas real estate market! Just like the city itself, the Las Vegas real estate market is always changing, always exciting. We saw the market reach bottom last year and begin to stabilize again as investors rushed back in to Las Vegas to snatch up foreclosure deals that generated phenomenal cash flow and excellent potential for appreciation. 2009 was definitely the year of the bank owned foreclosure property, or REO. In 2009, nearly 75% of all real estate sales in the Las Vegas valley were bank owned foreclosures (of the 71 homes I personally sold last year, 69 were foreclosures). However, towards the end of the year, these numbers began to change. Foreclosure inventories started to tighten up and as the year went on, the number of foreclosures as a percentage of total home sales continued to shrink. By January of 2010 only 57% of all Las Vegas real estate sales were bank owned foreclosure properties. Why?

The short answer is that there are fewer homes going into foreclosure. In December, 2009 there were only 1228 homes and condos foreclosed upon in all of Las Vegas, and in January, 2010 there were just 1352 homes and condos that made their way to the foreclosure trustees sale. These numbers are way down, to less than 15% of the total number of foreclosures reported in Las Vegas during the same months a year earlier. A major reason for this decrease in foreclosures, is the change in focus at the banks from foreclosing to short selling or modifying loans. As the Obama administration continues to push for banks to work with beleaguered home owners, short sales have risen sharply, as foreclosures have declined.

After having been in the low teens in early 2009, the number of short sales as a percentage of total home sales in Las Vegas rose to 22% in February of 2010.

I believe that short sales will be the answer in 2010 for investors looking to acquire property in Las Vegas at discounted prices. As REO inventory continues to shrink, even all cash investors are finding that while prices are low and cash flow is high, getting an REO under contract is a difficult and often unsuccessful prospect. By the end of 2009, homes listed in the multiple listing service (MLS) were, once again, like the old days of 2004 and 2005, getting multiple offers and selling for levels above their listing price. Houses that are priced right can be getting 10 to 15 offers within the first couple of days on the market. In February of this year, 50% of all home and condo sales were cash deals. The investors are back again in Las Vegas and they are dominating the market place. At this point, it is virtually impossible for a VA ($0 down) or FHA (3.5% down) buyer to get an REO home under contract. Both investors and potential owner occupants have a much better shot at securing a home if they go with a resale or new construction home. Unfortunately, resales and new construction do not offer the great prices that REOs do. So what is an investor to do?

I believe that the next great way to acquire properties will be through short sales. Short sales are gaining momentum as banks realize that they present a much better alternative for all parties involved than a foreclosure. Althoug short sales may sell for around the same price as bank owned REOs, the bank saves all of the fees and costs associated with a foreclosure, so their bottom line is much better. Plus, having a tenant or owner in place means the property will likely remain in better shape (less theft and vandalism) than a foreclosure. Short sales also represent a faster sale for the bank with no rehab and no down time for vacancy. Short sales are also great for investor buyers as they are much less competitive than REOs and in many cases they come with a built in tenant. Frequently, the owner or renter will wish to stay in the home they have already been living in and, in some cases, may even pay higher than average rent to do so.

New legislation, such as the Home Affordable Foreclosure Alternative Program (HAFA), which takes effect on April 5th, will aid homeowners in getting short sales approved and should keep more people from losing their homes to foreclosure. The banks are already receiving government incentives to negotiate with homeowners and facilitate short sales, so this new legislation should only further ease the process. Some banks are starting to implement new, more streamlined systems for short sale negotiations, such as Bank of America's new "Equator" system. It will take time to see how these new systems work, but I personally just got a B of A short sale approved at record speed this week.

In the last week alone, I have had 3 short sales approved and accepted by the bank. The first one was a 2200 sq ft. SFH at only $119K and the other two were 2 bedroom condos at $48K and $50K. All three of these were tied up by my investors in a matter of minutes after I announced them. This method of concentrating on bank approved short sales is undoubtedly the best way to purchase property in 2010. There are no multiple offers, no need to bid way over list price to secure a deal, just simply "I want it and I got it" at the approved price.

Being a small boat in the ocean enables me to quickly change and adapt to the continuous fluctuations in the Las Vegas real estate market with quick precision. This gives me a tremendous advantage over the large REO companies (ocean liners) that need to retool, chart their new course and attempt to change direction. Mark my words, short sales will be a very large part of the Las Vegas Real Estate Market in 2010. This is where we all need to be focusing our buying efforts.

If you are interested in purchasing short sales in the Las Vegas area, contact Glenn Plantone at:
(702) 769-9872 or teamplantone@gmail.com

How to Buy Investment Properties in 2010

2010-03-10T16:42:00.001-08:00

For much of 2009, the quickest, easiest and best way to purchase an investment property in Las Vegas, was to purchase a bank owned foreclosure, or REO. In fact, 75% of all sales in Las Vegas in 2009 were bank owned REO foreclosures. In some individual months, this number was as high as 85%.

But then a funny thing happened...Banks started to realize that short sales present a viable way for them to receive money on their loans without having to go through the hassle and expense of a foreclosure and resale. The government also stepped in with a series of new regulations aimed at slowing the nation's foreclosure rate and encouraging banks to negotiate short sales. These factors, combined with sustained high demand for REO properties, has pushed REO foreclosure inventory in Las Vegas to unbelievably low levels.

As of this writing, REO inventory listed on the MLS in Las Vegas stands at 1331 single family homes available for sale (not counting contingent and pending sales.) This number has been decreasing for about a year and now represents less than a two week supply of REO inventory. 3429 homes sold in Las Vegas in January, 2010. During the same month, only 1352 foreclosure homes went back to the banks. This represents an amazingly low supply of only 11 days of REO inventory on today's market.

Investors and realtors are seeing firsthand the results of this dramatic decrease in inventory. With prices in the Las Vegas valley continuing to hold at record lows, the competition for available REO inventory has been extremely stiff. Many investors, including my clients, are having to put in upwards of 10 offers to get just one accepted. Cash buyers continue to represent about 50% of the market and primary occupants or investors with financing in place are finding it very difficult to compete. Of the nearly 75 deals I closed last year for my investor clients, only 5 were not all cash deals. And even with all cash buyers, I have found it more and more difficult to secure properties.

As a result, I believe that 2010 will be a big year for short sales. A short sale is when a bank accepts a sale price that is less than the amount owed on the home. Short sales can be a great win-win situation for both buyer and seller. The seller is able to get out from under their loan without the negative effect on their credit that a foreclosure would have. The buyer is able to purchase a property for much less than current market value. Once a home or condo is approved for a short sale by the bank, the buyer will typically have 30 days to close on the home.

As available REO inventory in the Las Vegas valley continues to shrink, I am expecting the number of short sales to continue to increase. The amount of short sales this year is already close to double month-over-month from last year's totals. I am currently getting two to three short sales approved per month.

By way of example, I have a short sale available now that is a 2221 sq. ft., 4 bedroom/3 bath home for $119,995. This home sold new three years ago for $329,000. It is now priced at only $54/sq. ft., well below builders' replacement costs. This home only needs about $2500 to be fully rent ready (carpet cleaned, repaint, a couple of appliances) and then it will rent for $1295 per month.

HUD Drops 90 Day Seasoning Rule - Makes Acquiring and Reselling Foreclosures Even Easie

2010-01-28T17:53:00.000-08:00

The Department of Housing and Urban Development recently announced a temporary policy change that will have significant positive benefits for anyone looking to acquire foreclosures, especially those looking to fix and flip. Previously, FHA has required that any borrowers seeking to finance their home purchase using an FHA loan, must purchase the property from a seller who has been the owner of record for 90 days or more. This has made it difficult for investors looking to rehab gutted foreclosure properties and resell them for a reasonable profit since they then had to either hold the property for 90 days (dramatically increasing their holding costs and decreasing potential profit margin) or they could not sell to buyers looking to purchase a property with an FHA loan product. The 90 day seasoning rule also made it difficult for investors or primaries looking to purchase REOs using FHA loans. With the available inventory of REOs shrinking and demand rising, banks are usually able to liquidate their best REOs on the open market within days or weeks of taking title after a foreclosure. Since the bank did not, in those cases, own the property for 90 days or more, those looking to pick up bargain priced REOs using an FHA loan couldn't do so.

This will all change starting February 1st when HUD will begin a one year period during which the 90 day seasoning requirement will be lifted. In a document announcing the change, HUD Secretary Shaun Donovan said, "As a result of the tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential home buyers. FHA has an unprecedented opportunity to fulfill its mission by helping many home buyers find affordable housing while contributing to neighborhood stabilization."

"FHA borrowers, because of the restrictions we are now lifting, have often been shut out from buying affordable properties," said FHA Commissioner David H. Stevens. In the same document Stevens states, "This action will enable our borrowers, especially first-time buyers, to take advantage of this opportunity."

The temporary lifting of the 90 day seasoning requirement will come with some restrictions that are designed to prevent abuses. Probably the most significant is a clause stating, "In cases in which the sales price of the property is 20 percent or more above the seller's acquisition cost, the waiver will only apply if the lender meets specific conditions." It appears that all that is necessary to meet these "specific conditions" is to show that substantial improvements/repairs have been made to the property to justify the extra cost. This should not be a problem for rehabbers as they can show these improvements via receipts, before-and-after photos and descriptions of work completed etc.

This change to the FHA guidelines is scheduled to only last for a year, so now is definitely a great time for investors interested in flipping properties and home buyers looking to purchase a residence to jump into the market. If you are interested in purchasing REO properties for investment purposes in Las Vegas, foreclosure capital of the nation, please contact Glenn Plantone today.

Glenn Plantone (702) 769-9872 or teamplantone@gmail.com

MGM Update January 2010

2010-01-19T11:58:00.000-08:00

As those of you who follow my articles and blogs know, I have been tracking the MGM Signature Towers Hotel Condo in Las Vegas very closely over the last year. Many of my investors have asked me to write an update on the project. Here is the most recent information on price and sales trends from the beginning of last year (2009) to the start of this year (2010).

The MGM Signature is a Hotel Condo complex consisting of three high rise buildings that were completed in 2006. This makes it one of the few Las Vegas high rise condo projects that was completely finished and sold at boom prices. All three buildings (576 units per building) totaling 1728 total units were sold before the real estate bubble burst in 2007. In 2006 an average studio unit (520 sq. feet) sold brand new for $485,000 and an average one bedroom unit (874 sq feet) sold for $745,000. The least expensive studio sold originally for $318,250 and the least expensive one bedroom was sold for $494,000. Most were financed with 20% to 30% down and there were very few cash sales.

The MGM now represents a unique buying opportunity for investors as the real estate crash has sent prices tumbling to between $0.20 and $0.25 on the dollar from their original sales prices only four years ago. By the end of 2009, we were seeing several studios selling in the $120,000 range and one bedrooms in the $180-$190,000’s. I have followed the project since the prices started falling in 2007 and by 2009 I was ready to recommend the project to my investor clients. I continue to work hard to find units for my clients and the lowest possible prices and because of my experience and knowledge of the project, I have the distinction of having negotiated the lowest purchase prices for both a studio ($99,900 at the end of 2009) and a one bedroom unit ($176K for a beautiful 8th floor pool and mountain view just one week ago.)

In 2008 we saw very few foreclosures and very few resales on the MGM properties. That changed dramatically in 2009. Last year there were over 220 studios and 90 one bedroom units that were foreclosed upon. This figure represents about 18% of the total project. By comparison, other condo projects in Las Vegas experienced foreclosure rates as high as 35% in 2009. I believe that we will see an avalanche of foreclosures on the MGM Signature properties in 2010. Normally, this wave of foreclosures would mean even lower unit prices to come. But I think the heavy demand for the MGM Signature units will keep prices stable throughout 2010. Because the prices have dropped so steeply, the properties are now able to generate positive cash flow. This is keeping demand extremely high for the few available units that come onto the market. We have run into multiple offer situations for all of the foreclosure units that have come onto the market over the last several months.

The MGM Signature was built and marketed as a hotel-condo, as such, it offers tremendous flexibility. You are able to live in the unit full time if you desire, rent it out independently to a long term tenant, lease it out for short term nightly rentals and manage it yourself, or place it with a management company who will handle short term nightly rentals for you and split the revenue with you. Using a management company is the most popular choice for most investors. With sufficient notice, you are able to stay in your own unit as often as you like with minimal cleaning costs if you choose to have the room serviced by your management company. Most investors use the MGM Hotel Residential Services Company as their management company, but many do not realize that there are three other companies that provide excellent service, some with higher occupancy and in most cases better revenue splits for the investor. This, of course, could mean a higher cash flow on your investment. I have a detailed analysis of the similarities and differences between the four companies if you should desire to compare them. (Contact me if you would like to receive a copy of this comparison.)

Currently, there are four ways to buy a unit at the MGM Signature. The first is to buy a resale unit. I don't recommend this method. Resale units are either units that have been bought by other investors at cheaper prices and are now being resold or units where the owners are desperately trying to lose as little money as possible on the sale.

The second method is to purchase a short sale. The short sale route is long and tedious but we have had some success. We tie up the unit at a good low price and wait and hope that the negotiator is able to get an approval from the bank before the unit is sold off at the foreclosure auction. I have had a couple of short sales that have ended with a successful purchase and lost a couple to the foreclosure auction.

The third way to acquire MGM Signature units, is to buy a bank owned foreclosure property (an REO.) This is a great method and the most common way I use to acquire properties for my investor clients. We are able to get a good look at the unit, get good clean title, and have the purchase of the unit done safely and easily. Because of my contacts with the various listing brokers I have been able to develop great relationships and purchase many units for my investors at the best possible prices.

The final way to acquire units, is to buy them at the foreclosure auction (trustee's sale) before they return to the bank and become an REO. This method has its risks but with proper due diligence it represents the absolute best way to get the lowest price possible.

I have been very successful in purchasing Signature units for my investors because I have been attacking this project from all three sides.

I highly recommend that anyone interested in the MGM Signature come and stay at the hotel-condo and visit with me so that you can gain a clear understanding of all the variables that are involved in this project. We can tour the property, talk about and meet with the management companies, look at the one bedroom vs. the studio units, discuss the psychology of views (strip side vs. mountain side) and get a general overall understanding of the property.

I will be following the MGM Signature Towers very closely this year as I project it will be a great time to pick up units at prices well below the developers cost to build. Feel free to contact me directly should you have any questions or interest. May we all have a great 2010.

Thanks

Glenn Plantone

702.769.9872 (cell)

teamplantone@gmail.com

2009 In Review

2010-01-11T13:50:00.000-08:00

2009 was a year of expectations and a year of hopes. Some of these were met, some were exceeded, and others will wait and continue to seek fulfillment in 2010. We all knew that the foreclosure wave would continue to sweep over the nation’s beleaguered real estate markets. And it did. Las Vegas once again led the United States in foreclosures as more bank owned properties than ever flooded the market. We hoped that this influx of affordable properties would lure some investors back into the stagnant Las Vegas real estate market. But no one expected just how tantalizing that lure would be. As investors from California, Canada, and all over the world sought to purchase cheap Las Vegas real estate that was suddenly cash flowing positively for the first time in years, home sales in the valley boomed. Throughout the summer of 2009, Las Vegas posted sales numbers that exceeded those of the boom years in 2003 and 2004. As quickly as foreclosures re-entered the market, they were gobbled up in their REO form by eager investors cashing in on what had become the greatest real estate buying opportunity of our lifetime.

And we all hoped that this re-energizing of the real estate market would spread to the economy at large. It didn’t. To spite the high hopes of many generated by the seemingly endless stream of economic stimulus packages introduced by the new Presidential administration, an economic recovery failed to materialize and December saw some of the worst unemployment statistics since the recession began.

And yet, this bad news for the economy at large, may translate into good news for investors looking to purchase real estate in 2010. Normally, the excess of demand that we have been seeing in the Las Vegas market would push real estate prices higher. But the general economic downturn may curb those price hikes and keep properties in Las Vegas at their historically affordable levels through the next year. Especially for those willing to acquire properties through the trustee sale, properties that need a little work, or unconventional properties like high rise condos.

As the supply of turn key, single family REOs has dwindled over the latter half of the year, my investors have found that the best way to acquire profitable real estate in Las Vegas is to think outside the “herd.” We have been investing with great success in properties purchased through the trustee sale auction, high rise properties like the MGM Signature Condos, and properties that are not “turn key” such as “stripped” foreclosure homes. Since the vast majority of investors are not purchasing these types of properties, we are able to continue to get great deals on investments that will generate strong positive cash flow.

I look forward to 2010 as a year that will continue to allow my clients to purchase Las Vegas real estate at deeply discounted properties. Hopefully, the nation’s job, credit, and financial markets will begin a steady recovery and everyone can begin to benefit again from a robust economy. Until then, we are wise to once again remember the words of the great financial giant Baron Rothschild who made his fortune largely during the years of the Great Depression, he said, “Buy when there is blood in the streets...even if the blood is your own.” Now is truly the time to take advantage of every opportunity to create wealth for our future.

If you are interested in taking advantage of this historic opportunity to purchase great Las Vegas real estate, contact Glenn Plantone at 702-769-9872.

Stripped Homes Offer Great Profit Potential

2010-01-04T11:27:00.000-08:00

It's the newest thing in housing these days... 4 BD/3BA... no kitchen. No kitchen, no ceiling fans, no landscaping, even no light fixtures. Yes, it appears that appliances and hardware are the latest casualties in the nation's foreclosure meltdowns. A recent article in the New York Times calls attention to this growing phenomenon. It cites a recent ad in Craig's List where the owner makes no effort to hide his intentions. " 'Stripping House — Before Foreclosure,' the ad declared, offering potential buyers the cabinets and counter tops, the sinks and toilets, the doors, the appliances, the sprinklers. Even the palm and citrus trees in the yard were for sale, with a catch. 'You dig,' the author advised." According to the article, areas like Las Vegas, which have seen the nation's highest foreclosure rates, have also been affected the most by home strippers.

Some metro areas, like Phoenix, have laws in place that make stripping homes prior to foreclosure a felony under a state fraud statute. In cities like this, the FBI has been able to apprehend home owners attempting to liquidate appliances. Although the sentences for these crimes is usually quite light (18 months probation for a recent offender), police hope that criminal prosecution may deter home owners from trying to strip their houses before they leave. But in other cities, like Las Vegas, there are no laws that make gutting your property prior to eviction illegal. Mortgage contracts do specifiy that homes must be kept in good order, but the lack of state law on the subject makes the issue a civil, rather than a criminal, matter. And legally pursuing home owners that sell off a home's assets prior to foreclosure is not usually a profitable venture for the bank, as costs of a lawsuit greatly outweigh potential recovery.

This has led to rampant home stripping in the Las Vegas area. But we don't need an article in the New York Times to tell us that. I see these stripped homes first hand every day. In fact, they have provided me and my investor clients with some great money making opportunities.

One of my most recent purchases was a 2113 square foot home that was only three years old. When we walked through the house, it was a mess. It had no kitchen and needed new paint, carpets, and various hardware items that had been stripped. We purchased the house for $104,000. It had been sold new for $319,000. After putting in a brand new kitchen for $4500 and spending $1500 on new carpets and $1500 on new paint and accessories, we had a beautiful home for a total of $112,000 ($53 per square foot.) We were able to turn around and lease the property under a two year contract for $1295 per month. This created terrific cash flow for my client and translated to acquiring the home for $0.33 on the dollar at an 11% cap rate (based on the $104K cash purchase.)

These types of deals are available for anyone who is willing to put in the time and effort to revamp one of these foreclosure homes that have been gutted by the previous owner.

Surviving and Thriving as a Real Estate Agent: Part 3

2009-12-22T12:36:00.000-08:00

In my last two articles, I have discussed how real estate agents can not only survive, but thrive in this challenging real estate market. I have covered the first three points in my four point plan:

1. Develop Your Niche
2. Become An Expert in Your Field
3. Be Mobile/Adapt
4. Develop a Marketing Campaign

Today I will cover the final point: Develop a Marketing Campaign.

Once I have developed my niche and determined specifically where I am going to invest and recommend that my clients invest, I create my marketing campaign to go find the investors. I could easily write an entire book just on marketing for real estate agents, and I look forward to sharing more articles with you in the future on this topic, but for now I will share a few brief thoughts here to put you on the fast track. The marketing materials that I use are designed to aid the investor in making an informed decision on the investment they are currently considering.

• The first item in this package is the “e flyer.” This flyer is a colorful,
eye catching marketing piece that lists all the features and benefits of
the potential investment in a concise, easy to understand format. I
send these flyers out to investors in the form of email blasts and
their purpose is to catch the investor’s eye and encourage them to read
more about the investment opportunity that I am offering. To view an
example of one of my recent investment
flyers:www.viewpointequity.com/MGMFlyer.pdf
• The second item that I include in my marketing package is a
proforma worksheet. I have always used proformas to analyze
my own investments and I find it is an excellent tool to share
with my clients as they consider similar investments. If the proforma
is done well and accurately, it will not only aid the potential client
in understanding the financials of the investment, but it will also
build your credibility in the eyes of your customers as not just a
Realtor, but a seasoned investor that actually understands the
investment process. Having actual numbers plugged into a spreadsheet
gives the investor a sense of comfort with you and with the investment,
and helps to eliminate the feeling of the “unknown,” especially for
new investors. All-in-all creating an informative and professional
marketing package for the properties that you are looking to sell
and including realistic projections and other data helps investors
to accurately evaluate a deal and establishes valuable credibility for
you that will result in repeat business, referrals, and client loyalty.
• Another tool that I use with outstanding results is my monthly
newsletter. Different than a typical “Realtor” newsletter that might
feature recipes and other useful but non real estate related information,
my newsletter is filled with statistics, actual deals, potential
deals, education and opinions of the market in which I am currently
working. Sending this out to my database on a monthly basis allows me to
stay in front of them and remind them that I am always looking for the
next best deal when and if they are ready to get involved. To see my
latest newsletter: www.viewpointequity.com/newsletter.pdf
• My final, and perhaps most important marketing strategy, involves not what
I do, but what I don’t do. I have found that my strengths as a
business person lie in my abilities to create leads, talk to clients,
sell properties and negotiate deals. My strengths do not lie in the field
of internet marketing or graphic design. Because of this, rather than
spend my time working on my own e flyers and newsletters, I employ an
internet marketing/graphic design firm to handle these details for me. When
I am ready to create a marketing piece, I do the overall concept
management, writing, thinking, and analyzing and forward it on to
my specialist for the design of the marketing materials. Once back to me
I make suggestions and changes to put the final touches on the material.
I suggest that you too spend more time on the areas in which you
specialize and less time playing with graphic design programs on your
own computer. This one idea (the virtual marketing assistant) has helped
me tremendously in getting more effective marketing material produced
faster than I could otherwise produce myself, leaving me free to
pursue sales. If you are interested in contacting the firm that handles
my marketing, you can reach them through their
website:www.spiraldigitalmedia.com

If you follow these four simple steps, you will be well on your way to thriving as a real estate agent, even in a down economy.

Surviving and Thriving as a Real Estate Agent: Part 2

2009-12-18T14:39:00.000-08:00

In my last article, I discussed the steps Realtors can take to thrive even in these challenging economic conditions. These steps were:

1. Develop Your Niche
2. Become An Expert in Your Field
3. Be Mobile/Adapt
4. Develop a Marketing Campaign

In this article, I would like to discuss Steps #2 & #3 in further detail.

Becoming An Expert in Your Field

I cannot stress enough how important it is to identify a niche (as we discussed in the last article) and establish yourself as an expert in that particular area. Clients genuinely appreciate and flock to agents who really know what they are talking about. Do your research.

I have found that Google Alerts provides me with an excellent vehicle for educating myself and staying on the cutting edge of topics that I am interested in. All you have to do to use Google Alerts is to sign up for a Google or Gmail account, sign in to their alert system, register your key words/topics that you are interested in and begin receiving the best articles and blogs to follow on a daily basis.

When I identify a hot spot for investors, it is because I have done extensive research on that topic. I am able to combine the knowledge I derive from that research with the gut feelings that I have been able to develop over the years. I also travel extensively and am always personally checking out areas that are on my radar. There is no substitute for first hand knowledge. If you are planning on specializing in a certain development or neighborhood, make sure that you visit that area on a regular basis to stay abreast of changes, new growth, different conditions, etc. The last thing you want is to market yourself as an expert in a certain area and then be surprised when your potential client knows more about the project or neighborhood than you do.

Also, in my research, there are some experts in their respective fields that I follow closely and whose opinions I respect. These individuals and groups include: Bruce Norris and the Norris Group, John Burns Real Estate Consulting, Robert Shiller and the Case Shiller Index, and local Las Vegas economist Keith Schwer. These men and their support staffs do an amazing amount of research and by reading up on their newsletters and reports it is easy to stay on top of and spot trends in the marketplace.

Be Mobile/Adapt

I would like to expand on the idea of traveling to the investment hot spots. Being in the places where people actually want to buy, and are buying, will enhance your chances of becoming a leader in your field. Specializing in a niche within a niche will also help establish your reputation as a leader in your area of expertise.

Between 2003 and 2006, I was heavily involved in several real estate markets. Whereever the hottest market could be found… I was there. I was in Las Vegas, Phoenix, Albuquerque, and North Carolina just to name a few. I stayed tuned-in to where investors were heading, as I was one of them, and invested in all of these markets myself. Since the summer of 2008, I have specialized once again in the Las Vegas valley, but this time it has been foreclosures and REO properties… not new construction homes. I knew it was time to gear myself back up for sales in the Las Vegas area as I watched the prices of single family homes and condos drop rapidly due to the glut of foreclosures flooding the market. These lower prices created homes that could be purchased and rented for very good cash flow… better than Vegas has seen in decades. I took the opportunity to begin educating myself about this niche in this market, develop my marketing materials, and get ready to welcome the investors that I knew would soon come running into the Las Vegas housing market once again.

Even if you cannot travel as extensively as I did in the search for the nation's hottest real estate markets, it is important to stay mobile within your own home area. Perhaps one neighborhood in your city or town is in transition. Perhaps a lot of rehabbers have moved in and are turning the neighborhood around. This might represent great upside buying potential for your clients. This phenomenon will only last so long though. Soon prices in the neighborhood will begin to rise and it will be time to move on and look for the next buying opportunity.

Above all, it is important to adapt. No one real estate market, or project, or strategy will work long term. We must be willing and able to continuously adapt. Our chosen niche will often dry up and we must be ready to pick a new niche and move on.

Next time we will discuss Step #4.

Surviving and Thriving as a Real Estate Agent: Through Good Times and Bad

2009-12-08T12:01:00.000-08:00

Surviving and Thriving as a Real Estate Agent: Through Good Times and Bad

It is no secret that real estate agents, as well as other real estate related professions, have had a difficult road over the last few years. The rise and fall of the national real estate market created a feast then famine scenario …and many agents have not survived the famine. Meanwhile, over the last 5 years, I have sold over 500 single family homes, condos, or land lots…including closing on 30 properties last month alone. This volume places me in the top 5% of all Realtors in the country (in both transactions and commissions.) I would like to share with you, over my next few articles, how I have been able to achieve this success. (And you don’t even have to buy a video course or purchase a web book!) My success through these difficult times has not been due to luck but rather due to a particular mindset that has worked very well for me.

Thinking As An Investor

This mindset has entailed thinking as an investor instead of as a Realtor. My career in real estate began as an investor. I enjoyed great success purchasing my own investment properties, and began to help other investors find deals for themselves. Several years later, the natural progression was to get my realtor’s license. As a result, I have never really considered myself a Realtor by trade, but rather an investor who helps other investors. At the moment I currently own over 20 investment properties myself. This helps me to understand what investors are looking for and the challenges they face in the current market. But owning your own investment properties is not a prerequisite to thinking like an investor. In order to position yourself as an investors’ Realtor you don’t have to own a lot of properties yourself, but you do have to develop a reputation with your clients for being more interested in their bottom line than you are in your commission. I have been able to do this, and in so doing grow a large investor database, by using the following strategies that I would like to share with you:

• Develop Your Niche

• Become An Expert in Your Field

• Be Mobile/Adapt

• Develop a Marketing Campaign

Over the next several articles, I will go over each of these steps in detail. Let’s start with the first one:

Developing Your Niche As An Investors’ Realtor

The first thing I have done is to develop a niche. I don’t try to know (or act like I know) everything about every area of real estate…rather I focus on a specific area. This area may, and sometimes must, change over time. In my case, I have always focused primarily on single family homes. For a while I worked on SFRs in CA, then I moved to AZ. I went through several other locales and for the last two years have focused on Las Vegas, NV. More specifically, I focus on the new Northwest area of the valley. 80% or more of my deals are located in this specific area. This is the area that I am comfortable with, knowledgeable about, and experienced in.

By becoming an expert in a particular area, I am better able to service my clients and identify for them the most profitable investments available. Reputation is everything in this business. You need to build a reputation for being well informed and very familiar with your area of expertise so that you can knowledgably and confidently advise your client whether or not a particular property will make a valuable addition to their portfolio.

In my next article, I will discuss how to become an expert in your chosen niche.

Drop Bids at Trustee Sales

2009-11-24T10:41:00.000-08:00

Drop Bids at Trustee Sales

The Arizona Republic recently ran an article discussing the practice of "drop bids" at the Maricopa County foreclosure auction. When a lender posts a Notice of Sale amount (often referred to as the minimum bid) and then drops the amount hours or even minutes before the opening of the auction, this process is known as a drop bid and is considered illegal in Arizona. Ideally, lenders are encouraged to post the Notice of Sale amounts for foreclosure properties that will be sold at the trustee sale at least 24 hours prior to the start of the sale.

According to the article, up until recently, the majority of homes brought to auction through the trustee sale were failing to sell and were reverting back to the banks. These properties would then re-enter the market as REOs. This all changed last month as a record 1,000 properties sold through the public foreclosure auction process. This was five times the number that sold in January. According to the Republic, "Real estate market watchers and unsuccessful bidders at the auctions say drop bids are driving the record number of auction sales."

No one seems to be sure why banks would choose to lower the minimum bid without adequate notice. Those who are up in arms over the practice tend to imply that the reasons are malicious, but there are other possibilities. Kelly Braaksma, a trustee sale expert and CEO of FAST (Foreclosure Auction Service Team) a company that specializes in helping investors to purchase properties at auction, says that the uncertainties surrounding properties coming to auction may have more to do with last minute price changes than anything else. "Lenders are inundated with foreclosure properties," Braaksma says, "of the hundreds or thousands of properties slated to be auctioned off at any particular trustee sale, only a few dozen may actually make it up to bid. The rest are postponed, canceled, reinstated, etc. All the aspects of the sale, including starting bid price, are constantly in flux right up until the last minute."

Whatever the reason, the Arizona Republic continues by saying, "Drop-bid purchases enable the few who know about the deals to buy homes and quickly resell them for hefty profits...Buyers aware of the "drop bids" scoop up the houses before other bidders know about the price drops."

Mr. Braaksma has developed a system that analyzes historical opening bids from various lenders, along with a myriad of other data and generates algorithms that predict which properties are most likely to actually make it to auction and which will most likely have opening bids that make them worthwhile to investors. I have formed an alliance with FAST in order to provide this service to my clients looking to purchase at the trustee sale. I don't charge more for the service, clients pay only my standard commission at the close of a sale. But for this commission, they are provided not only with all of the reports and data that FAST generates, but also with a representative that will be present at every Trustee auction, available to purchase these choice properties and take advantage of last minute drop bids.

If you are interested in using trustee sales / foreclosure auctions to acquire property, please contact me and I will send you a packet with more information on the process:
Glenn Plantone (702) 769-9872

Click here to read the full Arizona Republic article

Mind the Gap

2009-11-17T12:32:00.000-08:00

Mind the Gap

You know you've arrived in London when you step out of the "tube" and hear the oft-looped pleasantry over the loud speakers, "Mind the Gap!" The announcement is referring to the gap between the subway platform and the train. In the current Las Vegas real estate market, we must mind a gap of a different sort. Let me explain.

As a full-time real estate investor and investor agent (of my 80 sales so far this year, only 3 were to owner occupants) I am used to observing market trends first hand in my hometown of Las Vegas. As our market began to reach bottom 6-8 months ago, investor money from all over the country and internationally began flooding back into the valley looking to snatch up bargain priced Las Vegas real estate. For months, it was relatively easy for me to find great REO / bank-owned deals for my visiting investor clients. 85% of my clients were (and are) all cash buyers and I entertain an average of 4-6 investors each weekend. Las Vegas was (and continues to be) the foreclosure capital of the world, and for months REOs were in great supply.

But over the last several months, things have steadily begun to shift. I have had to work harder and harder to find good deals for my clients. I have repeatedly found myself in multiple bid situations and the competition for REO / bank-owned foreclosure properties has begun to drive up prices. September saw the first increase in median home price in Las Vegas in over two years. More and more investors are fighting for the properties that are available and potential owner occupants are becoming increasingly frustrated as banks accept one of the multitude of "sure thing" cash offers that seem to be present at every REO listing.

The reason for this feeding frenzy is simple: Demand is far exceeding supply. In the month of September 2009, nearly 3500 single family homes sold in Las Vegas. By contrast, only around 1800 homes went back to the banks through the foreclosure process. This creates a large "gap" between supply and demand. At first glance, one would think that this gap represents good news for primary residents struggling to sell properties through the "normal" sales process. For the last two years, it has been virtually impossible for normal listings to sell in Las Vegas as they had to compete with the overwhelming numbers of foreclosure properties that were making the market. So now that the supply of foreclosure homes is beginning to slow and the demand for properties is increasing, we should begin to see more homes selling through traditional listings right? Maybe not.

In order to understand this phenomenon, we need to be mindful of another "gap." The gap between the prices of bank-owned foreclosure properties and the prices at which owners can afford to list their homes. Prices have dropped so sharply in the Las Vegas valley over the last three years, that many properties have lost 70% of their value. Homes that were selling for $300,000 in 2004, are coming back on the market as foreclosures now for $110,000. This means that anyone who purchased property in Las Vegas in the last 10 years is probably upside down on their home. Those who purchased 3-5 years ago are drastically upside down.

This gap means that even as demand for property in Las Vegas increases, and supplies of bargain-priced foreclosure / REOs decrease, we are still likely not to see many traditional listings and closings for quite some time. The gap between what is owed on the homes and what the market will pay is just too great. The exception to this might just be the short sale, which is making a comeback as I addressed in my two previous articles.

Short Sales vs. REOs

2009-11-10T10:30:00.000-08:00

As of September 2009, the nation's supply of REO homes has begun to shrink, even in foreclosure capital Las Vegas, NV. As investors flood back into distressed markets, we are seeing multiple bid situations for most REO or bank-owned foreclosure properties coming back onto the market. With demand exceeding supply, it is becoming harder and harder for investors to purchase REO properties at discount prices. Also, with the Obama administration offering hefty incentives for banks to help homeowners avoid foreclosures, REOs are becoming more scarce. Instead, we are seeing short sales skyrocket in popularity as banks have suddenly become willing to negotiate this option.

Many of my investor clients have asked me to explain the differences between short sales and foreclosures/REOs. First, the definition of each: A short sale occurs when a buyer negotiates with the bank to purchase a home from the seller for less than what the seller owes on the mortgage. In many cases, where the equity in the property has dropped sharply, this means that the second lien holder (if any) receives next to nothing on their note (think $1000 for a $90,000 note as an example) and the first position lender very often must still except less than the amount of the first mortgage. REOs are bank owned properties that have already completed the foreclosures process. The owner of the property, upon failing to make their mortgage payments, has been notified of their delinquency, received a notice of default and then a notice of sale. Subsequently the property has been sent to auction at the trustee sale where, in absence of a successful winning bid, it has reverted back to the bank holding the mortgage. These properties are then re-listed by the banks on the open market as REOs or Real Estate Owned meaning bank owned real estate.

The major differences between the two transactions can be summed up in two categories: Differences to the Buyer and Differences to the Seller.

Differences to the Buyer

Difficulty of Transaction - Short sales are traditionally much more difficult to transact than purchasing an REO. Once a bank has taken possession of a foreclosed property and re-listed it as an REO, that REO property can then have offers placed upon it and the bank will respond to those offers just like any other seller. Short sales must go through a special evaluation and approval process at the bank. This process usually involves not only evaluating the fair market value of the property, but also evaluating the potential of the current owners to continue making their payments. Sometimes, a bank will offer to modify the existing loan if the sellers wish to stay in their property rather than negotiate the short sale. This can result in the property being pulled from the market altogether.

Time Frame for Closing - REOs can often close in a 30 day escrow just like a normal transaction. Short sales can take months to negotiate and then might not be approved at all.

Price - Because the buyer is usually not competing against other offers in a short sale situation, they can often obtain the property for less than what the same property might end up costing as an REO.

Differences to the Seller

Future Home Purchases - Homeowners who go through a foreclosure cannot apply for an FHA loan for 5 years after the date of foreclosure (7 years for investors), but homeowners who complete a short sale can apply for an FHA loan 2 years later. When homeowners apply for a loan through a mortgage company, they must state on the application if they have had a property foreclosed upon or given a deed in lieu of foreclosure within the last 7 years. There are currently no questions on standard mortgage applications asking whether or not a homeowner has ever completed a short sale.

Credit Score - A foreclosure will typically lower a homeowner's credit score by somewhere between 250-300 points and this decrease will last approximately 3 years. Short sales can often affect an owner's credit by only 50 points and that decrease may sometimes be remedied in as little as 12-18 months.

As the supply of REO properties continues to be tight across the country, short sales are presenting a good buying opportunity for would-be investors looking to re-enter the market. They can also provide a win-win situation for home owners looking to escape a negative equity position with less of a hit to their future purchasing potential and credit score.

Trustee's Sale Becomes Best Buying Option as Home Prices Rise in September

2009-11-05T11:46:00.000-08:00

As you may know I have been very heavily involved in the Las Vegas real estate market for the last six years, both as a private investor and as a licensed real estate agent. As an agent specializing in undervalued properties, I have sold homes and condos to both owner occupants and investors at great discounts...before and after the bubble burst.

The current Las Vegas market represents one of the greatest buying opportunities that we have ever seen in real estate. Prices have over-corrected as a result of the credit crisis and have come down to levels that are way below builders' costs. We are seeing condos selling at about $35-$45 per square foot and single family homes selling as low as $50 to $60 per square foot. From October of 2007 to May of 2009, the average median home price in Las Vegas fell approximately $10,000 per month...every month. As prices began to stabilize in the summer of 2009, investors realized that a bottom was arriving and began to flood back into the market. This past summer saw record sales volume in the Las Vegas valley. There were over 3700 closes in both June and July, 2009...beating even the previous monthly highs set in the summer of 2004, at the height of the bubble. Of these closings, 45% were cash deals and 40% were to investors (as opposed to owner occupants)...these numbers also exceed the percentages posted in 2004.

This extraordinary demand for great properties at great prices in Las Vegas caused the median home sale price to increase in September...the first increase in the Las Vegas market in over two years. September also saw sales taper off slightly. The general consensus, however, is that this decline is not because of a reduction in demand, but rather because of a drastic reduction in supply. In September only around 1800 homes were returned to bank ownership through the foreclosure process. In contrast, 3358 single family homes sold in this same month. Since almost 70% of all these sales were on foreclosure/REO properties, this represents a situation where more homes are being sold than are coming on to the market. The prices are low, the demand is high and, as a result, prices are starting to creep up on these REO sales. In addition, we are seeing multiple bid situations on almost every REO property that comes up for sale. These circumstances are making finding good deals by buying REO properties very difficult.

The most viable option at this time for acquiring properties below market value is at the trustee’s sale. Once the owner of a property passes his 90 day notice of default period, he is issued a notice of trustee’s sale. After the NOS, or notice of sale, is given, the owner has 21 days to cure the default or the property will be sold to the highest bidder at the trustee’s sale. Buyers at the trustee’s sale in Las Vegas are currently picking up properties for a discount of about 20% under the already heavily discounted REO listings that are setting current market values. For example: If a home sold in 2007 for $300,000, and it is now worth about $100,000 on the REO retail market, it may be picked up at the trustee’s sale for around $80,000. This would represent a buy price of approximately 25 cents on the dollar from the highs of just a few years ago.

I have spent the last several months working with a handful of investors and have made several purchases through the trustee's sale. If you are interested in finding good properties at the best prices in the hottest foreclosure market we have ever seen (and may ever see) please give me a call or shoot me an email and I can go over the details with you. Buying at the trustee's sale represents not only a great opportunity for the buy and hold investor to purchase properties for cash flow, but also represents the only viable opportunity for flip investors in Las Vegas to actually resell a property for a quick flip profit.

2009-11-03T13:48:00.001-08:00

Over the last year, many of my clients have asked me about the feasibility of short sales…both from a seller’s perspective, as a way out of an upside down property; and from a buyer’s perspective, as a way to acquire properties below market rate. Up until recently I have advised most of my clients away from short sales…as a buyer or as a seller. The reason was simple: lots of time invested, small chance of success. As a rule, since the housing bubble burst and the credit crunch began, banks have been overwhelmed with defaults and the departments in charge of evaluating and approving short sales have been notoriously slow and inefficient. Trying to negotiate a short sale with the bank often resulted in frustration for all parties involved with a very low success rate.

As a result, I have advised my investor clients to seek out REOs as the best buying opportunity here in Las Vegas. Time, however, are changing. My recent articles on the Las Vegas housing marketing have highlighting the dwindling supply of bank-owned REO properties available. Each month the demand for these REOs and the closings exceed the fresh supply of foreclosed homes coming from the banks. This has resulted in bidding wars across the Las Vegas valley as investors and primary residents eager to capitalize on the best real estate buying opportunity in decades flock to purchase the REOs that make their way on to the market. But with the percentage of homeowners behind on their mortgages still at all time highs, why is the number of foreclosures entering the market declining? The answer may be the increase in short sales.

Brian Wargo of the Las Vegas Sun recently wrote an article discussing this increase in short sales. In it, he quote Larry Murphy, president of the real estate monitoring firm SalesTraq, who says that of the 35,742 closings through the first three quarters of 2009 75% were foreclosures and only 10% were short sales. However, of the 11,249 contingent sales currently in place in Las Vegas, 71% are short sales and only 21% are REOs or foreclosure homes. This represents a dramatic shift in banking policy.

Murphy believes banks are becoming much more willing to consider short sales because they are finally realizing that short sales generate a higher sales price for the banks than REOs. Data supports this. The median price of homes sold through foreclosure is $116,900, while the median price for homes sold through short sales is $150,000.

The federal government has also adopted standardized rules for short sales, simplifying the process. This, combined with the pressure being exerted by the Obama administration to keep homeowners out of foreclosure, is creating a much higher approval rate for short sales. This, in turn, is keeping the flood of foreclosures that we had been expecting here in Las Vegas off the books and creating the progressively lower inventory monthly of bank-owned REO homes.

All-in-all, whether you are a seller looking to get out of an upside down situation or a buyer looking to capitalize on low home prices, now may be a great time to consider the short sale as an option.

To read the entire article in the Las Vegas Sun CLICK HERE

Latest Update-MGM Signature Towers

2009-10-27T11:56:00.000-07:00

It has been a little over three months since my last update on the MGM Signature Condos and I wanted to update my readers on the new developments that have been taking place. Those of you who are on my mailing list will have received a spread sheet I produced that details the profitability of a studio unit purchased recently for $150,000. This same unit was selling for $465,000 at its high three years ago. The spreadsheet shows that purchasing the studio unit for $150K, or roughly 32 cents on the dollar, would result in positive cash flow for the new owner.

In crunching the numbers on the MGM Condos, I have come across an interesting anomaly that I would like to share with you: The one bedroom units that are placed into the rental program have historically generated lower occupancy rates than the studios. Yet they cost about twice as much (the new lowest 1 bed sale has been $185,000), the HOA fees are nearly twice as high ($1000 vs. $500 for the studio), and they only rent for about $40 more per night. Potential investors should keep this in mind when considering studios vs. one bedroom units at the MGM Signature Towers. The one bedroom units are getting close to being a good deal for a buyer that is thinking of either living in it, renting it outside of the MGM rental program, or just holding it as a second home. But the one bedrooms are not as attractive as the studios from a pure investment perspective.

So far, the six lowest price studio sales in the entire project have been transactions that I have been able to negotiate for my clients. I was recently able to broker a deal in which one of my investors purchased a bulk bundle of four studio units at what amounted to $118,000 each. The Mountain View studio units are selling for the $120K-140K range and the strip view studios are now selling in the $140K to $180K range. The higher range would include the studios with a patio. The unit I discussed in the first paragraph that originally comped for $465K and recently sold for $150K, was a higher floor studio with a strip view and also a patio.

The inventory remains very light at this time. Currently, there are only 9 bank-owned foreclosures available in the MGM Signature Condos. 8 of them are studio units and one is a one bedroom condo. There are still quite a few short sales in various stages, but we are beginning to see a lot of short sales reverting back to the bank and becoming foreclosures as the short sale process is very slow and agents and banks are often unable to get them approved before the foreclosure happens.

Because of the light inventory of REOs and the difficulty in successfully negotiating short sales, I am beginning to look at the Trustees Sale in order to purchase affordable MGM Signature units for my investors. We are starting to see many studio units being sold at the Trustee Sale for around $120,000. MGM Signature Condos continue to be a great investment opportunity for those looking to acquire properties and utilize a buy and hold strategy. However, the really good news is that if you are looking to buy and flip, there is the opportunity to make $20,000-$50,000 per condo in a two month period through purchasing MGM Signature units at the Trustees Sale. If you are interested in this opportunity, please contact me for more details.

Mayor Goodman Speaks at Hugely Successful Meeting

2009-10-20T10:00:00.000-07:00

Over 100 people pre-paid to attend the October meeting of the Las Vegas Real Estate Insider Club in the conference room on the top floor of the Newport Lofts in downtown Las Vegas. Club founder Glenn Plantone welcomed Las Vegas mayor Oscar Goodman as the keynote speaker for this special event. Unfortunately, due to space constraints, event workers had to turn quite a few folks away at the door who had not pre-registered. After indulging several attendees looking for photo opportunities, Mayor Goodman took the floor around 7pm in front of a packed house. The mayor, famous for his career as the high-profile defense attorney for the Las Vegas mob, entertained the crowd with colorful stories of ex-clients and his penchant for the movie business. (If you ever meet Mayor Goodman, be sure to ask him about his requirement that all film producers looking to make a movie in Las Vegas create a part for Oscar in the movie...or they don't get a permit to make the film.) Mayor Goodman also discussed important developments occurring in the downtown Las Vegas area including the construction of the Lou Ruvo memorial brain center which is now underway. This institute, which will be managed by the Cleveland Clinic, will bring world class academic medicine to Las Vegas. Mayor Goodman stressed the importance of bringing academic medicine and superior health facilities to Las Vegas if the city is to continue its growth. The Mayor also touched on another important pre-requisite for a first rate American city: a professional sports team. According to Mayor Goodman, an arena and sports complex is in the works that will hopefully house an NBA basketball team within the next two to three years. Mayor Goodman expressed continued optimism over the possiblility of a realitively quick recovery for the Las Vegas housing market, stressing the assets that will help strengthen the local economy and encourage continued vitality in the market over the next several months and years.

After Mayor Goodman finished addressing the crowd, Glenn gave a short presentation detailing the current state of the Las Vegas housing market. He gave an in depth look at the number of sales in the preceeding five months vs. the number of foreclosures being added to inventory. Since the vast majority of sales closing in the Las Vegas valley continue to be REO or bank owned properties, Glenn pointed out that the number of SFRs currently available is not nearly so important to consider as the number of foreclosures being added to the market as REO listings on a monthly basis. Glenn's observation was that with the number of sales remaining consistently high since June, but the number of foreclosures steadily declining, we are actually facing a shortage situation in the market. There are more people looking to purchase low-priced REO homes than there are homes to sell them. Glenn estimates that the actual standing inventory of SFRs in Las Vegas currently represents only a two to three WEEK supply. This explains why investors and Realtors have faced multiple offer, bid-type situations as they attempt to purchase homes in the past several months. As REO inventory continues to decline, Glenn has found that a shift in direction is now required in order to provide his investor clients with the continued ability to purchase quality investment properties without having the price bid up to levels incompatible with strong cash flow. This shift in direction has led him to the Trustee Sales. By attending Trustee Sales on behalf of his clients, he has been able to successfully purchase properties for his clients at prices substantially below fair market value. If you are interested in purchasing properties utilizing the Trustee Sale, please contact Glenn at (702) 938-8888.

Glenn was followed by a presentation from Tamara Bostrom of Spiral Digital Media. Tamara discussed internet marketing for Web 3.0. As the internet has grown and consumers interaction with the web has increased to multiple events daily, it has become increasingly difficult for professionals to stand out on the web. Tamara discussed the need for Realtors, mortgage brokers, insurance agents and all other professionals to find a "niche" for themselves within this broader marketplace. She also discussed the success Spiral has created for their clients using content driven marketing. Content driven marketing is based around the concept of creating educational material within a client's niche and distributing this content as widely as possible on the web. This helps to establish the client as an expert within his or her field and results in potential customers coming to the client for help, rather than the client having to pursue potential customers. If you are interested in learning how Spiral Digital Marketing can use this unique internet marketing strategy to help generate leads for you, please contact them at (435) 652-9595.

Mike Lathigee closed the meeting by discussing how broader, macro-economic trends can affect local and national real estate markets. Mike's investment group, Alliance, specializes in identifying and acting on these trends that create buying and selling opportunities. Mike then presented a unique opportunity for all REIC club members to attend Investfest 2010 for only $1. This year, Investfest will host the youngest billionaire in Europe as well as many other speakers discussing how to generate wealth in real estate and other markets. If you are interested in attending Investfest 2010 for $1, please contact Glenn at gsplantone@gmail.com

Upcoming Nicaraguan Investment Conference

2009-10-02T14:38:00.000-07:00

My friend and colleague, Kevin Fleming recently shared with me a project he is involved with in Nicaragua. I have endorsed some of Kevin's deals in the past and this one looks like it has potential. Costa Rica and Panama have offered great appreciation over the last ten years and it looks like Nicaragua might be the next play in the Central American real estate market. I am including some details below. If you are interested, contact me and I will get you in touch with Kevin.

In celebration of the release of Phase 2 at Seaside Mariana Spa & Golf Resort and the amazing new investment-friendly progress within the country of Nicaragua, Grupo Mariana Family of Resorts is proud to host “Nicaraguan Abundance: Live, Invest and Grow,” December 3-6 at the Intercontinental Hotel in Managua, Nicaragua.

“Nicaraguan Abundance: Live, Invest and Grow” is a three-day business and culture immersion conference tailored for the savvy real estate investor. We will guide you through exactly what you need to know to successfully invest and do business in Nicaragua, allow ample time to network with colleagues, and then be your personal hosts for a day immersed in the sunshine and culture of the New Nicaragua.

You'll meet a select group of real estate professionals already living and working in the Nicaragua…You’ll check out great places to live…You'll get all of your questions answered about investment in Nicaragua…

• You learn about opportunities for the forward thinking investor
• You’ll learn more information about our Joint Venture Offerings
• You’ll find out how you can buy real estate in your IRA, 401 (K) or other
qualified retirement plans
• You’ll learn about title insurance and meet approved Nicaraguan Law Firms
from First American Title Insurance Company and Stewart Title Guarantee.
• You’ll meet members of the Grupo Mariana Development Team
• You'll learn how you can get involved in the country that many are calling
the next Costa Rica.
• You'll learn how you can participate in fascinating business opportunities
available in one of Central America's fastest growing countries.
• You'll discover how you can earn potentially stratospheric returns on
pristine, pure beachfront real estate.
• You'll see how you can enjoy a tropical lifestyle for far less than you'd
spend at home.
• And many other details...