The LVRJ reports today that foreclosures are down in Las Vegas. I was particularly struck by this sentence:
Nevada ranked No. 8 in the nation with 3,176 foreclosures, down from 4,020 in September.
That is a BIG decline in foreclosures. And it’s almost exactly equal to the number of sales in the month. So Vegas is absorbing all of its foreclosures right now.
Behind the scenes, the biggest danger to the economy is an extended absence of credit.
Credit is loosening, however. The LIBOR rates have been falling, which is a good measure of bank comfort level. LIBOR is now the lowest it has been since 2004, which means that banks are now extremely comfortable lending each other money overnight.
There’s also a sorta upbeat article in the LVRJ, about banks that want to lend but can’t find borrowers.
As of today, the MLS shows 3,153 closings in October. Comparing that with September, August, and July, this is a very strong result. Las Vegas sold the same or more than in previous months, even though October closings were generally put into contract in “low season” hot summer months.
3,153 Sales in October!
Circuit City, which is having all sorts of business difficulties, announced a ton of store closings today. It closed, for example, 5 stores in Phoenix and Scottsdale. However, it didn’t close any of its Las Vegas stores. The smart companies know that Las Vegas in the medium term is poised for significant population growth.
There’s plenty not to like here, such as the big drop in passengers through McCarran, but I’m cheered by the 100% increase in home sales. Another interesting point is that total employment is up over a year ago. Not by much. A year ago there were 923k jobs and now there are 924k jobs. It’s important to realize that although the unemployment rate has jumped, that’s more a testament to the fact that people keep moving to Vegas than a statement on meaningful job losses. The 5,714 new residents is also pretty impressive. That’s really not much less than we were getting in 2006.
It’s no secret that all eyes are on the state of the housing market as the search for the answers to America’s financial crisis continues. This was evident in an article posted recently by the New York Times explaining that the Dow reacted positively to an encouraging report on housing sales.
The report showed an increase of 2.7 percent in new homes sales in September.
As we know, construction of new homes has all but halted, so we are now working toward eating away at the new home inventory, and the current price reductions are prompting that. As Frothing Developer mentioned earlier, if only it were easier to get a mortgage! Reducing the overall home inventory, both new and existing, would happen a lot quicker. We can already see the light at the end of the tunnel – existing home sales are way up with the West, and perhaps Las Vegas itself, leading the way. Let’s hope now that encouraging news on the mortgage front keeps us moving, and that what’s happening in Vegas, happens in the rest of the country.
– Frothing Sherri