A report from the Arizona Daily Star. "Selling a house at auction might sound like an act of desperation. But one casual investor thinks it's the only way out of a tough spot in a slow market. Alison Torba put a two-bedroom house and a duplex near North Swan Road and East Pima Street on the market last spring. Neither has attracted an offer."

"After price reductions, they were listed at $138,000 for the house and $265,000 for the duplex — which dozens of agents representing prospective buyers told her were reasonable prices. Facing increased payments for an adjustable-rate mortgage and a $100,000 home-equity line of credit for renovations, Torba said she can't afford to wait for the market to pick up again."

"'It's really scary,' she said. 'I thought the houses were going to sell immediately.'"

"The prospect of getting lowball bids and possibly losing money frightens her, she said, but she thinks it's best to cut her losses. 'Much of my equity has been eaten away with payments,' she said."

"The number of sales in August was down about 26 percent compared with the same month last year, according to statistics released Friday by the Tucson Association of Realtors MLS."

"Real estate executives acknowledged that some sellers, including Torba, might be finding themselves in a bind. An auction could be a 'legitimate tool' for dealing with a slow market, said Rick Hodges, CEO of the Tucson Association of Realtors."

"But the final price might be tough to swallow, he added. 'You have to be prepared to sell at any price, because you may have to sell it at any price,' he said."

The Arizona Republic. "More than a dozen ranchers and homeowners in the unincorporated northwest Valley are questioning why Surprise would allow developers to build thousands of homes there amid a general slump in the housing market."

"Right now, about 40,000 homes...are proposed for the area, with the intention of annexing them into Surprise at a later date."

"'We have hundreds of homes in foreclosure. Why are we going to build 500 more?' Wittmann resident Elizabeth Oldham asked at a recent planning and zoning meeting."

"Oldham and others are critical of Surprise for not being able to fill homes that lie within city limits. Surprise's vacancy rate hovers around 15 percent, compared with the county rate of 7 percent, said Jeff Romine, senior regional economist with the Maricopa Association of Governments."

"Though vacancy rates in newer cities tend to be higher, he said Surprise still leads similarly new communities like Goodyear and Buckeye, which have vacancy rates of 8 and 10 percent, respectively."

"Laws enacted by the Legislature get legal legs Wednesday. Starting this week, Arizona will have one of the nation's tougher laws on mortgage fraud. The mortgage fraud law makes it a felony to issue mortgage loans under conditions that prove to be fraudulent. It targets the cash-back deals that were popular before the market turndown."

"'With what's going on today, if the law had been in place a year ago, it might have led to a decrease in the schemes and scams that have undermined not only the state economy, but the national economy,' said the bill's sponsor, Sen. Jay Tibshraeny."

The Gazette Journal from Nevada. "The winds driving Washoe County's condominium market are swirling every which way. Year-over-year sales in the second quarter plummeted while sales from the first quarter to the second quarter rose. Ditto for the median sales prices."

"Some planned downtown Reno high-rises have been put on hold. Other projects are moving ahead."

"Add in the home financing gloom that enveloped Nevada and the nation in August, observers say, and there's little doubt the region's condo craze of two years ago has blown away."

"'The mania has clearly subsided,' said Floyd Rowley, senior VP at Colliers International in Reno."

"As Rowley sees it, all eyes are on the Palladio, the 14-story, 92-unit complex nearing completion downtown. Last Thursday, Dave Clark, the court-appointed receiver overseeing the Palladio's progress, said he has about 28 units left to sell but acknowledged the past month has seen the market 'come to a crawl.'"

"'We originally targeted the end of '07 to sell out, but in all probability, it will take longer,' he said."

"Another major downtown project, The Montage with 380 units on the site of the former Golden Phoenix hotel-casino, is proceeding with completion set for next spring, said Fernando Leal, of L3 Development."

"'Sales are consistent but slower than we hoped for,' he said."

"Arterra, a 16-story, 185-unit complex slated for Sierra and Liberty streets, was halted before construction began. Sluggish sales have also forced Capstone to rent 108 of its condos at the Village at Idlewild Park complex as apartments."

"Also downtown, the twin 449-unit Wingfield Towers planned for the south side of the Truckee River is on hold while its developers work, with a target date of October, to have financing in place as part of a bankruptcy protection filing."

"'The housing slowdown is driving the financing issue,' spokesman Chris Barrett said."

"Another factor crimping the condo market is the narrowing of the price gap between condos and stand-alone homes. That was once a big incentive to buy a condo when detached-home prices were soaring, said Pat Martinez of Prudential Nevada Realty."

"But not now. Factor in condo association fees that can be hundreds of dollars a month, and 'you can get a house for about the same price,' he said. 'That's a big problem, especially in downtown.'"

"Tom Cargill, economist at the University of Nevada, Reno, agrees a condo's attraction can wane when stand-alone home prices fall. 'There's less room to lower their prices. It's a tough situation for a (condo) developer,' he said. 'Condos are still second-best to a home for a lot of people who want space between themselves and someone else.'"

"No one expects a condo collapse; indeed the market slowdown appears worse only because the housing market had been so hot, observers said. 'The phones are ringing more,' Martinez said. 'There's a lot more showings, but they're not turning into closings right now.'"

In Business Las Vegas from Nevada. "The slowdown in the Las Vegas housing market and challenging conditions in the mortgage industry have slimmed the ranks of Nevadans who hold mortgage licenses."

"The state Mortgage Lending Division reported last week that the number of licensed agents has declined 23 percent in the past 12 months from 11,701 to 8,974."

"Many companies have filed for bankruptcy or closed shop altogether. But the latest numbers don't tell the whole story of what's happening in the industry."

"'What's happening in the housing industry has a ripple affect,' said Chas Horsey, administrator of the Nevada Housing Division. 'Appraisers, Realtors and mortgage lenders are feeling the impact.'"

"That's especially true for mortgage agents who don't get paid a salary but rely on commissions, Horsey said. 'If there are not any new loans being made, they are not able to put food on the table,' Horsey said."

"The slowdown caused loan specialists such as Mark Sarrazin with US Mortgage in Henderson to allow his license to lapse earlier this month. Sarrazin said he got his license a year ago to work part-time with his friend's firm."

"But after one year, Sarrazin said he's only done three loans and none recently. He said he doesn't know if he will renew his license, but at this moment it doesn't seem worth the time."

"Steve Schauer, president of National Lenders Service, said the housing slowdown has prompted him to cut his staff of 30 six months ago to 15 today."

"Many mortgage brokers are getting out of the business because they didn't take the time to learn about various financing options, Schauer said. Many were part-timers who saw the opportunity of a hot market and are now learning how difficult it is and can't keep pace with the changes in the industry."

"'At one point, loans were easy and anybody could do a mortgage,' Schauer said." "Schauer said he believes that's good for the industry because it raises the competency and education levels needed to broker loans."

"'We no longer have waiters who are also mortgage people,' Schauer said. 'You could go into a restaurant and a waiter would give you a card. You no longer have that. They just do not have the knowledge of the profession to keep a client.'"