Las Vegas Golf Courses - More Frugal with Water than Homeowners

Since Las Vegas is now a golf destination, I thought it was appropriate to post this letter to the editor of the Review Journal. The owners of Las Vegas homes have been complaining about the recent rate increases on water. For our Las Vegas golf course communities, this rate increase is even more expensive, raising HOA dues and golf membership dues.

To the editor:

After reading Jason Wagner's Friday letter to the editor, which criticized the Review-Journal's April 20 feature on the best 18 golf holes in Las Vegas for highlighting water waste by golf courses, I feel it is important to present the facts regarding water usage and Southern Nevada's golf courses.

First and foremost, the golf industry adds almost $1 billion each year to the Nevada economy.

Golf is an integral part of any resort destination throughout this country or abroad.

Golf courses use less than 8 percent of the valley's water, and that number is shrinking due to technological advances as well as superintendents' vigilant water management. Golf courses have removed 500 acres of turf, or the equivalent of five full-size courses, in the past few years, utilizing the Southern Nevada Water Authority's Water Smart programs. Golf courses are simply the most efficient water users in any water use category. We utilize the most advanced computerized control systems in combination with on-site weather stations to adjust our water usage 365 days a year. Water is golf courses' No. 1 cost of doing business, and therefore it is imperative that we manage our water efficiently.

Golf courses spend considerable staffing resources to manage this precious and expensive liquid. An average golf course will have two to four employees whose full-time job is to manage water. The rate increase recently passed by the Las Vegas Valley Water District, which will mean an increase to an average homeowner of a few dollars a month, can mean an additional $200,000 annually or more to a golf course's bottom line. With most other business costs skyrocketing as well, we cannot pass these increases onto our customers.

Golf courses are not green because they waste water. We fertilize correctly, we airify turf correctly, we chose the correct type of turf grass, we water correctly, and we have highly trained staff to identify and fix irrigation problem areas immediately. We apply wetting agents correctly. These are expensive chemicals that help the water to penetrate our poor desert soil, or help it hold on to moisture longer.

Golf course superintendents have worked closely with the Southern Nevada Water Authority to develop water budgets for golf courses to follow to reduce water usage during this period of drought, and have significantly reduced water use along with homeowners.

The golf course industry in Las Vegas is a critical part of our tourism machine, and we must not cause irreparable harm to a huge part of our already shaky economy without looking at the facts.
P.J. McGuire
LAS VEGAS
THE WRITER IS PRESIDENT OF THE SOUTHERN NEVADA GOLF COURSE SUPERINTENDENTS ASSOCIATION

To find out about how to purchase Las Vegas foreclosures in one of our beautiful golf course communities

How Does the Fed Rate Cut Affect Homebuying?

The Federal Reserve cut interest rates today for the seventh straight time since September of 2007. Many experts believe that the Fed is done cutting interest rates and will begin a new watch-and-wait policy. This new policy is due – in part – to the fact that the first Stimulus Act rebate checks are hitting millions of mailboxes this week. The Fed hopes this money will give a much needed boost to the national economy.

The cut took the federal funds rate, the key overnight rate at which banks loan money to one another, to 2%. It had been at 5.25% as recently as September, when the Fed started slashing rates in an effort to spur the economy and keep the nation out of recession.

Rich Yamarone, director of economic research at Argus Research, doesn't think rates will go any lower. He believes the Fed's next move will be to raise rates to combat building inflationary pressures. He indicated that the Fed might start raising rates as soon as December.

So how does this Fed cut affect the Las Vegas homes market?

Hopefully Las Vegans will take this to heart and start to plan accordingly whether they are planning to purchase a new home or if they are considering refinancing their existing one. The following points are important things to take into account:

1. Today's tougher housing market means there are some great buys to be had if you're looking to purchase. This is an especially friendly market for first-time home buyers.
2. The government has temporarily increased FHA loan limits in many areas across the US. These government-insured loans are not FICO-score driven and require little to no down payment. Here's the catch: these new limits expire at the end of the year, so you must act now.
3. You really don't want to play the waiting game if you are holding an adjustable rate mortgage (ARM). That's because there is nowhere for the rates to go but up from here, if we are truly at the end of the Fed's cutting cycle.

At the quarterly Crystal Ball Seminar last Thursday, consultant Steve Bottfeld with Market Solutions was bullish on the Las Vegas real estate market, and said the median price for new homes, including high-rise condos, will be up 8 percent to 10 percent in 2008. He predicted a window of opportunity to buy at the bottom of the market through October or November of this year and then saw prices stabilizing and starting to trend upward again.

Not only are there currently lots of deals on Las Vegas foreclosures and auctions, Larry Murphy of Salestaq identified 15 Las Vegas new homes subdivisions with a variety of models priced at less than $100 a square foot, led by Richmond American's 3,839-square-foot home at Vienna for $319,990, or $83.35 a foot.

Las Vegas Auction Scheduled for April 20th

On April 20th, Hudson and Marshall is having an auction of 200 Las Vegas foreclosures. Hudson & Marshall has auctioned more than 8,000 foreclosures on a national basis during a two year time period. Their client list is quite impressive; it includes Bank of America, Bank of New York, Chase Bank, Freddie Mac, Wells Fargo Bank, CitiFinancial and so many more. Since they are the premiere auction house, below we have detailed the steps in bidding and buying at a Hudson & Marshall Auction.

I would strongly suggest that you hire an agent who is an expert in the Las Vegas auction process before you start. The banks pay the agent's commissions and it literally costs you nothing, but could save you thousands. As well as helping you research the properties, the agent can help you determine a maximum bid price for each property you are interested in and make sure you don't get caught up in the buyer's frenzy!

Ways to bid on the properties:
Pre-sale/Resale form – prior to auction. This form will usually have a cut-off date several days prior to the auction.
Sealed bid form – could have a deadline.
Absentee bid form – must be submitted by 1:00 PM CST on the business day before the scheduled auction.
Attend Auction and bid – show up in person at the auction and register as a bidder.

Most of these properties are Las Vegas homes or condos previously listed on local MLS system. Note that once the properties are with the Auction house you cannot put an offer on the property through the bank or listing agents. If the properties are not sold at the Auction, Hudson & Marshall will accept post bids on the property for approximately 15 to 30 days after the auction before the properties are turned back over to the listing agent.

Prior to the Auction, you should preview the property. There are usually two open houses prior to the auction. It is the listing agent’s responsibility to have the homes opened to the public. I have, however, found in the past that not all of the homes are held open. In markets with lots of foreclosures, there are not enough agents working with the listing agent to be able to hold the homes open. Your buyer’s agent should be able to gain access to all of the properties before and after the open house if that is the case.

After you find the home you want to bid on, you should have the home inspected. These properties are as is/where is. If you are not paying cash and you are financing the home, you must remember that the lender may not finance based on the condition of the home. Hudson and Marshall are only accepting cash and conventional loans. FHA and VA will not be accepted.
When picking out more than one home, the homes are put on the Auction Block in accordance with the brochure. If you choose 2 or more homes, the home you really want may be one of the last ones listed in the brochure. Please be advised that if you bid on more than one home, and more than one bid is accepted that you have obligated yourself to purchase all of the homes on which bids have been accepted.

Your Las Vegas real estate agent should:
Make sure that the comparisons for similar Las Vegas homes is done and that you as the buyer are getting a good deal.
Make sure that the property does not have a rental cap if you are investing in the property to rent out later. It takes about 5 working days to get that information, as the agent will have to go through the Homeowner's Association. This is especially important on Las Vegas condos.
Make sure that you get a preliminary report or property report on the property. You need to make sure that the property is not in any litigation.
Discuss your offer price - you will have a start bid price and a maximum bid price. It is very important that you do not bid too high. You do not ever want to bid over 5% less than the listing price. (The listing price may change 2-3 days prior to the auction – the price usually drops) Any property that your agent knows that you are interested in will need to be researched the day before the auction.

Preparing for the Auction:
Find property.
View property.
Get full pre-approval for a Las Vegas mortgage loan (not a pre-qualification letter), or have proof of cash. If you are purchasing a condo in Las Vegas, you need to make sure there is no litigation - if there is you may only be able to do a cash purchase as most lenders will not finance them.
Have agent do their due diligence.
Come up with a starting bid and a maximum bid.
There is a 5% buyer’s premium that will have to be added to the offer price.
Example: Your accepted bid is $200,000 + buyer’s premium $10,000 = total purchase price of $210,000. This amount can be financed depending on lender.
There is a 5% Earnest Money Deposit (NOT TO BE MISTAKEN FOR THE BUYER’S PREMIUM) $2,500.00 cashier’s check, remainder of EMD in personal check.
Example: Total purchase price $210,000. $2,500.00 cashier’s check + $8,000.00 personal check = $10,500.00 total EMD.

Register at the auction:
You will need to register one hour before the Auction. You will need proper ID, social security number and a cashier’s check for $2,500.00 made out to yourself. You will show the cashier’s check, but you will only use the check if you have an accepted offer. The check is not rendered to the Auction House until you are in the contract room with an accepted high bid. This money will be used for part of your Earnest Deposit Monies. The remainder of the EMD can be in the form of a personal check. If you are purchasing under a business, you also will need to provide a Federal ID number.
When registering, you will check the box: “I have an agent”, and give them your agent’s business card. If the business card has been misplaced, give them your agent’s name and notify the agent. You will need your agent upon entering the contract room.
You will receive a bidder’s registration number; this number identifies you as an eligible buyer.
In the auction:
Find a seat. The seats are on a first come basis
There will be assistants to the Auctioneer in several sections of the room. They are called ring persons. Your agent should let them know which properties you are bidding on.

When your property is on the auction block, you will start bidding. There is a clause, in small print in the brochure that states the auction house and the sellers can bid against you. This is a very common clause with all auctions.

Once your offer has been accepted, a ring person will approach you for your bidder card. They will have you sign a card with your high bid. You will be told when to report to the contract room. (Do not go to the contract room without your agent.)

The process in the Contract Room:
You will be asked if you have previously viewed/inspected the property. The answer should be yes.
An employee of the auction and your Real Estate Agent will review the following:
Purchase and Sale Agreement
Exhibit B (Liquidated Damages Provision)
Exhibit C (Real Estate Disclosure Addendum and Release)
Exhibit D (Addendum to Contract of Sale)
Signed duties owed form
Waiver of Sellers real property disclosure (SRPD)
Once all documents are verified, you will submit Earnest Money Deposits checks.
You will have 30 days after the executed contract to close. If you do not close in this time period you will have to pay a per diem for each day after your original close date until you close, or you may lose your earnest deposit money.

After the contract room:
Executed contract means the seller (bank) has signed the purchase agreement.
Escrow is opened. (Earnest Money Deposit checks are cashed now.)
Title search begins.

If there is a Home Owners Association, you will need to purchase a resale packet. Your agent will notify you of the cost and order the resale packet. This fee will need to be paid prior to ordering and prices will vary.

Things that may delay closing: HOA dues, liens and other potential complications may hold up the closing date. This is common. In this case, the sellers will be required to pay off all demands (liens). Once these items are satisfied, the property will have a Free and Clear Title and you can close escrow.