If you walk into a Las Vegas casino, you can place a bet on the spin of a wheel. When it comes to buying a home, you should have a home buying guide instead of settling for a home buying gamble. With the median price of a single-family home still under $200,000, according to the Greater Las Vegas Association of Realtors (GLVAR), home buyers are eager to have a part in the action. Although GLVAR data also reports an increase in available inventory, the number of buyers who are actively looking still significantly outnumbers sellers. Here is a home buying guide for navigating this unique market so that you can hit these tables prepared instead of playing Las Vegas real estate roulette.
Before You Shop
If you are a cash buyer, you are not alone. These sales account for roughly half of all transactions around town in recent years. If you do not have the capital available for the full purchase, do not fret. Down payment assistance for first-time home buyers is available through Neighborhood Housing Services of Southern Nevada (NHSSN), and other income-based assistance programs are available through Housing for Nevada (HFN). Whatever your financing, you should have a preapproval in hand before you go home shopping.
Success also requires an appropriate amount of funds available for an earnest money deposit (generally about 1% of the total purchase price) and down payment (anywhere from as little as 3.5% for an FHA loan to 20% for a conventional mortgage with less-than-perfect credit). Now you are ready to go house hunting.
The Hunt for a Home
If nothing else, this home buying guide should give you a realistic perspective on the Las Vegas market. Expect that every home that you like will have multiple offers. Be prepared to write more than one offer. In other words, do not get totally stuck on just one property. Keep an open mind, and keep moving forward until you succeed in getting an offer accepted on a home that you truly desire. A qualified real estate professional will be able to help you navigate this maze successfully. Although more traditional sellers have entered the market now, real estate owned (REO) (i.e., bank-owned) and short sales still make up a sizable portion of what is available. Many bank-owned properties need some extra attention, and short sales can take additional time to clear the entire approval process with lien holders. For an average transaction you should plan on as much as one to two months of searching and writing offers, two days to three weeks for a seller’s response on an offer, and a 45- to 60-day escrow period.
Practical Considerations
Despite careful planning, your Las Vegas home buying experience will inevitably contain some of the town’s signature element: chance. This makes planning the transition from your current residence challenging. For renters, try to negotiate month-to-month status and ensure 30–45 days of additional lease time past your expected closing date. By doing this, if any issues arise that delay closing, you will not have the stress of having to move prematurely.
If you cannot arrive at this sort of arrangement, make sure to have a short-term living option in place. One issue may affect the progress of your transaction: Prices in Las Vegas are increasing, which can cause some appraisals for financed purchases to come in low. Working with experienced lenders and real estate agents will prove advantageous for getting through this and other hurdles on the way to owning your home.
Image Source: Flickr/Emre Ersahin
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