It was recently publicized that the state of Nevada will receive almost $2 billion as part of a $25 billion government settlement with banks over their illegal foreclosure procedures. However, that positive and uplifting news hasnâ€™t helped the Las Vegas housing market at all.
New home sales in Las Vegas are still declining, falling almost 10% in the month of January, making the number of home sales the lowest itâ€™s ever been in the area. This decrease in new home sales is also a sign that the Las Vegas area will continue to experience economic hardship until the number of vacant houses starts to decrease.
There are almost 200,000 properties in the Las Vegas area that are underwater; essentially people owe more on them than what they are worth. Because of this, people that may have once been interested in building a new home are hesitant to do so. There are still thousands of foreclosed and short sale (the bank agreeing to sell a home for less than what they are owed) properties on the market and, unfortunately, home prices on traditional sales wonâ€™t increase until these foreclosed and short sale homes are gone.
Because of this, the settlement that the banks and the government have agreed to might be a good thing. Last year the number of foreclosures decreased because financial institutions were anticipating a government settlement and were wary to do anything until they knew for sure if this was going to occur. Now that a settlement agreement has been reached, you can anticipate an increase in foreclosures once again. Obviously, this isnâ€™t the best news for those that are behind on their monthly payments, but itâ€™s imperative for the local economy to turn around.