LAS VEGAS -- It's estimated there are thousands of foreclosed homes about to hit the local housing market.
According to banking and real estate insiders, Las Vegas real estate is about to take another big hit, and it could delay the recovery for years to come.
Foreclosure notices continue to be posted on homes around the Las Vegas valley. ?
"What I'm hearing from sources, is that work has never been busier," realtor Jared Jones said.
According to real estate experts, a new wave of foreclosures is about to hit the market. It will most likely turn what has been a seller's market, for the last few months, into another foreclosure free-for-all. It could potentially drive Las Vegas Home prices down even further.
See the background numbers that impact the housing market
Industry experts are expecting as many as 70,000 newly foreclosed properties to flood the market. The inventory has been building up since October when a new law took effect making it more difficult for banks to foreclose. That gave the Las Vegas housing market a much needed shot in the arm.
"It almost feels like it did in the boom years of 2004, 2005 and 2006. People were receiving multiple offers and people were bidding over list price," said Brian Gordon of Applied Analysis.
"The reality is that a lot of that's been a function of limited supply on the markets," he added.
In September 2011, just before Assembly Bill 284 took effect, banks were foreclosing on about 3 to 4,000 Clark County properties a month. After the new law took effect, notices of default dropped dramatically to a low of about 800 a month. Foreclosures have stayed down ever since, but that's about to change.
"Foreclosures will ramp up shortly. I would argue, probably in September," said Bill Uffleman, president of the Nevada Bankers Association.
Uffleman said the banks have found legal ways to step up the foreclosure process again.
"If you took 3,000 a month is the norm, I think we will get back to 3,000 a month maybe 4,000 thousand."
"A lot of experts that are watching the default data are saying there are 70,000 homes that are in some type of default status,"Jones said.
He believes the entire Las Vegas housing market will start feeling the effects of this next wave by February or March and people will see many more properties available.
"I believe builders will slow down land purchases, later this year,' Jones said.
Jones, who the Wall Street Journal named the 4th most productive agent in the nation in 2011, is so convinced prices are going to drop here, that he's selling some of his own investment properties now before prices decline.
"You in my opinion, want to be on the market, sold, closed, or near closed. if not completely closed before the spring. I'm taking this agenda with my own portfolio," Jones said.
He plans on buying more properties after the market hits bottom again. The consensus seems to be sometime next yea with the after-affects impacting the Las Vegas market for quite a while.
"It's still a delicate situation, and is going to remain in that state for months or potentially years to come," Gordon said.
The numbers show increased foreclosure activity. There were 521 in May, 629 in June, 914 in July, and possibly 1,000 new foreclosures in August. And Uffleman expects to see three or four times that amount per month. The good news is the banks can't release all the built up foreclosures all at once. It takes time to process them so there will be a steady stream, expected to reach as many as 4,000 a month which will create a buyer's market.
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Source: http://www.8newsnow.com/story/19409359/las-vegas-housing-marking-facing-foreclosure-glut
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