In Business Las Vegas reports from Nevada. "Former Nevada State Bank appraiser Patrick Egger with Stewart Title, recently gave real estate agents his take on the Las Vegas housing market and its future."

"Egger said people make a mistake when they try to compare the existing market to 2004 and 2005 when there was rapid appreciation and homes sold quickly. 'We keep trying to make the benchmark a record year, and it's not fair,' Egger said. 'This will be the third best housing sales record in history. It won't be as good as 2004 and 2005, but that's not what the whole world wants to focus on.'"

"Normally, 60 percent of the market's home sales are resales and 40 percent are new, but that has reversed because the incentives offered by homebuilders makes them more attractive, he said."

"Even with more than 20,000 homes on the market, homeowners have been reluctant to give back equity. But he said prices are coming down, and that will help jump-start the market, Egger said. 'They are greedy,' Egger said. 'They don't want to believe what is happening. Mary's house sold for $450,000, and they think their house is better and don't want to leave money on the table.'"

"With a large number of investors and home buyers relying on low down payments and adjustable rate mortgages, Egger said it's likely that the number of homes entering foreclosure will increase."

"Although Las Vegas homebuilders are falling out of escrow and dropping options on land, that doesn't mean there isn't any land activity, said Richard Lee, VP of First American Title."

"How quickly home builders move through their inventory will determine their next moves but Lee said conditions could last from six to 18 months. 'It is just an adjustment of the market, not a collapse,' Lee said. 'It's a realignment of how many years ahead of the curve they need to be. They don't want to be six or eight years out, but maybe two to four years.'"

"A slowdown in the Las Vegas Valley housing market is starting to uncover a growing number of mortgage fraud cases." "Investigators for the FBI, state Mortgage Lending Division and local law enforcement said complaints of mortgage fraud are picking up and will undoubtedly increase as the number of properties entering foreclosure continues to rise."

"Many of the complaints involve falsifying home mortgage applications, including exaggerating incomes and claiming investment properties as a primary residence. 'Mortgage fraud is just beginning to jump by leaps and bounds in this town,' said Pete Dustin, a part-time white-collar crime investigator for Metro Police. Dustin said the number of complaints has risen from one or two a month to one or two a day."

"'When everybody is getting paid, nobody cares. The second they start instituting foreclosure proceedings, they pay attention. The lending institutions are going to start screaming,' he said."

"According to a foreclosure-tracker, one out of every 452 Nevada homes entered the foreclosure process in September, for a total of 1,919 properties beginning the process. The number is up 237 percent from September 2005."

"Scott Bice, commissioner of the Mortgage Lending Division, said his office has 300 active complaints, many of them dealing with mortgage fraud. 'This is as high a complaint log I have seen in three years in business,' Bice said. 'And I don't see it slowing down. Right now with the slowdown in the market, all these little things are popping up. In a rising market, even if people inflate, everything bails them out.'"

"One of the most prevalent mortgage frauds committed is buyers stating on their loan applications that the home they're purchasing is their primary residence, when they only intended to acquire it as an investment property and flip it, authorities said. In other cases, buyers misstated their income to secure mortgages or mortgage brokers coached them to doctor their applications as a way to secure loans."

"Authorities cited cases they are investigating in which mortgage brokers, working in cahoots with buyers, submitted loan applications to various lenders for the purchase of more than a dozen properties. The buyer didn't have enough income to qualify for that many loans."

"'The problem with mortgage fraud, and it's true with white collar crime (in general), is that it pays well,' Bice said. 'The way the system works is that people don't report fraud until there are losses. Mortgage fraud is that dirty little thing that people don't talk about because once they start bringing it up, they are liable for their actions or losses.'"

"Steve Schauer, president of a local mortgage broker, said he's not surprised authorities are investigating more fraud cases and pointed out those problems in the industry hurt legitimate borrowers who want to purchase a home. 'The white lie in my opinion is more and more lenders are falsifying documents,' Schauer said. 'It doesn't show up until the foreclosures happen and it hurts all of us.'"

"David Nanz, a special agent with the Las Vegas FBI who investigates white collar crimes, said one of the biggest causes of the mortgage fraud in Las Vegas is lack of due diligence by lenders. He said there have been cases in which a buyer will claim a certain income and the lender won't even contact the employer for verification."

"'In my view, I think it is a rush to make loans,' said Nanz. 'The bottom line is they are trying to get as many loans as they can.'"