Odd City Out

Housing improves elsewhere, but not in Las Vegas

It’s not news that housing prices are down in Las Vegas. But adding insult to injury are new reports showing that while other cities are inching toward recovery, we’re not.

Standard & Poor’s Case-Shiller Home Price Indices of 20 U.S. cities was published July 27, and it showed small home-value increases in 19 of the 20 cities sampled for May compared to April, and also compared with May 2009.

Las Vegas was the only city that had a decrease—0.5 percent—from April, which puts values off 56.4 percent from their peak in August 2006.

In addition, Las Vegas’ existing-home sales were 3,592 in July, a 17.8 percent decrease from the same month a year ago and down from 4,298 in June of this year, according to Home Builders Research, a company that specializes in the Las Vegas market. (There was a bit of good news as well: Sales here are up 3 percent for the first seven months of 2010 compared with 2009.)

The inventory of unsold homes on the market here grew to 14,000 in July, according to figures compiled by ZipRealty Inc. and published Aug. 6 in The Wall Street Journal. The inventory of unsold homes is the main reason why Las Vegas’ housing values are still sliding, says Coldwell Banker listing agent Mark Rink.

“We still have inventory to clear out before we’ll see an increase in housing values,” Rink says.

There are a lot of people here who have to come to terms with the fact that property they invested in is now worth less than half of what they paid for it.

“Lots of people who have good jobs, like doctors or lawyers, and can make their payments,” he says. “But if they’re paying more than it’s worth and there’s no end in sight, when are they going to get that money back? At that point, they have to make a business decision and let the house go.”

The good news? One day, housing values will rise, he says. “Once people make a decision and get off the fence, and decide to short sell their property or go into foreclosure, we’re closer to housing values going back up.”

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