Nevada foreclosures skyrocket, news better for north

Nevada & Las Vegas Foreclosure News

Andrew Pridgen
Appeal Staff Writer

Nevada's housing trends closed out 2007 with some of the most dismal numbers in recent history, according to a report released this week by RealtyTrac, a California-based firm.

The report said Nevada, in the fourth quarter, averaged one foreclosure in every 392 homes. The national average is one in 1,055 homes going through foreclosure.

But there was some good news: The most recent foreclosure numbers, while increasing by about 200 homes on average from this time last year here, bumps Nevada down from the top spot to No. 2 in the nation. Colorado leapfrogged Nevada.

The better news: For Carsonites, Northern Nevada is faring much better than the southern part of the state. The report showed Carson City had 20 homes and Washoe County had 32 homes in foreclosure - well below the national average - with approximately one in every 4,400 households.

In contrast, Clark County had 2,163 homes, one in 277 households, in foreclosure by December's end.

Local Realtors said they are not wholly laying blame on their counterparts in the lending industry. Subprime and predatory lenders have caught much of the blame not only for the housing crisis, but the down-turning economy as a whole.

"I don't think there's any animosity toward (lenders)," said Art Angelo, a Realtor for RE/MAX, who has been selling real estate in the area since 1980. "I think it's a shame that some people got loans that shouldn't have gotten a loan.

"You can't blame it all on the lenders. Everybody got excited about owning their piece of the American Dream. If you look at it closely, these individuals thought their income would adjust to meet (the mortgage). It didn't. I wouldn't pile up on the lenders though - everyone piled up on the bandwagon."

Even if foreclosure numbers here don't match the southern part of the state, Northern Nevada contractors have slowed their building, which has helped limit the rise in the foreclosure rate, said Thomas Vetica, operations specialist in the Reno office of the U.S. Department of Housing and Urban Development.

That the housing inventory is being given time to "catch up" to what the market will bear is a good thing, Angelo said, even though he shared empathy with those who make their living doing construction.

"Essentially, we're all in the same boat," he said. "When the industry's down - it's down across the board.

"I think the first six months of '08 will get even worse, until we absorb some of that housing inventory, but I think overall this will be a short-term trend. I think that you got to kind of hang in there and ride out the market. Real estate still is the best investment you have.

Several local mortgage brokers said they're similarly girding for the worst of the slow-down, but shared an outlook that the market will rebound over the next few years.

Others decried the practices of predatory lenders within their field - especially upstarts in Southern Nevada

"I can't speculate too much on what happened (in Las Vegas)," said Debra Nevins, broker/owner of Carson's Sierra Valley Mortgage. "But rumor has it there were many just horrible, horrible scams going on in Vegas. If those rumors are true, that greatly contributed to (foreclosure) numbers.

"Here in Northern Nevada, it's a different kind of market, a different place. I do think we have some more of that down-home attitude."

Both Nevins and Angelo referenced prior tough times, citing the early '80s as the best example, of how everything runs in cycles.

"Every market has an up and a down cycle and we're in a down cycle," said Angelo. "We experienced that in 1980, when interest rates were 18 percent. I can't even imagine that now."

Nevada isn't the only state in the West feeling the foreclosure pinch. Numbers released Tuesday by San Diego-based real estate tracking service DataQuick also showed a big uptick in California foreclosures, especially the once rock-solid Bay Area.

Lenders repossessed 31,676 residences in California in the October-November-December period, according to DataQuick Information Systems.

That was a dramatic 421.2 percent increase from 6,078 in the year-ago quarter.

In the Bay Area, foreclosures rose a record 482.5 percent to 4,573 in the fourth quarter, compared with 785 a year ago.

"Foreclosure activity is closely tied to a decline in home values," DataQuick president Marshall Prentice said in a statement.

DataQuick also said in the same report that foreclosures in the West may be hitting its peak - noting most of the loans that went into default in the fourth quarter of '07 were originated between August 2005 and August 2006, during the height of the subprime loan frenzy.
 

Article Source http://www.nevadaappeal.com/article/20080124/NEWS/904134330