Las Vegas home prices continue to slip, index shows
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A construction worker is shown in this file photo from early 2008, when Las Vegas was starting to feel the effects of the Great Recession.
Tuesday
26 April 2011
8:18 a.m.
Las Vegas-area home prices fell again in February -- and remain below 2000 levels -- as measured by the Standard & Poor’s/Case-Shiller Home Price Indices.
Prices locally fell 1 percent from January and were down 5 percent on a year-over-year basis, S&P reported today.
For the 20 big U.S. cities tracked in the report, prices on average declined 1.1 percent in February from January and were down 3.3 percent from February 2010.
On a seasonally-adjusted basis, Las Vegas prices fell 0.3 percent in February from January vs. an average decline of 0.2 percent for the cities tracked.
"From their 2006/2007 peaks, 10 metropolitan statistical areas posted new index level lows for the third consecutive month in February 2011. These are Atlanta, Charlotte, Chicago, Las Vegas, Miami, New York, Phoenix, Portland (Ore.), Seattle and Tampa," S&P said in today’s report.
"There is very little, if any, good news about housing. Prices continue to weaken, trends in sales and construction are disappointing," David Blitzer, chairman of the Index Committee at S&P Indices, said in a statement. "Recent data on existing-home sales, housing starts, foreclosure activity and employment confirm that we are still in a slow recovery. Existing home sales and housing starts rose in March, but remain close to recent lows. Foreclosure activity showed decreases in mortgage delinquencies in the fourth quarter of 2010, but are still close to historic highs."
In a market swelled by foreclosures and high unemployment (13.3 percent), today’s Las Vegas-area housing numbers confirm recent weakness in the existing home market reported by the Greater Las Vegas Association of Realtors.
On April 8 the Realtors reported that for March, the median single-family home price was $125,950, down 1.6 percent from $128,000 in February. That’s down 7.4 percent from March 2010.
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You can expect houses in Las Vegas to go down another 5% until it bottoms. The banks haven't released thousands of homes that are foreclosed or short sales. The thing that I don't understand is why the builders keep building new homes?
I'm not a well paid consultant that always seems to get things wrong (yet is still counted on by the media for story quotes), but in my opinion prices here in LV will continue to slide for a while. There are just too many people walking away from their homes and mortgages, due to being so far upside down, for real traction to be gained any time soon.
I know a ton of people walking away from mortgages. They are people that make enough money to cover their mortgage, but don't want to pay for a home that's worth less than half what they owe. Judge it all you want, I know I do, but it's something real that's happening and happening a lot.
All of these people that are bailing on homes can no longer qualify for financing, even though they could afford to cover the loans, if they got them. This reality will result in a few more price decreasing years to clear out the inventory - again snapped up by the out of town investors that jacked up our market to begin with. Rather than flippers, these people are now landlords.
The statement that: "The houses are worth less than the materials to build them" is silly. What is a used two by four with a bunch of nails in it worth? or a chunk of concrete? Or used wallboard anyone? The houses are decaying and the fix-up will not be worth spending the money. There is a point of no return. and we have reached it. Detroitism has set in.
How can this be a "slow recovery" when prices are still going down? If price were going up by 1/2% then that would be a slow recovery. We haven't seen bottom yet and it could be another year or two before we do.
The only reason I have not packed up and left NYC for Las Vegas is because I KNOW the price of housing is going to fall even further. I was out there in January and could not believe people actually paid that much for those homes.
Though the homes I looked at were nice I could not see paying $175k plus for them. That line of reasoning is also why I never considered buying in the NYC area.
It is hard to argue with people who paid top dollar for a home that they know will never get back up to the price they paid for it. Personally, I feel sorry for them and Las Vegas residents as a whole who did pay premium for their homes. The employment picture is NOT good, regardless of where you are. There are also people out there who are hard working and had no idea they would on day lose the job they had and had to accept another one that did not pay a living wage.
There is no crystal ball to see into the future. It was all a roll of the dice and many rolled craps in their search for the American dream. But as they say, one man's loss is MY gain. Keep on falling, Las Vegas. I can wait it out.
And they are going to drop further. They are only held artificially high by a government that doesn't want to face the ending of the warfare-welfare state or the message a truly free market will give. Even today's low and dropping prices are prevented from falling off the cliff by government welfare: ridiculously low (by international standards) down payments, government loans, and give-aways to the banks, which are all either not real banks or are legally bankrupt.
The only things the US produces are wars, armaments, and worthless currency (since 1971), which are all things foreigners want less and less. The market will prevail over the bureaucrats and vote-seeking politicians. Prices will drop another 50% and we will be holding currency that no one else will accept (i.e., is truly worthless) unless the government faces reality soon. Ed Uehling