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The Current Las Vegas Market
Single family residential (SFR) closings for October were down 3.9% from September but up 20% from October 2010. Total year-to-date closed units are up just over 10% from this time last year. Traditional and Short Sale closings picked up momentum over Bank Owned (REO) closings this month. Available REO listings continued to decline in October as the number of available REO listings now hovers around the 2750. Notice the trend chart below!
Available REO listings continue to decline even though we hear – almost on a daily basis – that Southern Nevada foreclosures are climbing. SalesTraq recently reported that 100,000 homes have been foreclosed upon between 2007 and 2011, representing 18% of all homes in the Greater Las Vegas area. However, there are plenty of forces at work to prevent the next four years from looking like the past. In addition to upcoming changes in HARP, HAMP, and HAFA – we have AB 284 which is dealing with the ROBO signing issues. In fact, October Notice of Defaults (NODs) have ground to a halt as a direct result of this legislation and now has quite a few folks in a panic about the future of foreclosures and short sales in Nevada. Here’s my response to that:
There are quite a number of individuals and groups using the passing of AB284 to create an atmosphere of fear regarding the impact. Yes, I believe that some homeowners may take advantage of the law – but not as many as some would like to think! First, we know that buyers and sellers make more emotional decisions rather than logical or rational ones. Most homeowners going through foreclosure or short sale proceedings just want it to be over so they can get their lives back and move on. So, I would bet on delinquent homeowners pursuing a short sale even without an NOD filed.
I trust that banks and perhaps other federal legislation will break through this impasse. Moreover, banks could get around this just by not paying county property taxes on delinquent mortgages as they now are. That would trigger tax foreclosures from the County. We are already seeing a few HOA’s foreclose on homes.
The bottom line is that I refuse to be alarmist. However, it would certainly make me add more traditional listings in my business model mix – just as a hedge!!
Must Watch Video on Foreclosures
“As more and more Americans face mortgage foreclosure, banks’ crucial ownership documents for the properties are often unclear and are sometimes even bogus . . . ” as reported by Scott Pelley. Click here to watch this shocking video clip from 60 MINUTES!
Market Price Changes
While the median and average prices remain soft with the median closed price of an SFR decreasing by 1.9% to $121,000. Yet, there were noticeable increases in closed sales prices in the Northwest, the South (Areas 301-303) and in Henderson.
What About Market Performance at Various Price Points?
I’ve included an additional page of statistics specific to the Greater Las Vegas behavior at different price points! Please take time to review page 6 of the report above and see how different the market behaves with closings above $250,000. Please consider this information when preparing your 2012 business plan.