Foreclosures continue to hold down Las Vegas home prices
11 May 2012
The latest residential real estate data show a good-news, bad-news scenario continuing for Las Vegas.
The bad news is that among 146 of the largest housing markets in the United States, Las Vegas was one of 72 markets to see prices decline in the first quarter from a year earlier.
The median price was down 4.8 percent, from $128,300 to $122,100.
That’s according to the National Association of Realtors, which this week said in a report that despite the declines in 72 markets, there are signs of strength in real estate prices nationwide.
That’s because in the just-concluded first quarter, 74 markets posted price increases, up from just 29 markets with increases in the fourth quarter.
While first-quarter prices in Las Vegas were down on a year-over-basis, they’ve increased on a month-to-month basis for three consecutive months ending in April, according to the Greater Las Vegas Association of Realtors.
Even with the latest increase, to a median of $127,900, Las Vegas homes are selling for bargain prices to those who have cash or can obtain a mortgage.
And that’s the good news.
“On a square-foot basis, we’re probably one of the best deals in the United States right now,’’ GLVAR President Kolleen Kelley said in an interview Thursday.
Prices have been rising amid tighter supplies linked to a slowdown in banks putting foreclosures on the market as they try to comply with new foreclosure-documentation standards.
Realtors also have noticed an increase in banks agreeing to short sales, in which homes are sold for less than their mortgage debt, Kelley said.
Weighing all these factors, Kelley isn’t predicting any dramatic price increases anytime soon.
“We still have a lot of foreclosures to work through,” Kelley said.
Las Vegas and Nevada will likely see elevated foreclosure rates for some time, a new report from credit data collector TransUnion says.
The company this week said that in the first quarter, Nevada maintained its No. 2 spot behind Florida on the list of states with the highest mortgage loan delinquency rates.
Nevada came in at 11.16 percent of its home mortgages delinquent, or at least 60 days past due, an improvement from the year-ago quarter’s rate of 14.19 percent.
Still, Nevada’s rate in the first quarter of this year was well ahead of the U.S. rate of 5.78 percent.
Nevada’s problem with mortgage delinquencies and resulting foreclosures swelled during the recession, which pushed unemployment up to levels that remain elevated at 12 percent.
In another development, Atlanta-based homebuilder Beazer Homes Inc. announced it created a real estate investment trust (REIT) to buy, refurbish and lease recently-constructed homes.
The new business, called Beazer Pre-Owned Rental Homes Inc. (BPRH), is launching with the contribution of nearly 200 such homes in Phoenix and Las Vegas to the REIT.
Beazer said this contribution, valued at $20 million, is part of $85 million raised for the venture so far.
“BPRH intends to become a leader in the single-family rental homes business and is one of the first REITs focused exclusively on the single-family home rental market,” the company said in a statement.
Kelley, at the GLVAR, said the trend of investors acquiring foreclosures and other homes to rent out isn’t a bad thing — even if it means some of those homes won’t be listed for sale in the short term.
“It’s better to have the water moving than to leave it stagnant,” she said.
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