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Jul. 10, 2008
Copyright © Las Vegas Review-Journal

HOUSING: Foreclosures push sales higher

Bank-owned homes account for 65 percent of sales in June

By HUBBLE SMITH
REVIEW-JOURNAL
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FORECLOSURE FILINGS GROW

WASHINGTON -- The number of homeowners stung by the rout in the U.S. housing market jumped last month as foreclosure filings grew by more than 50 percent compared with June a year ago, according to data being released today.

Nationwide, 252,363 homes received at least one foreclosure-related notice in June, up 53 percent from the same month last year, but down 3 percent from May, RealtyTrac Inc. said. One in every 501 U.S. households received a foreclosure filing last month.

Foreclosure filings increased from a year earlier in all but 11 states. Nevada, California, Arizona, Florida and Michigan continued to have the highest foreclosure rates.

Irvine, Calif.-based RealtyTrac monitors default notices, auction sale notices and bank repossessions. More than 71,000 properties were repossessed by lenders nationwide in June, the company said.

THE ASSOCIATED PRESS




Home sales in Las Vegas increased for the sixth straight month in June and inventory remained stable, the Greater Las Vegas Association of Realtors reported Wednesday.

Realtors sold 2,226 single-family homes in June, up 50.8 percent from the same month a year ago and up from 2,026 sales in May.

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    • "We're encouraged to see another significant increase in the number of homes sold here in the Las Vegas area," association president Patty Kelley said. "This is a good sign for our local housing market and for the Las Vegas economy overall."

    The number of homes listed for sale remained fairly steady, climbing 0.2 percent in June to 23,388 units. That's down 1.1 percent from June 2007.

    Frank Nason, president of Las Vegas-based Residential Resources, said the number of listings is stable, but has increased every week in recent months. However, recorded sales have increased at a faster rate over the past 60 days.

    That has reduced the supply of homes on the Multiple Listing Service from about 18 months at the beginning of the year to 13.7 months at the end of June. That number can change dramatically, based on closings, Nason said.

    Bank-owned properties are setting the pace in sales and helping establish the bottom in prices, he said. They account for about 65 percent of closings.

    "Banks are becoming more aggressive in pricing," Nason said. "In the beginning of the year, they weren't bending too much. They had a fixed price and they stood by it. Now they're trying to get them off their books. If you don't start moving short sales and bank-owned properties, you're going to end up with more foreclosures and the situation could get worse."

    The median home price in June was $225,000, a 4.9 percent slide from May and 26.2 percent decline from a year ago, according to the Realtors' association.

    The median price for 294 condos and townhomes sold in June was $137,500, down 1.4 percent from May and down 29.2 percent from a year ago. Available listings increased 1.7 percent during the month to 5,537 units, down 11.6 percent from a year ago.

    Distress sales of affluent Las Vegas real estate from bank foreclosures, short sales and builder closeouts are on the rise, Rob Jenson of Jenson Group said.

    More common among homes valued under $1 million, foreclosures are now hitting upscale neighborhoods around the valley as luxury homeowners are unable to cover ballooning mortgage payments, he said.

    Two out of every three closings in June were distress sales, and bank-owned homes are selling for 25 percent less than their previous listing price, Jenson said.

    "While overpriced homes do still persist in this overly saturated market, many sellers are entirely aware they are competing with distress sales and are being prudent with their pricing," he said. "And the investment-savvy are buying in. In today's volatile real estate market, one man's loss is truly another man's gain."

    A housing recovery may be on the horizon, according to a new study from the Joint Center for Housing Studies at Harvard University. The study finds immigration and other demographic trends will fuel housing demand over the next decade.

    "The good news is we still have a growing population," Nicolas Retsinas, director of the center and one of the study's authors, said in a CNNMoney.com article. "As long as you have more households, more people are going to need places to live."

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



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    s. Kobeachi wrote on July 15, 2008 12:22 PM: I just was thumbing through the comments, and came across a comment not to use Michael Moretti as a realtor. First I might say I was ref'd by personal friends and he was a delight and could not of made it any more effortless. I am an investor and will continue to use him and to "Glenn" you should be ashamed to slander someone's name. It shows you class!


    Bad Math wrote on July 15, 2008 09:01 AM: "Here's the deal, right now you can buy a house and rent it out and make positive cash flow immediately."

    You show me that cash flow analysis on a median priced house and I'll show you some really bad assumptions like no vacancies, no repairs/maintenance, no advertising costs, etc. Not to mention all the fun that is landlording in Vegas! ;-)


    to cas127 wrote on July 12, 2008 11:01 AM: The sales are up 50% from a year ago, and have been increasing for 6 straight months. That is news. As for dead cat bounces, that is a tired phrase almost as old and trite as "catching a falling knife."

    Here's the deal, right now you can buy a house and rent it out and make positive cash flow immediately. Just as decreasing sales said that home prices would eventually fall in Vegas (even though prices continued to climb slightly with decreasing sales for a while here in Vegas and remained steady for about a year before the big drop off), increasing volume in sales portends price inceases (even though we may still see falling prices at a slight rate).

    Eventually, this will all turn around. We will return to 2006 prices someday.


    Glenn wrote on July 11, 2008 08:51 AM: Please do not purchase a home using Michael Moretti of Coldwell Banker as your Realtor.


    CAS127 wrote on July 10, 2008 04:46 PM: "one man's loss is truly another man's gain"

    Yep, the buyers who buy *after* the upcoming Alt-A axe falls and creams the "distressed investors" who have bought on the current dead cat bounce.


    CAS127 wrote on July 10, 2008 04:43 PM: "Home sales in Las Vegas increased for the sixth straight month in June"

    Wow! Newsflash!

    Homes sales higher in peak month of June than trough month of January!

    Alert the dingbat media!

    Anybody ever here of sales seasonality there at the rah-rah RJ?


    Dan Strauss wrote on July 10, 2008 02:43 PM: 'would you bring your business here with the uneducated'??? Well, Ford, GM, Microsoft, etc... (the list is huge) have transferred an enormous part of their business overseas.
    There is plenty of room for business in and around Las Vegas but not if you want to pay the BLM prices for what they have been asking for.
    I have to laugh about not having gaming, not having large suburbs, because that is what you'll have. Go live in Carson City or Kingman, AZ if you want that.
    Tourists drive this city, but that doesn't mean they always have to. The local government should be providing HUGE INCENTIVES for business to move in.
    We just need to quit thinking the goverment owes us everything because we live here. Get a job, have the spouse or significant other get a job, send your kids to school, spend time with the kids and find out what they learn in school, etc... So many people want to blame everyone else. The problem is people that need to hear this, will never read this. Bad situation and only getting worse.


    lv h8r wrote on July 10, 2008 12:22 PM: Pete..."pitiful comments" ????.....No, here's a pitiful comment "I prefer my ho's under-educated"... do you need to hang out with under-educated people to make yourself feel smart?


    pete wrote on July 10, 2008 11:57 AM: Why do you guys want to educate your little girls to grow up and become strippers? I prefer my ho's under-educated and Vegas is the perfect environment. I'll be buying my first of many investment properties there in the next few months and hope to have my own zip code. I won’t be waiting for any municipal services to improve my way of life, that's an oxymoron, and you'll be left disappointed. I also won’t raise my kids there either, but would certainly move there as soon as they turn 18 and go away to college (hopefully not UNLV!). Don't complain about investors buying up your neighbor's homes; the alternative is what...no one buy them? The truth is there is a glut of supply and little active demand (high sideline demand: tell me who doesn't want to buy a house for half of what it costs to build?). Pitiful comments. Sucks to have bought in 2006.


    J wrote on July 10, 2008 10:32 AM: Las Vegas needs a DECREASE in population and a DECREASE in the carpetbaggers who came here to leech from our prosperity. A smaller Las Vegas is a better Las Vegas - tear down those suburbs!


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