SLOW CLOSINGS ON HI-RISES IN LAS VEGAS

Selling high-rise condominiums in Las Vegas and closing escrow on them are separate challenges in today’s economy.

Of 2,558 units that opened escrow this year in projects of 50 or more units, 77 percent are still in escrow. Of 3,095 units in this category that opened escrow in 2007, a third are still in escrow.

Trump International has effectively sold out because almost all units are held with deposits by prospective owners, brokers say. There are fewer than 20 percent closed of the 1,282 units since the escrow process began in February

Turnberry Towers, which began closing units in July 2007, has closed escrow on roughly 84 percent of units. The second tower, where closings began in April, has closed on about 17 percent of units. 100 of the 599 condo-hotel units at Palms Place were purchased outright with cash.

Mortgage lenders nationwide are requiring larger down payments, which could mean forking over an extra $50,000 or $100,000. And nervous banks are attempting to reconcile appraisals lower than what the properties were worth earlier appraisals, when the buyers signed their pre-slump sales contracts.

The slowdown in real estate sales has been magnified in Las Vegas, where condo-building hype and official reports suggested a far greater boom than what occurred.

As the condo-building craze started when 90,000 condo units were announced — and most never moved beyond news releases and Web sites. Some developers opened sales offices and sold units to try to secure financing. Most that received financing were canceled when banks tightened credit requirements.

The Las Vegas Valley has roughly 10,000 condo and condo-hotel units in projects with more than 50 units. An additional 8,100 are under construction or nearly complete, with more than 6,200 of those units destined for the Strip.

There will be a decline in new high-rise construction on or near the Strip because land, labor and construction prices continue to rise during this slump. Of the 15 existing and under-construction high-rise residential towers on the Strip in the next few years, Turnberry will have built nine.

For more information on the Las Vegas condo market contact Stuart Sheinfeld www.elitevegasrealestate.com