LV house is a bargain for under $8 million

You've sat out the local housing market for months, just waiting for the perfect bargain.

Well, here's your chance to make an offer on a bank-owned golf course home in Summerlin that's shed more than 20 percent of its value.

The place is a steal at -- cough -- $7.95 million.

The Tournament Hills home qualifies as a deal because it's valued at $10 million, according to Bank Central & Trust Co., the Kentucky bank that owns it.

That value makes it Southern Nevada's most expensive bank-owned home, said listing agent Michael Mack, a former Las Vegas city councilman who brokers luxury home sales through Prudential Americana Group, REALTORS. Mack's research shows that the Palm Greens Court home might rank among the nation's most expensive bank-owned properties as well.

There's no central clearinghouse listing all the country's bank-owned properties, but a search of several Web sites didn't turn up any bank-owned properties with higher values than the Tournament Hills house. Local research firm SalesTraq reported a $7.7 million foreclosure sale of a 4,048-square-foot home in Rancho Bel Air in May. Foreclosureradar.com, which features only California listings, showed the highest-priced bank-owned homes in Los Angeles and San Francisco valued at $3.18 million and $2.5 million, respectively. A Wall Street Journal blog recently reported on a $19.5 million New York mansion in foreclosure, though the bank doesn't yet own that property.

Property value isn't the only element that makes the Tournament Hills home an unusual foreclosure case. In its ownership history, two boom-and-bust stories converge -- the first tale involving the bursting of the high-tech bubble in 2000-2001, and the second entailing today's deflating housing bubble.

Records at the Clark County assessor's office reveal the home once belonged to disgraced high-tech entrepreneur Charles E. Johnson Jr. Johnson bought the place in 1999 and owned it until Bank Central took it over in May 2006, just as the local housing market began to slow.

Johnson launched local e-commerce company PurchasePro in 1996. The dot-com enterprise enabled companies to hold online auctions for business supplies. PurchasePro went public on the Nasdaq exchange in September 1999; by 2001, after two stock offerings, Johnson was one of the country's wealthiest citizens on paper, owning more than $1 billion in PurchasePro stock at his company's peak. Forbes ranked Johnson No. 64 on its 2001 list of Tech's Highest Rollers.

The company's success bought Johnson his 10,692-square-foot Tournament Hills home. The two-story house, which sits on 1.24 acres, overlooks the fourth hole at TPC Summerlin. It contains seven bedrooms, 10 baths, marble floors, an elevator, a home theater and a gym. Also on-site: an eight-car garage, a basketball court, a putting range and a pool and spa. Neighbors include casino giant Sheldon Adelson.

Johnson's rarefied lifestyle began unraveling in 2001, after investment magazine Barron's ran a story criticizing PurchasePro's accounting practices. Johnson resigned as chairman and chief executive officer in May 2001. PurchasePro's stock price tumbled from a high of $343.75 a share in December 1999 to 8 cents a share in September 2002. That month, the company, which never turned a profit, went bankrupt.

Johnson and other PurchasePro executives were indicted in 2005 for back-dating and forging documents to improve revenue reports presented to investors. Authorities also said Johnson told conspirators to lie to government investigators looking into accounting improprieties. That case ended in a mistrial after Johnson gave his attorney, Preston Burton, an altered e-mail to use in Johnson's defense. A second trial in 2007 added an obstruction-of-justice charge as a result. U.S. District Judge Walter Kelley Jr. found Johnson guilty in May of securities fraud, conspiracy to commit securities fraud, witness tampering and obstruction of a court proceeding. Johnson, who's still in jail in Alexandria, Va., faces as many as 20 years in federal prison.

Bank Central officials said they'd comment only through Mack.

Yale Galanter, the attorney who assisted Johnson in his second trial, no longer represents Johnson. Galanter, who represents O.J. Simpson in his ongoing armed-robbery trial in Las Vegas, didn't return an e-mail seeking comment before press time.

As Johnson sits in the Big House awaiting his Oct. 16 sentencing, prospective homeowners can make a bid on his erstwhile big house.

If you can come up with a 20 percent down payment of $1.59 million, then a 30-year fixed mortgage at 7.24 percent interest will net you a monthly payment of $43,343. That approaches the $53,000 a year the average Las Vegas household earns annually.

It probably won't be your last chance to snap up a high-end repossession. A Review-Journal article reported Sunday that Southern Nevada has seen 17 bank-owned homes worth more than $1 million come on the market from January to September, compared with 18 properties in all of 2007. What's more, Mack knows of at least one prominent lender readying a new division to handle repossessions and short sales on homes worth more than $1 million.

Mack is marketing the Johnson home through magazines and Web sites, and he's scheduled an open house for brokers during the Justin Timberlake Shriners Hospitals for Children Open, a PGA Tour event at TPC Summerlin Oct. 13-19.

It's a small universe of buyers who can afford a $7.95 million home, so the property would take a while to sell even in a great economy. But at roughly $744 a square foot, said Mack, the home is affordable compared with the $1,000 or more per square foot some non-bank-owned properties still garner in other Summerlin golf communities.

"We're getting some bites (from potential buyers)," he said.

"Having it be bank-owned gets it some appeal right out of the gate. It is a deal compared with what you're seeing out there."

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or 702-380-4512.