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Another rough year forecast for Las Vegas housing
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Ronda Churchill/Las Vegas Review-Journal
SalesTraq president and housing analyst Larry Murphy speaks Friday during the Crystal Ball seminar at Alexis Park. He predicted more pain the housing market. » Buy this photo
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LAS VEGAS REVIEW-JOURNAL
The Las Vegas real estate market is headed for another tough year, analyst Larry Murphy said Friday.
The president of research firm SalesTraq projected more foreclosures and as much as a 10 percent decrease in home values at his annual Crystal Ball seminar, which drew about 150 real estate professionals Friday at Alexis Park.
"I don't think we're there yet," Murphy answered when asked about a bottom in prices. "I think they will continue to sag or decline. Prices are still falling, but they're not free-falling. They may go down another 10 percent, but not as far as the past."
SalesTraq reported a median existing-home price of $104,900 in December, down 8.4 percent from the same month in the previous year. Prices are down more than 60 percent from their peak of $275,000 in 2007.
Murphy said he'd like to see banks approve more short sales, which now account for about 25 percent of Las Vegas home sales. Foreclosures still outnumber short sales 2-to-1 because lenders have more financial incentive to foreclose, he said.
With two-thirds of Las Vegas homeowners owing more than their homes are worth, the housing market remains depressed, Murphy said.
"Pretty certainly, I can tell you we're going to have another 100,000 foreclosures (over the next five years) because about one-fourth of our housing stock is still in default," he said.
The analyst had nothing positive to report on the new-home industry. New- home sales fell 30 percent to 3,793 in 2011, and new-home permits were down 15 percent to 3,740. Both are more than 80 percent below the peak.
The new-home market won't recover until the existing-home market does, and that's years away, Murphy said.
Why does he expect another 100,000 foreclosures in the next five years? Why are home prices still dropping?
"Because the same people in the same positions making the same policies and earning the same obscene salaries and profits continue to rape our economy," he said, rattling off a list of widely known investment bankers who walked away from the meltdown with big bonuses.
Nevada Bankers Association President and Chief Executive Officer Bill Uffelman wasn't at the seminar. Later, when briefed on Murphy's comments, he said everybody wants to blame the banks for the housing crisis, but lenders are no guiltier than anyone who signed off on documents, including the buyers.
"People got caught up in the frenzy that was Las Vegas," Uffelman said.
Bob Hamrick of Coldwell Banker Premier Realty heard Murphy's presentation and said he expects an increase in short sales due to Nevada's new law requiring lenders to provide an affidavit of authority to foreclose. That's going to push banks to approve more short sales where parties aren't forcing the issue of deed ownership, he said.
"Short sales will continue to be a big part of the market," Hamrick said.
About half of real estate-owned homes in Las Vegas are being purchased by investors, renovated and returned to the rental pool, Robert Ray of Nevada Title Co. said. And, he added, institutional investors and hedge funds are looking to buy single-family rental homes in bulk.
Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.
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The real estate agents were the cause of this mess. More than anyone they took advantage of novice home buyers. They talked the market up. They guided the pigeons and marks to their mortgage broker. They helped pick the appraiser that would justify their inflated over the top offer on a piece of garbage house.
Put them in jail!
On another note....
Would you rather have a $300,000 mortgage for a "starter" home built on top of your neighbors back in 2006 or a $115,000 mortgage for a real home today?
I prefer to keep my money in my pocket and not sending it to some bankster on Wall Street .... that's going to take part of that and give campaign contributions to Politicians in D.C. that waste your taxpayer dollars.
My home is paid off.... which gives me more money to spend in the local economy .... in locally owned businesses. Inflated home values and wanting to keep them artificially high with housing programs funded by taxpayer dollars is the big lie. Stop crying about it and look at the big picture for a truly sustainable economic recovery.
Stop Wasting taxpayer dollars on housing "programs" and get out of the way. The Bad Loans have to clear the system for a truly sustainable recovery to take place.
All of these programs for the past several years have only delayed the inevitable. The people living in their homes rent free for the past couple of year have had plenty of time to move on.
Dirty Harry,Sneaky Pelosi, Barney Rubble Franks, and the D-Rats caused the crash and blaming Bush as always. another 4 yrs of Bummer and we `ll be asking for foreign aid.
Cheer up Obummer and Dirty is talking about a 2 yr mortgage moratorium for under water folks, we should all quit paying mortgages and live free in your house for 2 yrs, just go out and buy new cars , boats, spend all income becouse Obummer will provide for you. a great Ghetto rich dude.
Hubble, HUBBLE, HUBBLE!! What are you doing with all this negativity?
The crashing Las Vegas home market was suppose to be our little secret, just like the sacred handshake at the Mason’s lodge or Mitt Romney’s magical Mormon underwear. Why are you telling everyone of this gloom and doom. I sat my old bottom on an uncomfortable seat at yesterday’s open house and no one even stopped by )-: On a side note, why is Nevada making it illegal for me to buy “bath salts”. My hemorrhoids are killing me and my warm bath is soothing?
@notbrightdemocrat Fannie & Freddie Cornerstone Of Collapse http://bit.ly/tnpiBN
You "Obama" haters blame everything on Obama...he was no where near the White House when Bush caused all this stuff to crumble on his way out....you guys are sooo funny....the bigotry is unrelentless....see you at the polls
We're creating... an ownership society in this country, where more Americans than ever will be able to open up their door where they live and say, welcome to my house, welcome to my piece of property. - President George W. Bush, October 2004...................Thus the housing bubble began to expand with no help yet from Fannie or Freddie. Alan Greenspan encouraged folks to take out exotic mortgages and nothing could stop the foolishness until prices collapsed under their own weight. All the fools in DC were in on fanning the flames, but don't lay the blame on one particular party,
Let's not forget Reagan free market/no regulation principles and what about Phil Graham and Gingrich signing off on letting banks get into speculative markets in late 90's. What about Republican appointed Alan Greenspan starting this all by allowing Rates too low for too long to make up for not helping out Bush Sr. more during S&L scam and recession of the early 90's? But no let's blame all this on Harry-that's what "in the closet Butch" Limbaugh tells you on the radio