Las Vegas Luxury Properties Link

We're number 1, we're number 1....in up-side-down mortgages. Again, not the thing you really want to be leading the nation with, but that's our market right now.  There is a great report just released from First American CoreLogic on the Fourth Quarter housing statistics.  Over 11.3 million mortgages are under water.  Nevada seems to be the epicenter of the housing meltdown, even though prices have stabilized, the numbers are surprising. Here's an excerpt from the report:

 Negative equity continues to be concentrated in five states: Nevada, which had the highest percentage negative equity with 70 percent of all of its mortgaged properties underwater, followed by Arizona (51 percent), Florida (48 percent), Michigan (39 percent) and California (35 percent). Among the top five states, the average negative equity share was 42 percent, compared to 15 percent for the remaining 45 states. In numerical terms, California (2.4 million) and Florida (2.2 million) had the largest number of negative equity mortgages accounting for 4.6million, or 41 percent, of all negative equity loans.

The blog "Calculated Risk Blog" reported:

These homeowners are far more likely to default.

The rise in negative equity is closely tied to increases in pre‐foreclosure activity and is a major factor in changing homeowners' default behavior. Once negative equity exceeds 25 percent, or the mortgage balance is $70,000 higher than the current property values, owners begin to default with the same propensity as investors.

 Here is figure 4 from the report.

The default rate increases sharply for homeowners with more than 20% negative equity.

This graph fits with figure 2 above and suggests a large number of future defaults in Nevada, Arizona, Florida and California.

The aggregate dollar value of negative equity was $801 billion, up $55 billion from $746 billion in Q3 2009. The average negative equity for an underwater borrower in Q4 was ‐$70,700, up from ‐$69,700 in Q3 2009. The segment of borrowers that are 25 percent or more in negative equity account for over $660 billion in aggregate negative equity.

Because Nevada is SO upside down, loan modification programs, and short sales have taken over our market.  Out of the 10,135 Single Family Homes, Townhouses, and Condos that are currently available on the multiple listing service in Las Vegas/Henderson, 4900 are short sales, and 1550 are foreclosures or bank owned properties.    Banks are now on board the short sale wagon.  They want to work with sellers to avoid foreclosure.  Bank of America, one of the most notorious banks in the short sale world, is the first large bank to sign on for the Second Lein Holders program-H.A.M.P. (Housing Affordable Modification Program).  If you'd like more information regarding a loan modification, please visit Making Home Afforable.   These programs also facilitate the short sale process.  Some of these programs do seem to be making a difference.  Short sale closings have increased to 22% of all home sales in January 2010.

If you would like a FREE, confidential short sale consultation, please give me a call toll free at 1-866-589-1646.  We're here to help you avoid foreclosure, get a loan modification, or assist you to short sale your home.  Certified Short Sale Professional and Certified Distressed Property Experts handle every aspect of your short sale.

Felipe Crook

Prudential Americana Group Realtors

Las Vegas, NV 89117

1-866-589-1646