A report from the Arizona Republic. "The number of Valley homeowners losing their homes to foreclosure has shot up 566 percent so far this year, a result of the housing market's slowdown and rising interest rates on a variety of risky mortgages. Through October, there were 7,139 foreclosures, according to Information Market. That compares with 1,072 foreclosures for the same period last year. Last month alone, 1,396 Valley homes fell into foreclosure, compared with 934 in September."

"'The foreclosure problem in Arizona is only going to get worse,' said Fred Karnas, the new director of the Arizona Department of Housing."

The Arizona Daily Star. "Sean Kennedy and his wife, Katy, worked for about a year at Tucson-based First Magnus Financial Corp. before the company laid off most of its employees Aug. 16."

"Now Katy Kennedy is a La-Z-Boy salesperson, and Sean Kennedy is working odd jobs including occasional shifts at his family's Dairy Queen while he looks for more permanent employment. The couple earned about $70,000 combined at mortgage lender First Magnus but are now making do with significantly less and have dipped into savings to help make ends meet."

"Four of the 12 former workers interviewed for this story are still looking for permanent jobs. Of those who found jobs, two said they are earning less than they did previously. Five said they are making about the same but declined to be specific. Just one reported finding a better-paying job."

"The Kennedys, for instance, both had jobs related to First Magnus' practice of selling loans to investors on the secondary market. Such jobs would be difficult to find in Tucson, local industry experts said."

"'It's hard when the market is flooded with everybody at once and everybody has the same qualifications or better than you,' Sean Kennedy said."

"Janice Boyd, also a former processor, said she is taking 'a little break' after months of job hunting by attending job fairs and applying to insurance firms and local government offices. But she's staying away from the mortgage industry, she said."

"'I'm not looking for mortgage jobs,' she said. 'Not the way things are going right now with the mortgages, no.'"

"Pima County's Development Services Department added $1 million in new staff costs over the last six months, despite running a projected deficit of up to $5 million. The department...has seen its revenues plummet along with new housing starts and now is struggling to find ways to cut expenses."

"Development Services Director Carmine DeBonis said he did not anticipate the severity of the slowdown or how long it was likely to last when he was making hiring decisions earlier this year."

"'Hindsight always is 20/20,' he said. 'At the time we came up with the budget, no one anticipated the drop-off in the residential market that occurred.'"

"To meet its $15 million budget, the department needs to earn $1.3 million a month through permits, inspections, plan reviews, zoning and comprehensive plan changes and subdivision fees. But the county processed just 8,500 residential building permits last year, the lowest level since 2002, and permits may not break 5,000 this year."

"In September, the department processed just 105 residential permits. Monthly revenue has dropped to less than $900,000."

"Some builders and real estate experts questioned how the department could not have foreseen the decline. Duane LeGate, president of HouseBuyerNetwork.com, said he realized the downturn was coming in June 2006 when his company saw a huge increase in the number of distressed properties for sale, and it was apparent to most observers by January 2007."

"The slowdown was clear by January or February, said Tom Doucette, owner of local builder Doucette Communities. 'It seems they ignored the signs of what was happening,' Doucette said. 'They hear the development community say things are bad, and they think we just don't want to pay more fees.'"

"If the department saw continued activity through the first half of 2007, Doucette said, some of it may have been national builders continuing to request permits in the hopes the slowdown would be temporary. But local builders already had scaled back their activities."

"Doucette said he, like many builders, already has laid off employees and may have to lay off more. He questioned why the department would consider raising fees instead of letting staff go."

"'What are these people going to sit around doing when nobody is applying for permits?' he asked."

The Review Journal from Nevada. "Consumers will have to wait a little longer than expected to buy into a major green-housing project. Pulte Homes has pushed back the opening of its Reverence community in Summerlin from July 2008 to sometime in 2009."

"Company officials wouldn't elaborate on the reasons behind the deferred opening beyond pointing to general delays in the land-development schedule."

"Ken Perlman, VP of Sullivan Group Real Estate Advisors, said a development-related halt in activity at Reverence could benefit the project in the long run. Given the sluggish housing sector, sales of new homes fell 43.7 percent in September when compared with the same month a year ago, according to SalesTraq, opening later than planned could buffet the neighborhood from further fallout in a down market."

"'Instead of trying to jump-start a project in this kind of economic period, it makes excellent sense to work through (development) schedule issues as the market begins to sort itself out,' said Steve Bottfeld, an analyst Marketing Solutions."

The Las Vegas Buiness Press from Nevada. "Centra Properties, a local developer responsible for $3 billion worth of projects, has liquidated nearly all of its Las Vegas area assets."

"Centra Point's recent sale marks the latest in a series of company divestitures stretching back to 2005. In May 2005, Centra unloaded 25 acres to the Edge Group for $202 million. It marked a 62.8 percent premium over the original purchase price just two years earlier. The site was the location of the failed $3 billion Las Ramblas condo-hotel-casino complex that was canceled amid a high-rise market downturn."

"'Realistically, you cannot buy property at today's retail prices and still build things, unless your have a competitive advantage,' said Jeremy Aguero, principal of Applied Analysis. 'Developers must now have cash on hand in order to make projects happen. Banks and Wall Street are tightening lending requirements. As a result, we're dealing with a new reality that's going to be around for a while.'"

"CB Richard Ellis brokerage is reporting 7.7 percent apartment vacancy for Las Vegas in September, down from 7.9 percent in August. The Class A segment showed 6.7 percent vacancy for 28,500 units reporting; the middle market (40,000 units) had 8.3 percent vacancy; and the bottom end (27,000 units) reported 7.8 percent vacancy."

"'We're certainly being impacted by the number of single-family homes being rented,' CB Richard Ellis apartment specialist Spence Ballif said. 'Apartments are really getting back to stressing what they offer, the amenities and services and how quickly things get fixed. If you're renting a house from an out-of-town investor and something breaks, good luck getting it fixed.'"

In Business Las Vegas from Nevada. "The supply of single-family homes in Las Vegas and slowing job growth are preventing apartment owners from raising rents as much as they did a year ago."

"The reason for the slowdown in rent growth was increased vacancies. The occupancy rate dropped to 93.5 percent in the third quarter, down from 95.8 percent in the third quarter of 2006, Applied Analysis reported."

"Aguero said the record level of existing-home inventory would begin to whittle down by then. As for prices, he said new-home prices, which have fallen 15 to 22 percent from their peak, don't have much farther to go unless there is a broader correction to the market."

"The Bureau of Land Management is considering whether to abandon its policy of refusing to sell land for less than its appraised value. Only one of 31 BLM parcels sold at the lackluster auction Nov. 1, which was the worst this decade by BLM standards."

"The auction placed 167.5 acres up for grabs in Henderson, the southwest and other areas. Only the sale of one 15-acre site kept the auction from being a shutout."

"Juan Palma, BLM's Las Vegas field manager, he said it is possible that at the BLM's next auction, tentatively scheduled for April, it may for the first time, allow bidding to start below the appraised value."

"Bidders would be required to meet the reserve price, which is the appraised value, Palma said, but the more open bidding process would give insights as to the level of interest in the federally owned land and its current market value."

"That could ultimately lead to changes that would allow property to be sold for less than appraised value, he said."

"Palma said that with a slowdown in the housing market and softened demand for land in the Las Vegas Valley, the appraisals lag behind the current market and tend to look at what the land was once worth."

"Palma...noted that with the housing slump and the appraisals' failure to capture declining values, auctioned land is priced to the point where there are no bidders, Palma said."

"'When the market is in an upswing, the appraisal system works, but when the market is not going down, the appraisal system doesn't work,' Palma said."

"Craig Cherney, director of Western operations of a private equity and land acquisition group, said it is not surprising that parcels didn't sell at the auction in a market where prices continue to decline."

"'There is no demand, and basically it is a supply and demand problem,' Cherney said. 'There is overhang in the private real estate market and until that is burned through, there is going to be little demand from public and private homebuilders.'"

"Cherney said he doesn't believe going to a process of accepting bids lower than appraised value while setting a reserve price will generate more interest in the bidding process. If the buyers know they have to meet the reserve price, they're not going to take a half a day to go bid on properties they know they won't buy."

"What would work, Cherney said, is an auction that starts at appraised value and ratchets down in increments to a point that bids are made. Then, the price can go up from there, he said."