Parade of Homes features lower-priced luxury - Business

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May. 02, 2009
Copyright © Las Vegas Review-Journal

Parade of Homes features lower-priced luxury

By HUBBLE SMITH
LAS VEGAS REVIEW-JOURNAL

A sitting area of a Vantage Point by Sunwest home overlooking the Las Vegas Valley is shown Thursday. The Ridges home is featured in the 2009 Parade of Homes.
Photo by Jerry Henkel/Review-Journal

It may not be the best of times to show off luxury mansions in Las Vegas, considering the down housing market and an economic recession that has forced the wealthiest of the wealthy to reconsider where they're throwing their money.

During the 18 months of preparation for the 2009 Parade of Homes, the "perfect storm" swept through Las Vegas, destroying home values at every price segment and siphoning available credit, said Lisa Hester, executive producer of the tour.

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"Who moved my cheese?" she said. "It's a different setting in Vegas. When you're in an economy like this, adjustments happen that have to happen."

After holding up well into early 2008, the high-end market hit the skids like the rest of the real estate market, said Kenneth Lowman, broker and owner of Luxury Homes of Las Vegas.

Prices have declined 25 percent to 45 percent, depending on the neighborhood, quality of construction, age and amenities, he said. He knows of a 13,000-square-foot home inside three gates that was originally listed for $14 million and can now be bought for $6.5 million.

It's not uncommon to see $1 million price reductions in many luxury communities, he said.

Million-dollar mansions on the Parade of Homes are unattainable for most buyers, but they can be seen as sort of a "local stimulus package" for home design and decor in Las Vegas, Hester said.

People will see synthetic turf and ask how it's maintained. Custom lighting may catch their eye, or a particular stone pattern. One home has a kitchen with a glass floor, glass table and glass chairs sitting above the swimming pool.

"When people see these things and are inspired and motivated, they start digging in the couch for quarters to do some little remodel and we're starting to see a lot of things we talked about," Hester said.

The 2009 Parade of Homes, which showcases 12 homes in exclusive neighborhoods such as Red Rock Country Club, MacDonald Highlands and The Ridges, continues through Sunday and next weekend. Tickets are $25 and can be purchased online at www.LVParadeofHomes.com.

One of the Parade homes, Marquis by Las Vegas-based Blue Heron, was featured as the New American Home at the 2009 International Builders Show in January.

Built on an infill parcel near Tomiyasu Lane and Sunset Road, the 9,000-square-foot home breaks away from the "vernacular architecture" seen in most master-planned communities in Las Vegas, said Tyler Jones, president of Blue Heron.

"We can't keep copying these other places and think we can have an identity," the native Las Vegan said.

The $4.5 million Marquis home is a good example of the "green" building movement with its insulated concrete forms, tankless water heater, water-smart turf and photovoltaic system that produces more electricity than the home uses during certain periods of the day.

"We've got to think long term and what comes next, the zero carbon footprint," Jones said. "We've got to educate people about renewable energy. This isn't a fad. This is long term. The builders know it's real. They know the demand is there."

Realtor Rob Jenson said the contemporary look of the $7.5 million Acero home by Stacy Slade at Red Rock Country Club is "almost industrial" in the use of concrete and gray tones. Floor-to-ceiling glass wraps around the upstairs game room and gives it the feel of a high-rise penthouse, he said.

"It's unbelievable. In spite of current market conditions, they continue to press the envelope," Jenson said.

The $10 million River Runs Thru by Sunridge Builders at MacDonald Highlands features a babbling brook in the courtyard entrance and a three-story waterfall in the grand foyer.

Luxury home development stimulates the economy by providing hundreds of jobs for trade contractors, laborers and suppliers, said Dan Coletti, president of Sun West Custom Homes.

Lowman said several factors are causing luxury home prices to fall.

Buyers are often business owners and executives whose own businesses are feeling the pinch of the recession. Stock market declines took away much of their paper wealth and now limits their buying power, he said.

Lack of available jumbo financing is another factor. About 80 percent of luxury transactions are going to all-cash buyers.

"It's just not that easy to get financed anymore, for anybody," Lowman said.

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.

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Please enter your name Name: Please enter your email Email: Please enter a comment COMMENTS : (word count limit is 300) You have reached the maximum number of words allowed Current Word Count: Note: Comments made by reporters and editors of the Las Vegas Review-Journal are presented with a yellow background. George wrote on May 03, 2009 01:32 AM: David is right. Unfortunately most people who purchased a home in Las Vegas did so with the intent to stay hear and live. The emotional factor over road the intelligence good financial sense factor. There is no other choice then to go belly up (chapter 7) to get out of this mess unless the banks start to play ball. If they didn't receive bailout money they just might have but our corrupt government did just this. Bush or Obama, it really doesn't make any difference. Our choices are limited to bankruptcy. david wrote on May 02, 2009 05:47 PM: Yes, I'm glad I sold out 3 of my Vegas properties in the early 2000-2003 period. Right, I was a little early, but looking back it was the right move as I scored huge profits. I don't have much sympathy for those who subsequently purchased homes and made the decision to relocate to Vegas. This is the free market enterprise system. They didn't do their homework and like so many stock investors, this is their loss and that is the basis of capitalism. Idiots buy at the top and the winners sell at or near the top and the losers hold on until they are bankrupt. Lately, I am looking to re-enter the market on a small scale, though I think it has somewhat more to fall. My own take is that Vegas will never rise to the previous level of home prices, though prices should stabilize and rise very incrementally. I know I will never make the profits I did earlier, but there are so many losers in Vegas, it might be worth a small investment of a couple of hundred thousand or so. When I was lived in Vegas for over two decades, it never seemed to amaze me how so many experts (people like Dennis Smith) and their enablers at the RJ, Sun, and UNLV kept the bubble alive. I never believed these shills, and thank God I didn't. Otherwise, I would be way under water. Those who thing Vegas will come back are also idiots. It may stabilize, hold its own, and slowly increase in population and value in a year or so, but there will be more opportunities elsewhere. Don Best wrote on May 02, 2009 04:33 PM: Fully agree with Tank. Have a friend stuck in Mountain's Edge. He's way upside down. He spoke to the bank, and they laughed at him. So now he hasn't paid the mortgage since January, and now they're starting to talk. Remember, they're not going to sue you, since with over 25,000 homes in peril here in the Valley, there's no way they'll be able to afford paying the ambulance chasers to sue. Plus the IRS could care less-there's a law that says they can't go after the difference between the balance and the "auction" price. Plus last time I looked, we've closed all the debtor's prisons. Do it... Tank wrote on May 02, 2009 04:07 PM: There will be another 20% fall in Las Vegas home values over the next year. If your in a mortgage and your anywhere near being 100 thousand upside down then stop paying rent to the banks. The banks will do nothing for you. File for Chapter 7 and save your money. You will get to live in the home for another 6 months rent free. Then take that money and pay cash for a repo or rent at about 600 dollars less then what you are paying now. Obama Depression of 2009, 2010, 2011, 2012 wrote on May 02, 2009 10:20 AM: The other shoe is still hanging waiting to drop. The commercial market will begin defaulting and push the stock market down to about the 3,000 level. The private housing market was just the beginning. And of course the nitwits in the WH and Congresman have prolonged any recovery by massive debt expansion that will keep this country down for years to come. Obama Depression will last at least four years, and hopefully, we can get rid of this moron. fred t wrote on May 02, 2009 09:05 AM: Why buy new? There are huge numbers of nice repos in Anthem at the top of the ridge. Beautiful views of the Strip and the Valley. Remember that Cali Lady who bought 7 of them? I'm sure she defaulted-a Cali investor thing. Go to realtytrac.com, and check them out. Common Sense wrote on May 02, 2009 08:41 AM: "nobody can say a 9000 square foot house is environmentally responsible." Al Gore can. His spread is 15 or 20 thousand s.f. He can also fly around the world in a private jet and ride around in SUVs, because he tells everyone ELSE not to do that. socialist wrote on May 02, 2009 07:59 AM: Today we can listen to every other post tell us how to live, what we need and don`t need. I liberal always knows what's BEST. rob in lv wrote on May 02, 2009 07:57 AM: Actually, the ticket price for the parade of soon to be foreclosures should be -$25. They should pay us for attending. JR wrote on May 02, 2009 07:44 AM: Greed and egotism are killing the planet. I don't care if it is built from yak hair harvested by villagers with tweezers, nobody can say a 9000 square foot house is environmentally responsible. Even worse, many of the people who own these houses already have homes in other places. Even if they produce all their own power, these building materials had to come from somewhere. A three story waterfall? In a drought? Totally irresponsible on the part of the designers and builders. Not just the water, either. It takes a bunch of power to push water 30 feet up in the air.