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The Las Vegas Housing Market

AIR DATE: January 24, 2011

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The news about home prices in Las Vegas just keeps going from bad to worse. Or so it seems. But are there any places to buy? Do home prices have any chance of recovering in our life-time? Why have the mortgage modification and neighborhood assistance programs made so little difference? Is it ever the right time to take the hit and move on to greener pastures? Experts from the real estate industry will try to assess what the real outlook for housing in the Las Vegas Valley.

GUESTS
Ken LoBene, Dir, Las Vegas Field Office of HUD
Paul Bell, Pres, Greater Las Vegas Association of Realtors
Scott Dickensheets, columnist, LV SUN
Michelle Johnson, Pres and CEO, Consumer Credit Counselling of Southern Nevada and Utah

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LATEST COMMENTS

Just a little bitter, I have lived in my home ...
-Jim

Two of my current clients were given "loan ...
-alda

Why are you tolerating these people saying, ...
-ed

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COMMENTS:

Just a little bitter, I have lived in my home for the past 11 years. I applied for a refinance back in 2007 due to the low interest rate environment only to be told my home was worth less than my original loan, I explained I did not want principal forgiven just a market rate loan which when completed would make my home more affordable. I was denied by my bank Chase.

Fast forward 2 years now my income had dropped by 50% and my home was no longer affordable so I applied with Making homes affordable and received pre-approval from a non profit that I was told to contact. I was told that Chase would receive the same notice alerting them that I was pre approved. Over the coarse of the next year I supplied the requested documentation 8 times with proof of delivery of over 1388 pages of documents. Still I am being told that nothing was received and foreclosure proceedings have began. I have lost total confidence that anything I was told by making homes affordable and my bank and the Non profit made any difference to anything I was trying to accomplish. I have lost any desire to stay here in Las Vegas or further build my practice or ever spend here again. Thank you NPR for this forum.

Jim –Jan 24, 2011 12:22:55 PM

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Two of my current clients were given "loan modifications" One was told that to accept the modification, she must return the signed docs with the new payment by 7/24/09. She did. One West Bank sold her home on 7/20/09. When she sued for wrongful foreclosure,the attorney for the bank pointed out the language on the second page: (Paraphrased): There is no contract for modification until a representative from the bank signs and returns the contract. Of course they received my client's signed docs and money on 7/23/09 but as far as they are concernd they did not breach any contract because noone from the bank had signed and returned the docs to my client. This there was no contract to breach. Bank of America did the same thing to another client. After she paid the trial mod. sum for more than a year, BOA denied her permanent modification. Reason: she did not qualify for a permanent mod. No explanation as to why. Why is the same moral imperative that is being foisted on homeowners to guilt them into staying in underwater homes not being equally applied to banks/lenders? Is "morality" a one way street?

alda –Jan 24, 2011 10:17:28 AM

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Why are you tolerating these people saying, that the market is so great? NOT IF PRICES ARE STILL GOING DOWN! And they will go down, because the entire market is based on subsidies from the federal government and these WILL END. To make things worse, the incompetent handling of this crisis by local governments is so astoundingly incompetent, that they are compounding whatever problems the banksters, rating agencies, appraisers, buyers, and government have already created.

ed –Jan 24, 2011 10:04:57 AM

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Over two years ago I predicted that the housing situation would create an economic La Brea Tar pit trapping people in their homes and causing a kind of economic paralysis because middle and upper middle class professionals could not move to where the jobs are. I even proposed a FREE MARKET solution. It has been completely ignored. Check it out here www.dnusbaum.com/fix.html

Doug Nusbaum –Jan 24, 2011 10:03:20 AM

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The comment that the realtor gives the buyer what he/she wants is nonsense.I am an attorney. When I bought a home some time ago, I had excellent credit and a good income. My "friendly" realtor encouraged me to enter into a morgage that had a negative amoritization. (Didn't know what that meant then) After ten years in the home I owed more than my original purchase price. I have a client now whose realtor (her tax preparer)knew she was not making the "stated" income, but encouraged her to state an income that was substantially higher than she was making just so that this client could refinance hef home just so that the realtor could make a larger commission.

alda –Jan 24, 2011 10:02:01 AM

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I am a local Realtor in Vegas. I have speicialized in Short Sales the last 5 years. As a person that is in the trenches. If there as an over all unity for homeowners to push law makers to force the Banks to allow Bankruptcy Judges to perform Principal Reductions. By adjusting the mortgage to reflect currently value, a larger number of homeowners could , and would be able to retain their homes. Loan mods are no help what so ever. They are just a mere band aid to the problem. The Banks know all this to well. 90% of all loan mods redefault. Pinicipla reduction could solve most of the foreclosure problem. Obama tried to push the law for principal reduction but was meet with too much oppossition from the banking industry. We need group together on this.

Carlos Aguilar –Jan 24, 2011 10:01:24 AM

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As we discuss the moral implications we mis-state or mis-frame the question. Its not about adhering to an obligation to pay at all costs, but it properly framed as an obligation to adhere to the terms of the contract. The contract provides for regular payments, but it also provides for what happens if those payments stop. Foreclosure is the remedy for the banks if someone walks away and the homeowner who walks away suffers exactly what he bargained for. He also suffers consequences in terms of his credit. Homeowners havent defrauded or gotten away with anything. As well, interest is collected by the lender to account for these costs and the banks, particularly those with insurance, still get paid.

Keith –Jan 24, 2011 10:00:28 AM

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Many Realtors have an agenda to push homes that they have listed, creating a serious issue of conflict. They do not simply follow the direction of the buyer. In 1989 and 1990 I worked with the FFIEC and the RTC to establish rules and an oversight agency intended to avoid the issues that brought about much of the current housing crisis. When I spoke with the Appraisal Subcommittee last year, they told me they had gone from over 1,000 actions per year against fraud in the mid-1990's to less than 10. Congress had cut their budget and staffing. This was one very useful line of defense that was removed by deregulation advocates.

joe –Jan 24, 2011 09:59:31 AM

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Didn't this Mr. Bell who said earlier that realtors had no responsibility in the crisis and he says that he follows the orders of his clients, also give the typical half-story sales pitch on your program that "people should buy immediately because the prices are so great" (paraphrase). He even cited a study that Las Vegas is the most underpriced market. So what if its underpriced if the prices are going to go lower still as everyone is expecting. THE REAL ESTATE INDUSTRY IS HUGELY RESPONSIBLE.

Ed –Jan 24, 2011 09:54:00 AM

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My next to the last sentence should have a ? at the end. It would be better stated as:

So what if the market is "underpriced" when the prices are still going lower? By definition houses are OVERPRICED, because the price is still too high!

ED –Jan 24, 2011 09:58:17 AM

THe difficult part, is borrowers seem to be expected to be honest and the banks do not. The money set aside for refinancing is not being used, banks do not allow refinancing. Mortages have been bundled and sold. No one knows who actually owns the mortages, so no one knows who to ask to re-negiotiate the loans. Our banks are now nothing more than collection agents without any control of the actual loans, and will not admit that they can not re-negiotiate loans they do not own. The future question is what will replace banks. People will continue to move, change homes, and live somewhere. The Mortage process may be fatally damaged by the widespread deception experienced by many.

timothy vanduzer –Jan 24, 2011 09:42:04 AM

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What is the general consensus among your guests regarding mortgage modification, specifically, is the modification process, i.e. time line, application procedure, banks' willingness to streamline, expected to improve to the point of being a viable option anytime soon?

Steve –Jan 24, 2011 09:31:10 AM

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When are the banks and financial institutions going to start taking some responsibility for the losses in valuations? As I track homeowner situations it seems that there are few if any loan modifications that reduce principal. Why should the financial burden be morally put on the homeowner when the businesses aren't willing to short sell or reduce principal and share the loss? If your talking morality the burden would be shared. Charlie has a point but I believe if the burden (losses) were split everyone could recover.

Mark –Jan 24, 2011 09:29:59 AM

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I am upside down on Condo by about $115,000. In order to short sale it seems I must be in default, so it is a race between short sale or foreclosure... is it true that the "DEBT RELIEF ACT" says that the cannot come after the balance on a foreclosure?

Robert –Jan 24, 2011 09:25:21 AM

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I think we are going to bounce along the bottom of this market for some time (10 years). I do not think prices will move up or down very much. In the long term median home prices should be determined by median wages. If wages do not go up over the long run we will see prices increase by the traditional amount of 3% to 4% a year.

Doug Nance –Jan 24, 2011 09:24:57 AM

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01/24/11 RUNDOWN


	The Las Vegas Housing Market


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