The Housing Bubble

A report from the Longview News-Journal in Texas. “A sharp increase in foreclosures is blamed for causing the housing market in the Longview area to plummet to second from the bottom among 200 markets nationwide, according to a new home-value forecast. The spike in the foreclosure rate, to 34 percent in the final three months of 2016 from 8.84 percent a year earlier, was probably an impact of the slow recovery in the energy industry, said Tom Hoff, director of marketing for Pro Teck Valuation Services. He noted the bottom 10 markets in the report included four energy-producing areas. Pro Teck’s report shows the four-county Longview market dropping from near the middle in the final quarter of 2015 to next to Las Cruces, New Mexico, at the bottom of the bottom 10 of 200 markets by late 2016.”

“Jim Gaines, the Real Estate Research Center at Texas A&M University’s chief economist said it takes a couple of years to cycle through foreclosures, which might have led Pro Teck to determine the rate to be 34 percent. Gaines acknowledged the oil industry slump has hit the Longview area hard, but perhaps not as much as Midland and Odessa. Pro Teck’s report showed Midland ranking immediately above Longview. ‘The economic impact might have happened a year and a half ago,’ he said. ‘The decline in the price of oil started in mid-2015. It is not an immediate impact.’”

From Delaware Online. “Delaware had the second highest foreclosure rate in the nation last year, a recent study reported. The study also found overall foreclosure activity in Delaware jumped 45 percent last year compared to 2015, the largest increase of any state. Local experts said Delaware’s foreclosure crisis is the result of the state’s stagnant wages making it difficult for residents to keep up with mortgage payments. ‘We need more, better-paying jobs,’ said Eric Doroshow, a Wilmington attorney who specializes in consumer bankruptcy. ‘You see these families having two jobs and still struggling to get current on a mortgage. Chapter 13 [bankruptcy filings] gives them a chance, but at the end of the day they need more income.’”

“Lawyers are not the only ones noticing the increase in business because Delawareans are struggling to make their home payments. David Sordelet, a Wilmington real estate agent, said six of his 17 active listings are short sales. Sordelet agreed flat wages are hurting Delaware’s housing market. The state’s average annual household income dropped to about $57,000 in 2014 from $67,000 in 1999. Delaware was ranked ninth among the 10 worst states for household income growth. ‘We’ve lost jobs at Chrysler, General Motors, MBNA, DuPont, AstraZeneca,’ he said. ‘That has an effect on values.’”

“Sordelet said mortgage adjustment programs can be problematic, too. He said a recent client did a mortgage modification and attempted to sell her house to get out from under the mortgage. But when she came to the table, the buyer didn’t have enough money for the mortgage and all of the unpaid fees, interests and charges tacked on the back end of her mortgage because of the modification program. The buyer walked away and his client was forced to sell her house in a short sale.”

From New Jersey Spotlight in New Jersey. “Housing markets have improved and foreclosure numbers dropped across the country since the Great Recession, but a decade on, New Jersey remains mired in a deep foreclosure swamp. Some analyses cite Atlantic City as the worst housing market in the country, with Trenton not far behind. Overall, New Jersey continues to have the highest foreclosure rate in the country, according to real-estate data firms.”

“he Federal Housing Finance Agency has offered some continuing assistance to borrowers whose mortgages are insured through Fannie Mae or Freddie Mac. The new ‘Flex Mod,’ flexible modification, program aims to provide reductions of up to 20 percent on mortgages that are 60 days’ delinquent, instead of waiting the traditional 90 days. Like previous foreclosure relief programs, though, Flex Mod may look good on paper without delivering in reality, said attorney Josh Denbeaux of Denbeaux and Denbeaux in Westwood. ‘The question about Flex Mod is not the regulations themselves, it’s whether they will be enforced,’ he said. ‘And the answer to that is no.’”

The Des Moines Register in Iowa. “In many ways, the metro Des Moines housing market has never been stronger. Home prices have reached record highs, and Polk County’s median home value has climbed to nearly $150,000. A wave of new homebuyers has prompted fast-paced sales. Bidding wars have broken out for homes in popular neighborhoods, where prices have surged more than 10 percent since the housing crash in 2008.”

“But Des Moines’ housing surge has left behind thousands of homeowners in poorer neighborhoods that have seen their home values fall as much as 13 percent — even as the economy rebounded, The Des Moines Register’s exclusive analysis of Polk County assessment data shows. In the Oak Park neighborhood on the city’s north side, Nicole Simpson and her husband have been trying to sell their house for more than five months so they can move to the Johnston school district. They like the quiet neighborhood where their children can play. And the home sits on a large, wooded lot on the east bank of the Des Moines River.”

“But the Simpsons couldn’t find a buyer and recently took the house off the market. Assessed values in the area have ticked up only 2 percent since the crash, the Register analysis shows. Several nearby homes have gone through foreclosure and were sold cheap or turned into rentals, which Simpson suspects has brought down property values. ‘It’s a nice place to raise a family,’ she said. ‘We just have the misfortune of having a few houses that are affecting it.’”

From KCWY in Wyoming. “As unemployment numbers remain high in Wyoming, many homeowners still struggle making their mortgage payments. The staff at Wyoming Housing Network has tracked a recent jump in foreclosures over the past four months. They told News 13 there are currently 134 foreclosures in progress across the state. Wyoming Housing Network Foreclosure Counselor, Beth Skidmore shared, ‘There are different things they (homeowners) can do if they can’t repay and they don’t have the ability to maintain the home, then we can help them with their credit and everything and see if we can figure out another situation for them.’”

A report from the Charlotte Observer in North Carolina. “It’s commercial real estate forecast season in Charlotte. Experts and real estate professionals seem agreed that while Charlotte’s white-hot pace of growth in everything from rent to new construction might slow down a bit this year, there aren’t any big, flashing signs warning ‘Crash ahead!’ Put another way, most professionals don’t think we’re sitting on top of another pre-recession bubble here. Still, growth is expected to slow a bit from 2015 and 2016, with words such as ’selective,’ ‘cautious’ and ‘take a pause’ popping up frequently in real estate forecasts.”

“With nearly 24,000 apartment units in development this year throughout the Charlotte region, one of the most frequent questions I get is ‘When are we going to build too many apartments? ‘Yes, you all are building a lot, but you’re also absorbing a lot,’ said Kevin Thorpe, global chief economist for Cushman & Wakefield. But that doesn’t mean average rents are going to keep shooting up at the current burning pace of 35 percent over the past five years. With the big increase in supply, rents are likely to stop growing as fast, and perhaps even fall a bit. ‘I would be anticipating that your apartment sector is going to see a pretty significant softening of rents in the next few years,’ said Thorpe.”

The Sun Sentinel in Florida. “South Florida rents have strongly favored landlords in recent years, but the rental market appears to have peaked, said Marshall Sklar, co-founder of Florida’s Best Realty Services in Boca Raton. While rent increases continue, some tenants are starting to balk at the higher prices, forcing landlords to offer reduced rent hikes and concessions such as free rent, Sklar said. ‘The market is still strong, but it’s not what it was a year ago,’ he said.”

The Anchorage Daily News in Alaska. “Anchorage landlords appear to be seeing more effects of the slowing Alaska economy. Debenham Properties right now is offering prospective new tenants a 5 percent rent discount — more than the typical seasonal deal, Shaun Debenham said. The company is also offering a move-in special that includes $300 off the first month’s rent, something it hasn’t done in the past. ‘I think we have seen a lot of higher-end jobs leave Alaska. Like when oil companies are laying off, it affects a lot of other higher-paying jobs down the line,’ Debenham said.”

From The Gazette in Colorado. “If Colorado Springs’ real estate market and economy were social media topics, they’d be trending - and in the right direction. Single-family housing had a record year for sales in 2016, while apartments filled up and rents soared. The local apartment vacancy rate plunged to 4 percent in 2016 after having been as high as 10 percent in 2008, said Doug Carter, a local commercial broker and part of national real estate firm Sperry Van Ness.”

“But the increases followed years in which rents were stagnant, Carter said. At the same time, Springs-area rents over the last 12 years have increased only about half as much as those in Denver, he said. Denver’s apartment market is cooling, in part, because it’s being overbuilt; 25,000 units are under construction and another 27,000 are planned, Carter said.”

The Las Cruces Sun-News in New Mexico. “New Mexico State University on Friday walked away from a plan to privatize campus housing. NMSU Chancellor Garrey Carruthers said the university has too much housing stock. ‘But you have to keep in mind how we got here,’ he told the Sun-News. ‘Years ago, there were none of these apartments around here. This campus was out here by itself, so the university took it upon itself to build all of this housing. Now we’ve got private apartments all over the place, and we just don’t need it.’”

From Real Estate Weekly on New York. “Rents in Manhattan and Brooklyn continued to trend downward during December, according to the monthly rental market report from Citi Habitats. The last time this much inventory was available on the market was in April of 2009. ‘The most recent data for December shows there is considerable local demand for rental housing. However, there is still a disconnect between the rents that landlords want to achieve and the pricing tenants are willing to pay, which is why concessions remain a significant force in the marketplace,’ said Gary Malin, President of Citi Habitats.”

The Dallas Morning News in Texas. “Dallas-Fort Worth apartment rents weren’t rising as fast in December. The rate of rent increases in the Fort Worth area also declined. ‘D-FW is finally feeling some of the effects of all the new supply hitting the market,’ Axiometrics’ Jay Denton said in the report. ‘While demand has remained relatively steady as job growth has not declined significantly, supply has finally caught up with demand.’”

“Average quoted Dallas-area apartment rents were actually down in December from November — but not by much. About 50,000 apartments are under construction in North Texas, more than any other U.S. metro area.”

The Houston Chronicle in Texas. “Average apartment rents in the Houston area dropped to the lowest level in two years, a new report showed. The Montrose/River Oaks submarket, where many new units have been built in recent years, saw an annual drop of 8.4 percent in December. Houston-area apartment investors and property owners need jobs to be created so demand for their units will increase,” Jay Denton, Axiometrics senior vice president of analytics said in an announcement. ‘Even though construction of new properties is subsiding, a lot of supply is still hitting the market. With occupancy below 92 percent, many units are vacant.’”

Inforum on North Dakota. “Apartment vacancies are on the rise in Fargo-Moorhead. The latest apartment vacancy and construction report, compiled by Appraisal Services Inc. and released Jan. 12, took a snapshot of the community market as of Dec. 1. These reports are for the Fargo-Moorhead metropolitan area, including West Fargo and Dilworth. The latest survey reflects 30,155 units of the estimated 39,050 apartment units now in the metro area. While 236 new units entered the market in the last quarter, vacancies went up by 443, ‘indicating that the market may now be experiencing a shortage of demand to compound the current oversupply of units,’ according to the report.”

“The overall vacancy rate for the metro was 9.21 percent, up considerably from 6.4 percent in December 2015 and 2.9 percent in December 2013. The rate increased in all four communities in the market, with West Fargo having the highest vacancy of 12.55 percent, followed by Dilworth at 12.2 percent, Fargo at 8.85 percent and Moorhead at 7.98 percent. More than 6,000 new apartment units have been built since vacancies hit a recent low of 2.5 percent for the metro, according to the report.”

“But the latest figures are likely a conservative estimate of the reality because the survey only measures physical vacancy, or units that are not occupied, and can’t account for the ‘economic vacancy’ that’s likely more than 10 percent now because of units currently affected by rental incentives or rent delinquencies.”

This thread will be forwarded during my trip through New Mexico and part of Texas, for the purpose of communicating with local bloggers, posting observations and photos. Let’s call this the Shadow Inventory Tour. Pics will be posted on Picasa.

The Austin American Statesman in Texas. “Rooftops could start appearing next year on the long-delayed Flatrock Springs development in Marble Falls, where plans call for more than 2,000 residences. The project was announced four years ago, but the recession and ongoing economic downturn caused managing developer SouthStar Development Partners Inc. to ‘re-evaluate the process,’ said Thad Rutherford , SouthStar’s vice president of project management.”

“The relaunched Flatrock Springs will be a “true mixed-use community,” ranging from $90,000 townhomes to 2-acre ranchettes for $600,000, Rutherford said. He declined to put a dollar amount on the current value of the project, which was reported in 2006 to be about $850 million. The relauching of Flatrock is another sign that development is picking up in the wake of the recession. ‘It’s a different world we live in, but activity is increasing,’ Rutherford said. ‘It never came to a halt like other places in the country, which is a positive thing.’”

“Austin voters would be asked to approve $16 million for a boardwalk along Lady Bird Lake’s south shore, closing a gap in the hike-and-bike trail, under the draft version of an $84.8 million transportation bond proposal for the November election. The boardwalk concept has run into opposition from some lakeside residents. The boardwalk would bring thousands of people each week by the back doors of condominiums, including one owned by entertainment publicist Jill McGuckin. Aside from privacy and security concerns, McGuckin said she is concerned about graffiti and general maintenance.”

“‘Why would you spend $16 million for 1.1 miles to nowhere?’ McGuckin said.”

KVUE in Texas. “You might just call it the life styles of the rich and famous in Austin. Two luxury condos are opening this month and a third by the end of the year. These high rise projects have already changed the face of Austin’s skyline and are revolutionizing Austin’s urban lifestyle. They are some of the most expensive residential housing developed in downtown Austin.”

“The Austonian is the tallest residential building in Austin and the Western United States. It too boasts of its elegant life style and unprecedented views of the City and surrounding Hill Country. To live here, it will cost you between $586,000 to $7.2 million.”

“Arnold and Candy Lipp closed Friday morning on their second home at the Four Seasons Residences. ‘Location was everything for us. We just love the grounds of the Four Seasons, with all the tradition and the amenities,’ said Arnold Lipp. Their two bedroom/two-and-a-half bath condo is on the fifteenth floor with a view of Lady Bird Lake. ‘What can be better than this view,’ said Lipp. ‘It is magnificent.”

“The 32-story high-rise building features 148 condominiums and…range in size from 880 square feet to 5,500 square feet and are priced between $400,000 and $4 million.”

The Star Local News in Texas. “A disturbing trend has developed among foreclosed homes in Collin County. The total number of ‘upside-down’ residential foreclosures for the first half of 2010 increased across the Dallas-Fort Worth area and other parts of the state including Collin County where the rate jumped by 41 percent, according to data tabulated by the Foreclosure Listing Service (FLS) of Fort Worth.”

“Dallas County had the highest increase in the Dallas-Fort Worth area with 56 percent followed by Denton County with 51 percent, according to FLS data.”

“‘Both the homeowners and the lenders of these upside-down homes are in a no win situation,FLS President George Roddy said. ‘Generally, the homeowner cannot sell the home for what they owe on the mortgage and most often, the lender cannot sell the home after repossessing it for the amount that they have invested in the mortgage and other costs that the lender has incurred.’”

“‘Upside-down postings have risen at a much higher pace than overall residential foreclosure posting activity,’ Roddy said. ‘Compared to one year ago, the number of postings filed on homes in an upside-down position climbed 39 percent in the 19-county area; whereas, total residential posting activity increased just 10 percent.’”

The Dallas Morning News in Texas. “In the four-county D-FW area, more than 6,700 foreclosure postings in the first half of 2010 involved homes on which the debt owed was higher than the tax appraisal. During the same time, total foreclosure postings in Dallas County rose only 7 percent. Recent studies estimate about 15 percent of all Dallas-area homeowners with mortgages owe more than their house is worth. They either paid too much for the property or, more likely, values have fallen in their neighborhoods due to distressed property sales and high inventories of unsold homes.”

“Homeowners who are underwater in their mortgages are considered much more likely to default on their loans.”

“Condo and townhouse sales in North Texas have jumped 24 percent in the first five months of 2010 from a year ago. Sales are still below where they were in 2008, according to statistics from the Real Estate Center at Texas A&M University and North Texas Real Estate Information Systems Inc. And there’s no sign that prices are bouncing back. Median sales prices for condos were down 17 percent in May from a year ago. There’s about an 11-month supply of condos and townhouses for sale in North Texas.”

“At the high end, some potential buyers have run into difficulties obtaining mortgages, said Jeff Updike, who owns Dallas’ Remax Urban. ‘You can get way down the road with a deal before you figure out there is just no financing,’ he said.”

“Analyst Mike Puls of Foley & Puls said some buyers of high-end units have had difficulty getting the homes to appraise for what the sellers are asking. ‘That really hurt the ability to sell some of the units,’ he said.”

“One condo high-rise, the House at Victory Park, has been advertising that it provides 100 percent financing for qualified buyers. About a dozen of the 150 units in the 28-story condo tower, which opened a year ago, have been deeded to buyers, tax records show. Condos at the House range from under $400,000 to more than $2 million. Unlike some markets in Florida, Nevada and California, Dallas did not see a condo building boom that left the area with thousands of unsold units when the recession hit. Several proposed Dallas condo projects, such as the Maple Terrace tower, were canceled.”

“‘We came late to that market, so we wound up with fewer units – about 1,000,’ Puls said. ‘We have closed about 60 percent of the high-rise units built that were for sale.’”

The Star Telegram in Texas. “The Parthenon Greek restaurant was torn down to make room for a matching condo building to the adjacent Versailles condos on Henderson Street in 2007, but now it appears those condos won’t be built. Borodino Land, an investor group headed by Fort Worth neurosurgeon Gregory Smith, in April deeded the property back to its lender, Southwest Securities Bank in Arlington, deed records show.”

“Smith said he negotiated the settlement with the bank after it wanted to restructure the loan, which would have made it impossible for the group to move forward with the project in today’s economy. The group had obtained building permits but then held off starting construction just as the financial crunch took its grip on the local markets, he said.”

“The group previously announced plans for a seven-unit building in hope that it would be sold out by June 2008. The property remains vacant.”

New Mexico Business Weekly. “Albuquerque and New Mexico’s foreclosure rates rose in April over March and are substantially higher compared to April 2009, according to CoreLogic. Statewide, however, New Mexico’s foreclosure rate of 2.11 percent was well below the national rate of 3.20 percent in April.’

“The most significant statistic from the CoreLogic report indicates that 6.7 percent of Albuquerque area mortgages were 90 days delinquent in April compared to 3.9 percent last year. Statewide that rate hit 5.84 percent. For the U.S., the 90 day delinquency rate stood at 8.9 percent at the end of April.”

“Although the report didn’t give reasons for the gains, the continuing recession and its job losses, coupled with the resetting of adjustable rate mortgages, are among the most likely causes.”

The Four Corners Business Journal in New Mexico. “As the weak economy has driven down employment rates and hurt the housing markets of Four Corners communities, housing rentals in Durango and Farmington have become increasingly available. The challenge, many area property managers say, is finding tenants willing or capable of renting houses and town homes commanding monthly rental fees higher than $1,000.”

“Adding to the challenge is an increasing supply of rental homes in that price range coming available in Durango and Farmington. As homeowners are struggling to sell their houses on the open market, many are choosing to seek renters and wait for the area real estate markets to improve. ‘In the over $1,000 a month (range), we’re not seeing more people coming into town. That’s been the hardest-hit market,’ said Caroni Adams, owner of The Property Manager in Durango. ‘You have to have a fairly good income to afford it. People don’t have the income, they’re just not coming.’”

“As BP America slowed its operations in La Plata County, the effect was felt by the rental housing market, said Dawn Wright, owner of Durango Property Management. ‘Even up to last year, before BP started downsizing with their subcontractors, that’s who was renting the higher-end homes, people who were contracting for BP or Conoco,’ Wright said. ‘Now there are fewer of them, so we have more high-end units available and we’re seeing them vacant for longer.’”

“Units priced higher than $1,200 can take as much as three months to get rented, Wright said. As a result, prices are dropping on the higher-cost properties, and renters have become very picky about what they are looking for in a market ripe with supply, she said. ‘We have seen a surge of supply and less demand,’ Wright said.”

The Clovis News Journal in New Mexico. “Officials say Clovis isn’t feeling the mortgage crunch that’s squeezing other areas of the country. However, for those with homes that are in jeopardy, help is available. Hope Now is a free homeowner counseling service designed to help people look at their options, according to Housing and Urban Development spokeswoman Patricia Campbell. Also, for the first time, Federal Housing Administration mortgages are being made available as a refinance option to troubled borrowers, she said.”

“Campbell said borrowers must act quickly, because if they wait until they are going under, it may be too late. ‘There are some people who will not be able to avoid (foreclosure), but there certainly is some help out there. (FHA refinance) is a new product that really is an opportunity for people who are behind or they know their (adjustable rate mortgage) is going to readjust this year,’ Campbell said.”

“Financial Counselor Brenda O’Shea said in the last six months traffic has nearly doubled at the Clovis Consumer Credit Counseling Services branch she manages. Financial strain from rising fuel costs, increased food costs and homes that exceed budgets turn into growing credit card debts and delinquencies, she said. ‘Everyone’s getting overextended on the credit cards and they’re getting to where they can’t afford the minimum payments anymore because everything is going up,’ she said.”

“O’Shea said people who never thought their stability would be in question, find they are having problems. ‘Even someone a year ago that thought they would never have been in a predicament like this are having problems,’ she said. ‘There are those who have said, ‘I should have come a year ago but I was embarrassed.’”

The Las Cruces Sun News in New Mexico. “With the economic downturn the past several years, a society that had increasingly been leaning on credit cards found itself relying on plastic to survive the recession. Las Cruces accountant and financial instructor Vivian Moore teaches classes for people who are going through the foreclosure process. She said that some people have no room to maneuver. ‘They feel like they don’t have a choice but to live on credit cards, but they can’t keep up with them,’ Moore said.”

“‘People leaned on credit cards definitely,’ said Dave Hooker, who owns Shorty’s Food Marts in Las Cruces. ‘Credit and debit card usage is way up. It looks like we’re going to a cash-less society.’”

“Still, it does appear as if one silver lining in the recession is the way it has made Americans more cautious with their finances. The personal savings rate has recovered to 3.6 percent, after falling for two months. But, ultimately, is all this saving a good thing for the economy? Some experts believe that better saving habits might delay economic recovery because, as people save more in a tough economy, they spend less.”

“Economists call it the ‘paradox of thrift.’ What’s good for individuals — spending less, saving more — is bad for the economy when everyone does it. Jim Peach, who teaches economics at New Mexico State University, refers to it as ‘fallacy of composition.’ ‘Saving may be very good for me and you as individuals, but the fallacy of composition is: if everybody does it, then we’re not consuming and incomes may be lower,’ Peach said.”

‘He said that in the years before the recession, U.S. consumers were spending at a pretty fast clip. ‘Now you combine an increase in the savings rate with tighter credit restrictions — plus housing loans and automobile loans are in the same situation — and you have a double hit on consumption,’ Peach said. ‘The question is: ‘How long that will last?’ The honest answer is: ‘No one really knows.’”

The Las Cruces Sun News reports from New Mexico. “Verde Realty has scrapped plans for a city-size residential and commercial development on almost 24,000 acres it owns in Santa Teresa. In 2005, Verde announced plans for the 25,000-home master-planned community on mostly vacant desert at the edge of West El Paso. ‘We previously developed a small portion of the Santa Teresa property, but we no longer intend to pursue large-scale development of this land,’ Verde stated in documents filed last week with the SEC.”

“Other developers may be interested in that land, but ‘I don’t see a demand for it now - maybe in five to 10 years,’ said Charles de Wetter, president of one of El Paso’s largest real estate companies.”

“Randy O’Leary, president of El Paso’s largest homebuilder, and president of the El Paso Association of Builders, said he did expect El Paso-area developers to show interest in that land. ‘Everyone has enough land’ to develop for several years, he said. ‘We (Desert View) have as much land as we need for the next five to seven years.’”

“This is the second big proposed master-planned community project to collapse in this area in recent years. In 2008, Hunt Communities of El Paso decided not to buy 4,833 acres in Northeast El Paso from the El Paso Public Service Board to build a master-planned community with more than 14,000 homes. Hunt said the nation’s financial crisis prevented it from getting financing for the project.”

The Denver Post in Colorado. “The state’s chief regulators sought to defend their oversight of New Frontier Bank during a legislative hearing Wednesday, saying its $1 billion failure last year had nothing to do with poor regulation. Asked by state Rep. Joe Rice, chairman of the House Business Affairs and Labor Committee, what lessons are evident from New Frontier’s failure, acting banking Commissioner Fred Joseph suggested that the state could improve its monitoring of rapid growth.”

“The bank quadrupled its assets in less than three years, surging from $500 million in 2005 to $2 billion in 2007. ‘If that happens, we should require them to put more capital in the bank,’ Joseph said.”

“Greeley-based New Frontier was shut down in April by the state Banking Division because it was bleeding cash. The bank failure caused havoc in the agriculture and real-estate communities of northern Colorado. A Denver Post investigation published in December found that the state Banking Division under DORA failed to detect or punish potentially fraudulent accounting maneuvers by New Frontier managers.”

The Post Independent in Colorado. “The developer of a stalled condominium-hotel project in Basalt wants to overhaul the plan and build something more likely to secure financing in the current economic climate. A Chicago-based firm called Snow River Lodge Inc. wants to convert the condo-hotel project into a traditional hotel, representative Jim Richmond told Basalt officials in a recent meeting.”

“His company has approval to build 54 lodge rooms and two affordable housing units on vacant land. The project stalled 18 months ago after the concrete foundation was poured. The owners ‘lost financing’ during the recession, according to Basalt Assistant Planning Director James Lindt. Financing to build fractional ownership projects has nearly dried up, and loans for buyers of the units are virtually non-existent, according to sources in the real estate development industry.”

“The town planning department supports the change. ‘Staff feels that the request to convert the approved condominium hotel to a standard hotel will further the Town’s goal of creating a balanced economy and sustainable economic growth,’ a memo to the council said. ‘A standard hotel will better promote ‘hot beds’ and tourism than will a condominium hotel.’”

The Arizona Republic. “Arizona State University professor Karl Guntermann said preliminary data for December show the median price for a foreclosed home was down just 2 percent from December 2008. The index for non-foreclosed homes showed a very different trend in December, indicating that the Valley housing market continues to follow two distinct paths: one for bank-owned home sales and the other for more traditional sales.”

“The median sale price for non-foreclosures continued on a steady decline that barely has budged in more than a year. ‘By October 2008, non-foreclosures were declining at an annual rate of 20 percent, and they still are,’ Guntermann said.”

The East Valley Tribune in Arizona. “For the year, Phoenix-Mesa-Scottsdale ranked as the eighth-worst metropolitan area nationally in terms of foreclosure filings - default notices, auction sale notices and bank repossessions. In 2009, foreclosure filings were reported on 133,809 houses, or more than 8 percent of all houses, up 39 percent from 2008 and 343 percent from 2007.”

“The majority of foreclosures are not homeowners who can no longer afford their mortgages, but instead are unhappy because their mortgages are higher than the value of their homes, said Eric Bowlby, president of Amerifirst Financial in Mesa. ‘It may be their (mortgage interest) rate is adjusting and they can’t refinance and get on a fixed rate because they’re upside-down on the house, and that causes frustration and they get mad, and they just walk away,’ he said.”

Inside Tucson Business in Arizona. “Until jobs return and “we put people in foreclosed homes,” recovery of Southern Arizona’s real estate, home building and overall economy will lag behind most of the rest of the nation. The process will be slow and steady, with a full recovery not expected until late 2013 or early 2014. That was the sobering message from economist Marshall Vest of the University of Arizona speaking to about 300 otherwise upbeat attendees at the Tucson Association of Realtors Annual Forecast.”

“Vest said he could make a case that Arizona ‘is the nation’s hardest hit state.’ Arizona ranks last in job growth, 43rd in revenue growth, fourth in home foreclosures, and second in homeowners with negative equity. ‘Since the economy peaked in March 2007, Arizona has lost 275,000 jobs. Tucson has lost 26,000 jobs. The declines are just stunning,’ he said.”

“As this year’s president of the National Association of Realtors (NAR), Tucson Realtor Vicki Cox Golder’s ‘Washington Outlook’ is focused on reform and preservation. Because Congress has approved so many new programs, ‘we’re going to have some heavy-duty tax reform to pay for them,’ she said.”

“The national association is most concerned about preserving the mortgage interest deduction on homes. The Obama Administration views it as a new source of revenue for the government. ‘The deduction is the Holy Grail to anybody with a mortgage. We are going to fight this tooth and nail,’ Golder said.”

“Vest told the Realtors ‘we must put people in foreclosed homes before building more new ones.’ According to U.S. Postal Service officials, there are currently 25,000 vacant homes in the Tucson region.”

The Verde Independent in Arizona. “The latest version of Cottonwood’s proposed annexation master plan for 10-square miles of Arizona State Trust Land is starting to draw more compliments then the previous hail of ‘boos.’ The re-designed plan, according to Curt Johnson of consultant Coe and Van Loo, provides more open space and trails, a larger wildlife corridor and responds to local interests to give the entire development more variety and flexibility. The number of potential homes that might be built has been reduced from 23,000 identified in the last plan to a range of from 12,000 to 19,000.”

The Salt Lake Tribune in Utah. ” Home sales are up, but prices are still going down. That’s the focus of the Salt Lake Board of Realtors’ newest report out covering the housing market along the Wasatch Front. ‘It’s a tough time to be a seller,’ said Realtor Scott Colemere. ‘But with prices down and rates down and the government giving you money to buy, I don’t think there’s a better time to buy.’”

“Justin Lloret and wife Kristi have qualified for a federal home-buying incentive of $6,500, locked in at a mortgage rate of 5.5 percent and got a great deal on a 3,100-square-foot home on nearly one acre in Taylorsville they plan to close on within days. The couple had been looking for a for about a year and a half. ‘Compared to a couple of years ago, we got a really great price,’ Justin Lloret said.”

“Kelly and Elizabeth Callister plan to claim the $6,500 incentive. The Callisters sold their previous home in January 2009 and settled in the fall on their new home in Davis County, where they were able to buy at $15,000 below the already-low asking price for a newer house on a large lot. Kelly Callister said the home-buying incentive, lower prices and his 4.75 percent mortgage rate vastly outweighed the specter of more price declines.”

“‘It’s in the back of my mind, but this is our long-term home, this is where we want to be, so I’m OK with it. We’re thrilled.’”

“Home Savings Bank has until the end of March to increase its capital to at least 11 percent of assets, according to the Federal Deposit Insurance Corp. The order is part of a broader consent agreement between state and federal regulators and the bank requiring Home Savings to also cleanse its books of bad loans.”

“‘The FDIC and the Utah Department of Financial Institutions desires to have all banks increase their capital, reduce nonperforming loans and reduce their concentrations in commercial real estate loans,’ said John Sorensen, Home Savings president and chairman. ‘Recognizing the economic downturn, we took action.’”

“Right now, commercial real estate loans are 529 percent of the bank’s capital. The peak was 1,150 percent in 2006, when the housing slump began. Sorensen said the bank expects to reach its goal of 450 percent within six months. Because Home Federal would lend no more than 75 percent of a project’s value, the bank was comfortable with loan-to-value ratios that exceeded 1,000 percent of its capital. Other banks were willing to lend as much as 110 percent, Sorensen said.”

“With the collapse of real estate, that thinking has gone out the window, he said. ‘I would say I wouldn’t feel comfortable with that level now. It was a different environment,’ he said ‘So that 1,150 percent, that’s a different time. That’s a different era.’”

The Pahrump Valley Times in Nevada. “Lenders last week assumed ownership through foreclosure of a 20-acre tract of land where Jerry Wang, CEO of the Forum Group Ltd., had plans for an ambitious resort complex. There were no buyers at the trustee sale on the courthouse steps in Tonopah.”

“Wang planned to begin construction in January 2000. When the project was completed in five to seven years, Wang predicted 18,000 jobs would be created. His project, The Oasis at Shangri-la, would include an Oriental-themed hotel, casino, retail shopping complex, recreational vehicle park, convenience store and the St. Thomas Place condominium project, for which a sign stood for many years at the site. In November 1999, Wang told an audience of 200 people, ‘At least every other household will have something to do with this project.’”

The Reno News & Review in Nevada. “The unemployment rate in California stayed the same—12.4 percent—only because it did not reflect thousands who have dropped out of the job market altogether, meaning the figures do not reflect their numbers. ‘It hurts us,’ said Nevada economist Glen Atkinson. ‘We’re connected, totally connected to the California economy. … Some of our major sectors, including gaming, tourism and warehousing [are dependent on California’s economy].’”

“‘A lot of the construction industry here in the housing boom was highly correlated with what was going on in California,’ said economist Thomas Cargill. ‘In fact, a great many construction workers were from California, and one of the reasons why the labor force has declined is those people have packed their bags and gone somewhere else.’”

“‘Of the 30 biggest occupational categories in Northern Nevada, only 15 percent require a baccalaureate degree,’ Atkinson said. ‘It means we have a low-skilled labor force here. And it means that the people who go to university here, most of them will have to go someplace else for a good job. … There are not a lot of high-paying, high-skilled jobs in the region. … One of our big growing sectors has been retail, for example—you know, cashiers and so forth.’”

“‘Even though tourism’s been declining, we’re not growing enough in other industries—manufacturing, whatever—to make up for that,’ Atkinson said.”

“Nevada has always been something of an adjunct of California. The wealth of the state’s early mining booms was shipped to California. A former California governor was president of the second Nevada constitutional convention, which drafted the new constitution by using a copy of the California Constitution as a model. Since the revival of legal Nevada gambling in 1931, Californians have been the largest customer base of Nevada casinos.”

“But even now, with Nevada casinos losing customers to California tribal casinos, Nevada—particularly the populous south and west that contain most of the population—shares overlapping trade and media markets with California. The dependence of Nevada on California has been so pronounced that the late scholar Hal Rothman suggested that Nevada is in a colonial relationship to California. He noted that at Hoover Dam, Los Angeles Municipal Utility District vehicles have Nevada license plates.”

“‘The fundamental relationship between Nevada and California is as clear as the insignia on the side of these cars: California runs Nevada, so completely and brazenly the most needed resource in the desert state, water, is stored there for consumption in the great economic engine to the west,’ Rothman wrote in 2002 in a book of essays about Las Vegas—published by the University of California. ‘The control is so complete that the relationship seems natural: California entities wear Nevada license plates and no one notices, proof positive of the vast power of the Golden State in the Silver State. Nevadans need look no farther to see where their bread is buttered. … [D]esolate Nevada has survived by catering to the needs of outsiders, in particular Californians.’”

“When Nevada economic development officials last year started running ads touting the benefits of Californians moving their businesses to Nevada, Fresno Bee writer Jim Boren warned, ‘So here’s what you won’t hear in those ads: Nevada had the nation’s highest home foreclosure rate for the 31st-straight month. U-Haul dealerships in Nevada can hardly keep moving trucks on their lots as residents fishtail out of the once-booming state. Nevada casino revenues report double-digit revenue declines because of the sour economy and the beating they are taking from California’s Indian casinos. Nevada’s unemployment rate of 12 percent was fifth-worse in the nation—even worse than California’s 11.6 percent rate. … Readers know that I don’t defend California very often. State government is a mess. Our infrastructure is falling apart. We’re taxed every time we turn around. But in this comparison, Nevada is the competition, and California wins hands down. In fact, I’d double down on California’s economic future compared with Nevada.’”

It’s Friday desk clearing time for this blogger. “More than a million U.S. homeowners are expected to hand over their house keys in 2009, as they lose property to foreclosure. Judging by the increase in trustee’s sale notices, Bonner County has been swept up in this ugly national trend. Laura DeLand, a Realtor in Sandpoint said one client had a 10-acre property with a home and a barn on the market and couldn’t move it, despite a sizeable discount. ‘They owed $350,000 on it and I had it listed for $289,000,’ the Realtor said. ‘We still couldn’t sell it. The price spread is huge. You’re not talking about a difference of $20,000. You’re looking at $100,000 and up any more.’”

“‘I think the biggest share of these are people who got in and then the market changed,’ said Judie Bluemer, a mortgage consultant for Wells Fargo Home Mortgage. ‘They’re so upside down on their mortgages that they’re just walking away from them.’”

“New homes were springing up everywhere in 2005 and 2006. More than 1,400 new single family homes were built in those years, but far fewer, in the years following. ‘We saw a decline in 2006 –roughly 500 permits. This past year we dropped another 300 building permits so it’s probably just a reflection of the local building climate,’ said David Weir, Community Development director for the city of Las Cruces.”

“Residents said the slowdown has also hit their neighborhoods. ‘There’s no question the housing market has slowed down here. You can see that, but it’s nothing like the drops in California,’ said Vipin Gupta of Las Cruces’ east mesa.”

“Area home builders sold just 4,695 houses last year in El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties as an historic real estate collapse diverted thousands of buyers to steeply discounted bank repos, according to statistics being released today by the Folsom-based Gregory Group. Several builders filed for bankruptcy protection as repos climbed to two-thirds of Sacramento County sales, and the median sales price fell to $175,000.”

“‘There’s a lot of good-quality bank-repossessed properties, good, clean homes that would be in direct competition with the builders,’ said Warren Adams of Security Pacific Real Estate in Fair Oaks. Many are nearly new, he said. ‘I’ve had several listings where they’re still selling the models in there.’”

“Cemex, the largest cement manufacturer in the nation, plans to pull the plug on the Davenport plant and lay off the bulk of its local work force, about 125 employees, for a minimum of six months beginning March 9, company officials announced Thursday.”

“‘Demand does not exist right now in California,’ Cemex spokeswoman Jennifer Borgen said. ‘This closure is purely the market. If you don’t have demand, you can’t continue to produce cement.’”

“The problem of parties in foreclosed homes nearly turned deadly when a man was shot as he tried to attend a large gathering Saturday night, officials said. ‘The people didn’t want him there,’ said Sgt. Kurt Lackman of the Victorville station. ‘This is a very big problem. We get calls every day about trespassing or vandalism at these foreclosed home. Now they’re using them as hangouts and places to party.’”

“With so many vacant homes, Lackman warned, ‘It’s not going to get better anytime soon.’”

“Becoming a mortgage broker in Indiana used to be easy. Too easy. There were no background checks to weed out people convicted of financial crimes, no tests to see whether brokers had taken required classes and understood the complex mortgage world. A company simply had to plop down $200 to get its state license before brokers could start matching home buyers to lenders.”

“‘It was kind of like the wild, wild West out there,’ said Indiana Secretary of State Todd Rokita. ‘You came in, you paid a small fee and boom — you were a mortgage broker.’”

“Shirley Webster, who grew up in the area and owns a home there, says the empty homes attract crime and hurt efforts to rebuild. ‘When we have properties that are in foreclosure, they sit vacant for a long time,’ she said. ‘A lot of people have gotten into these properties that really could not afford it.’”

“Kansas City’s rental housing administrator Dan Schmelzinger was opening the mail one day recently when he was surprised to find an envelope containing a $200 check from Paris. Other checks have come from California, Utah, Arizona, Florida and Washington state. The money is starting to arrive from absentee landlords all over the country and even foreign countries as Kansas City has launched a new enforcement program aimed at owners of problem properties.”

“Jerry Mitchell, a resident and community liaison with the Ruskin Heights Homes Association, said that…his neighborhood…has absentee landlords from California, Alaska, Hawaii, Florida and elsewhere. He cited one example of an owner from Kansas who recently was compelled to clean up a yard filled with a tenant’s discarded belongings after receiving an administrative citation.”

“Driving through his neighborhood, he called the city to report another property in the 11200 block of Corrington Avenue owned by a California landlord. He said the owner started to renovate the property five or six months ago, but then threw a pile of belongings out at the curb and left several weeks ago.”

“The economy has been as tough on real-estate agents as the rest of the state’s workforce. Maine’s Realtors sold 22 percent fewer existing single-family homes in November, compared to the same month a year ago, according to the Maine Real Estate Information System. ‘The conservative lending habits of local banks kept the central Maine market stable,’ said Don Plourde, owner of Coldwell Banker Plourde Real Estate. ‘But we definitely saw folks who got in over their heads with the amount of debt they thought they could handle.’”

“‘We’re seeing 2008 as a better year than 2007, but inventory levels can go down when people don’t put their houses on the market if they’re afraid they won’t get a good price,’ he said.”

“Michael Byrne has a 30-year career in the business and has owned the agency since 1986. There are 20 agents at his firm. ‘Fortunately, we didn’t have the wild speculation other parts of the country did,’ he said. ‘We had more of a gentle landing, not that it didn’t hurt a little bit.’”

“Complete with an Oval Office and Lincoln Bedroom, the Atlanta White House became a symbol of developers reshaping the urban landscape by tearing down modest ranches and bungalows and plopping McMansions in their place. The religiously themed mini-White House – which required the razing of three brick ranches – is now up for sale, facing foreclosure this week if the builder, an Iranian-born entrepreneur, can’t get a $9.88 million selling price.”

“‘There’s an awareness now that some of the homes frankly are too big,’ says Scott Van Duzor, a home builder in Illinois’s Fox River Valley. ‘The McMansion has almost become embarrassing to some people.’”

“Bank of America Corp., GMAC LLC, and WL Ross & Co. are among mortgage servicers that have endured billions of dollars in unexpected costs and added thousands of workers to handle rising foreclosures, denting a business once viewed as a safe haven from the housing market’s collapse.”

“Analysts say billionaire Wilbur Ross, who made a fortune buying bankrupt companies, overpaid when his firm purchased American Home Mortgage Investment Corp.’s servicing unit for $500 million in October 2007 and Option One Mortgage Corp.’s servicing business from H&R Block Inc. for $1.3 billion in May.”

“‘It looked pretty cheap and everyone thought Wilbur was really jumping in at the right time, but it doesn’t look cheap today,’ said Rob Snow, former head of lending at E*Trade Financial Corp. ‘The performance of some of the American Home securities that they are servicing has been absolutely horrific.’”

“‘It’s like a snowball running downhill,’ said Bob Caruso, a former president of Bank of America’s mortgage company.”

“Vice President Dick Cheney said Thursday that…President George W. Bush has no need to apologize for not foreseeing the economic crisis. ‘I don’t think he needs to apologize. I think what he needed to do is take bold, aggressive action, and he has,’ Cheney said. ‘I don’t think anybody saw it coming.’”

“Here it is. The column you’ve been waiting for. The REALLY best award-winning news stories for 2008! Crime rate shows mixed figures: While murder rates were down in our fair city, crimes of dangerous text messaging and toilet papering of trees were significantly higher. ‘We plan to make a notable improvement in these areas,’ said a police department spokesperson. People text messaging, while break dancing, will find a significant increase in fines. Toilet paper will now only be sold at the register to those over 21 years of age. An ID will be required.’”

“City Council fights recession: Members of the City Council have decided to give employees a significant raise. When one city worker was asked what she will do with the money, the 20-year veteran replied: ‘Simple. I’m going to spend it at the Wal-Mart Supercenter in Stockton.’”

“Junior college plans bite the dust: It appears that our city will not be home to a new community college. The college district has an unfortunate shortage of funds due to the recession, higher wage costs, and trustees using private Citation jets for personal transportation. ‘It’s really no big deal,’ said one trustee. ‘Since there are no chain book stores in this town, we figure the people here can’t read anyway.’”

“Dancing mascot fired for indecent behavior: The dancing banana in front of Peppy’s Pistachio Ice Cream Parlor was fired for making obscene gestures with his costume. It seems that the banana’s sexist and crude behavior deeply offended the twisting tomatoes next door at Pete’s Pole-Dancing Palace.”

“Housing picture looking brighter: Reports from local real estate agents say now is the time to buy a new home. New loan programs, now available from the government, pay the homeowners’ mortgages for the next 30 years. To qualify, local residents only need to show that they have no jobs, incomes or assets. With inflation caused by legislative handouts, the average $180,000 home should cost $15.8 billion by the year 2038.”

The Sun News reports from New Mexico. “Kevin Romney has been trying to sell his house in Las Cruces since 2007. He believes he would have had an easier time moving the property had he put it on the market a little sooner. ‘We’ve had it on the market several times for about a year,’ the 54-year-old Las Crucen said. ‘We started selling ours right when everything was really starting to dip. We just got a late start on it.’”

“Real estate agent Gailen Hooper said different priced homes seem to selling at different rates. ‘The lower-priced homes are selling,’ he said. ‘It’s once you get up to $300,000 and $400,000, those are taking a while.’”

“Don Schroeder has a new house for sale on the East Mesa that he built with a partner. He said it’s been on the market for about six months. ‘It’s been slower than I would have hoped,’ he said.”

The Arizona Daily Sun. “Local homeowner Bill Cherry grew frustrated watching his home sit empty for more than nine months while it was on the market. His huge, sprawling house nearly sold twice last fall, but the deals fell through at the last moment. As snow began to descend on his empty driveway this winter, Cherry found himself regularly paying for a plow on the hope buyers might tour his home. ‘It is a little like hemorrhaging money,’ he said.”

“He turned to Matt and Ryian Brydenthal, a husband and wife Realtor team specializing in property management. Ryian said part of the demand for renting a home in Flagstaff is that it is cheaper on a monthly basis than purchasing.”

“‘They can rent a place, for instance, in Boulder Pointe for $1,650, where to purchase the same home in the high $300,000 to $400,000 range — their payments would be a lot higher,’ Ryian said.”

“For comparison, the average monthly mortgage payment for a $380,000 home with a 30-year loan at 6.5 percent interest would be $2,400. ‘People without a large down payment are able to get more house for their money if they choose to rent,’ Matt added.”

“For Cherry, his home is still listed for sale. He said he is unwilling slash the price of his home to force a sale. ‘I won’t have a fire sale,’ he said.”

The East Valley Tribune from Arizona. “Crashing home prices have sent dozens of units in a Scottsdale luxury loft development tumbling into foreclosure over the past year and a half. Since early 2007, lenders have foreclosed on 33 of the 84 units in downtown’s Third Avenue Lofts.”

“The project’s troubles mirror a Valleywide epidemic. Tens of thousands of properties have entered the foreclosure process this year with more than 3,000 actually being foreclosed on so far in June.”

“‘People were over their heads,’ Scottsdale real estate agent John Wake said.”

“Price drops at the lofts have been severe. In one case, a 905-square-foot unit was purchased for $369,277 in 2005, then resold a year later for $950,000, according to data from the Arizona Regional MLS. The property was eventually foreclosed on and sold in April for $289,900.”

The Arizona Republic. “A celebrity chef was planning the menus, brides were negotiating room rates and 250 staffers were on the payroll. But four months before Hotel Monroe was scheduled to open, its lender went bankrupt. It’s unclear what the future holds for the hotel and an entertainment district, two high-profile downtown Phoenix projects tangled in Mortgages Ltd.’s web of legal and financial woes.”

“‘This one hurt, bad,’ said Jonathan Vento, a principal at Grace Communities. The developer is also wrapping up construction on 44 Monroe, a 34-story condo tower a block away from the Hotel Monroe.”

“Developments that have ‘end users’ are easier to finance than housing, which involves more speculation, said Larry Lazarus, a veteran Valley development attorney working on the Jackson Street project.”

“Lazarus is also an example of how the Mortgages Ltd. debacle has permeated the region’s development circle. He invested in the firm, as did his parents, friends and some former clients, the lawyer says.”

“The economic slump has all but shut off the credit tap for many commercial projects, said Anthony Sanders a professor at Arizona State University. ‘I would love to see downtown Phoenix blossom,’ the professor said. ‘Right now, it’s not a sure thing that downtown Phoenix will be like downtown Manhattan.’”

The Review Journal from Nevada. “As a time clock set by Clark County runs down toward a Tuesday deadline for the Meridian Luxury Suites to cease short-term rentals, it appears the condo property is still taking overnight guests. The county says the Meridian is running an illegal hotel operation, and has ordered it to stop.”

“Two Meridian residents said the condo project is still operating as a resort, despite the county’s warnings. ‘It’s still renting. Bellmen are walking around and driving around. All the cleaning people are going unit to unit,’ Kathleen Mannix said.”

“Her permanent home is the Meridian unit she paid for in full before moving to Las Vegas in May 2007. Mannix said no one informed her at the time of her purchase that any of the units would be leased for periods of less than 31 days.”

“According to a county report, the Meridian has 678 units but only about 12 owners living in their units.”

“Most of the 50 or so people gathered May 18 around a Meridian swimming pool were short-term paying guests. Many praised the Meridian’s rates, which ranged from $119 to $169 for a two-bedroom ’suite,’ according to Kirk Wayne of Melbourne, Fla., who was in town for a convention.”

“But not all investors want the hotel operation halted. Las Vegan Ron Chapman, who with his wife owns two Meridian units, has contacted fellow owners by e-mail in support of the hotel, to urge them to protect their investments. Both his units are in the pool for short-term rental.”

“Chapman, a real-estate agent, also has clients who bought at the Meridian as an investment.”

“Almost 6 percent of the units at the Meridian are either in foreclosure, are being sold at foreclosure or are being sold ’short,’ said Michael Mackenzie, president of the Meridian Private Residences Homeowners Association.”

“The Meridian units are now worth only about 50 cents on the dollar, Mackenzie said.”

“In his e-mail, Chapman said the Meridian fell victim to the real estate downturn. ‘It’s no secret,’ he wrote, ‘that the Las Vegas real-estate market has given back most if not all of its gains, and that homeowners’ equity …. over the past two years, including Meridan’s, has vaporized.’”

“In another indication of economic hard times, Vestin Group’s two mortgage loan real estate investment trusts announced that they are suspending their dividends because of weak financial results. The two REITs, Vestin Realty Mortgage I and II, together have $393 million in assets and typically make short-term commercial mortgage loans to developers willing to pay double-digit interest rates.”

“Under law, the REITs must pay out 90 percent of their taxable income, but the announcement indicates that the REITs’ income is being reduced by nonperforming loans, loan write-downs and the expense of defending the company in lawsuits. Analysts say realty loan problems pervade the financial markets in Southern Nevada.”

“‘The whole entire country, real estate, is having a tough time,’ said Mike Shustek, CEO of Vestin Group. Shustek said he has been investing about $40,000 a week in Vestin shares and is increasing the amount to $50,000. Over the last year, he estimated he has invested more than $2 million in the shares.”

In Business Las Vegas from Nevada. “Las Vegas’ land market has crawled to a virtual standstill and prices continue to fall. Only two of 15 properties on the block at the June 17 Bureau of Land Management auction received offers, and the winning bids reflect how far the market has fallen.”

“Nava Properties paid $252,000 for 2.5 acres of residential land near Blue Diamond Road, a price of $100,800 per acre. The going price per acre in that area two years ago was $650,000, land analysts say.”

“Also near Blue Diamond Road, Phil Davis paid more than $1.9 million for five acres of commercial property. The $385,200 per acre is well below the market price two years ago when similar land would fetch more than $1 million an acre, said Craig Cherney, head of West Coast operations of American Land Fund, a private real estate acquisition fund.”

“‘It shows me the direction we are headed,’ Cherney says.”

“In May, one residential land sale is believed to be helping set the market. DBSI, an investment group, reportedly paid $289,000 per acre for 21.7 acres zoned for 15 units an acre in Providence, Focus Property Group’s master-planned community in north-west Las Vegas.”

“That’s a dramatic swing in prices - buyers were paying more than $750,000 to $850,000 two years ago, Cherney says.”

“There are even fewer deals in the pipeline now, says Derek Rafie, CB Richard Ellis’ first vice president.”

“The land market could be facing its own foreclosure problem just like the housing sec- tor, Rafie says. Property owners are negotiating with banks to delay payments or extensions, but banks are starting to take control of properties with the hope they can sell to foreign buyers, he says.

Property owners are arguing that the market is down, and banks should wait for it to improve to recoup money rather than take it over and try and dump it. Property owners are telling the banks they know their sites best.”

“But that argument may not be winning over lenders that appear ready to take back land and sell it to get it off their books, Rafie says.”

“The poor shape of the housing market will continue to wreak havoc with land sales, Rafie says. With concerns that housing foreclosures will continue to rise into 2009, that will dampen the need for raw land to build homes.”

“‘It has been extremely slow. The only buyers looking out there are those who can purchase it heavily discounted,’ Rafie says. ‘They are taking their time to see what’s going to happen in the market. They think, ‘Why buy now when it may go down more?’”

The Salt Lake Tribune from Utah. “Zions Bank now owns the 3,000-plus acre SunCrest project atop Draper’s Traverse Ridge. A judge late Thursday afternoon approved the bank’s $25.3 million bid for the bankrupt property despite a long list of concerns from an attorney who argued that the property could garner more cash and better repay its investors.”

“Though he acknowledged that the mountaintop project’s value has likely declined in the midst of a bad housing market, creditors’ attorney David Leta argued SunCrest had surely not lost $25 million over the six months since a December 2007 appraisal, which pegged the scenic property at $51.6 million.”

“SunCrest consultant Bruce Baird testified that a foreclosure sale could mean the SunCrest Clubhouse would never open, the SunCrest Market would close shop, and it could mean the demise of the entire mountaintop project.”

“The developer’s Dallas-based bankruptcy attorney Bill Wallander said nobody is pleased that the sale did not cover the debts, but he praised property marketer Gary Nelson’s 71-day effort to attract bidders. ”

“Zions does not plan to develop the property itself, said spokesman Rob Brough. ‘It’s likely to take a bit of time for that to happen,’ Brough said. ‘But now that the judge has ruled and the sale is final, our primary objective is to get it sold. We’d like to do that as quickly as we can.’”

The Denver Post reports from Colorado. “Andy Klein is a bargain shopper - on a huge scale. Since late last year, Klein has bought a few hundred lots for about half of what they sold for just two years ago. Klein is buying properties from banks and builders from as far north as Longmont and Brighton to as far south as Colorado Springs. ‘Homebuilders don’t want to hold inventory of platted lots or finished lots unless they believe they can be built on in the next three years,’ Klein said. ‘That leaves a lot of disposable inventory.’”

“The 10 largest public homebuilders reduced the number of lots in their inventory by 39 percent last year, according to the report by the real-estate investment arm of Deutsche Bank’s asset-management division. The majority of the decreases came from write-offs of land options.”

“‘There was a lot of speculative hoarding by homebuilders in the face of rapidly rising prices,’ said Robert Denk, an economist at the National Association of Homebuilders. ‘Now that it’s hit its height, it makes sense that a lot is going to get dumped at lower prices.’”

The Daily Planet from Colorado. “Wrap your head around this one. Right now in Telluride, real-estate sales volume is at its lowest point since 2003, and the number of properties changing hands has dipped to levels not seen since 1988. And yet, the average price of real estate has never been higher.”

“‘As much as we like to pretend that we’re recession-proof and believe that we’re recession-proof the national economy has an effect on us,’ said Lars Carlson, a broker with Peaks Real Estate.”

“And yet, home prices aren’t really budging.”

“‘Properties in this market do not lose value,’ said Judi Kiernan, owner of Telluride Consulting. ‘There’s a limited number we can’t make anymore. We’re not expanding like a Steamboat or Vail. I don’t want to sound like a Pollyanna, but the idea is, Is value falling? No, value is not falling. Expectations are being adjusted.’”

“Brokers say that buyers seem to be circling the airport right now, unsure about whether they should buy homes or wait another few months and hope they’ll be able to bargain sellers to a better deal.”

“‘Everyone’s trying to time the bottom of the market. They don’t want to be the guy who bought something and paid too much,’ said Matt Hintermeister, a broker with Peaks Real Estate.”

The Sun News from New Mexico. “Juan Arrendondo would like to own a house some day. The Las Cruces teacher, though, is engaged to be married and is not too sure a mortgage fits his life right now. ‘I do want to buy, but later,’ the 33-year-old New Mexico State grad said.”

“Arrendondo said he has researched a possible purchase but he and his fiancee have decided for now to rent a house near Roadrunner Parkway. The tightening of the credit market over the past year has caused him to delay taking on a mortgage, Arrendondo said. ‘Renting makes the most sense right now,’ he said.”

“Many are people who can’t afford to buy right now, thus houses also are taking longer to sell, said Cheryl Butler of Active Rentals. ‘I live on Topley (Avenue) and there are seven houses for sale within a two block radius,’ she said.”

“Jennifer Zappone of Landmark Real Estate said some builders have decided to put their homes up for rent while they try to sell them. ‘They’re trying to make the mortgage payment,’ she said.”

The Arizona Republic. “For decades, everyone assumed Arizona’s population-projection figures were reliable. Turns out they are not. Metropolitan Phoenix’s housing boom of 2003-06 skewed the state’s population numbers, leading to projections that planners, economists and government officials agree are inflated.”

“‘Population growth is the beginning of the food chain of Arizona’s economy,’ said Ioanna Morfessis, founding chief executive of the Greater Phoenix Economic Council. ‘But if the numbers are wrong, and I think the state’s population numbers are inflated, it’s going to be a house of cards for the economy.’”

“During the height of the boom in 2005, state and census estimates showed a record 196,000 people moved to the Phoenix area. But those projections, based largely on housing permits and occupancy numbers, didn’t accurately reflect how many people were moving to the Valley.”

“The large number of investor-owned properties inflated figures. And the number of building permits exceeded the number of houses actually sold. For example, a record 62,000 new homes went up in metro Phoenix during 2005 but only about 40,000 of those were bought by people who moved into them.”

“Jay Butler, director of realty studies at Arizona State University Polytechnic, says part of the current formula for projecting Arizona’s population assumes 1 to 2 percent of the state’s homes are vacant.”

“‘Now we know at least 10 percent of the new homes built during the boom were vacant, and foreclosures are leaving more homes empty,’ Butler said. ‘No one really knows how many homes are empty.’”

The Yuma Sun from Arizona. “The American Dream has become a nightmare for many Americans - Yumans among them - who got caught up in the real estate boom of a few years ago. ‘There’s more lower-end homes selling now,’ said Joe Wehrle, Yuma County Assessor. ‘We have a different picture. In the past, we had several upper-range homes sold. The top end just is not selling well.’”

“Michael Hall, broker for ERA Matt Fischer Realtor, said he thinks a better reflection of the market is a 20-25 percent drop in the average sales prices in the Yuma area in the past couple of years. ‘Prices have dropped in all the neighborhoods,’ he said.”

“With the inventory of homes on the resale market or being built, potential buyers have a lot of choices. Meanwhile, interest rates remain low and FHA loan levels have been raised to $271,050 through 2008.”

“‘That’s opened the door for anything under that price through the end of the year,’ said Hall. ‘There’s been so much negative media. But that’s national. Yuma is in a bubble.’”

The Daily News on Arizona. “Life hasn’t turned out to be a dream in the desert for the retired Queens man who moved to Arizona by cab along with his wife and two cats. Just months after Bob and Betty Matas last year made their cross-country trek and international headlines, Betty, 75, passed away.”

‘Now, Bob Matas, 74, says he can’t afford the payments on the house in upscale Sedona that the couple bought - and he’s moving into a trailer park.”

“The eccentric couple opted for a cab to Arizona in April 2007 in part because they wanted to start a promising chapter of their lives with an adventure. They also didn’t want to put their beloved cats through the ordeal of traveling in the cargo hold of a plane.”

“Matas said he recently consulted a lawyer because he was unable to get a loan. The value of his Sedona house at the foot of a mountain range had plummeted in the national housing market crisis.”

“His mortgage, credit card and other debts were substantial - his savings, modest. The lawyer urged Bob Matas to ‘walk away’ from his new home and let it slide into foreclosure, Matas said. He bought a $40,000 mobile home in a trailer park, also in Sedona, Matas said.”

“‘People are doing it all over the country,’ he said. ‘I never thought I would have to do it. It hurts, but what am I going to do.’”

“Matas doesn’t have an exact moving date. California transplant and friend Robin Briggman, who’s been helping Matas, said the move was unavoidable. ‘We looked at it from every angle,’ she said. ‘It’s just the way it is. It’s the bottom line. He’s off to the next chapter.’”

The Las Vegas Business Press from Nevada. “Vegas Grand, the local condominium complex in foreclosure, will finish construction next month. The 20-acre, 212-unit development is for sale. There is no official asking price.”

“‘We have been seeing strong interest in the property,’ said Geoffrey West, a first vice president with CB Richard Ellis. ‘This is the first fully completed vacant mid-rise condo project that has come to market.’”

“It cost $72 million to complete. There is also an adjacent undeveloped 16 acre tract, with entitlements for 782 more units. Its estimated value is $44 million, or $2.75 million per acre, which is 40 percent less than last year.”

“Lehman Bros. gained control of the project in October for $55 million, or $2.75 million-per-acre, after Orlando, Fla.-based developer Del American defaulted on its loan. The outstanding balance was reportedly between $90 million to $100 million.”

“Del American acquired the Vegas Grand property in May 2003 for about $4 million, or $200,000-per-acre. In 2004, the developer received $240 million in project financing from Lehman Bros. and Munich, Germany-based Hypo Real Estate Capital Corp.”

“At one time, about 90 percent of the project’s first phase…(which) started in the $200,000s, had been reserved. But Del American later canceled those reservations and raised prices by up to 50 percent due to market condition changes. It prompted a class-action lawsuit by buyers for breach of contract, fraud and deceptive trade practices.”

“Although the Vegas Grand was originally envisioned as luxury condos, the property is now expected to be used as apartments, time shares, student housing or hotel rooms. The project has been cleared of all encumbrances. The property is expected to be under contract by month’s end, with the deal closing by the third quarter.

“‘Although there is no official asking price, about $107 million has been spent on the development thus far,’ West said. ‘Unfortunately, we probably won’t recover every dollar from it due to the market conditions.’”

The Review Journal from Nevada. “Luxury homes in Las Vegas have held their value in a declining housing market in which one in every 44 homes has entered some stage of foreclosure, a local appraiser said. ‘I’m not so sure at $1 million, but at $1.5 million and up, it’s stronger today than it has ever been in this city,’ Scott Dugan of R. Scott Dugan Appraisal said.”

“The luxury segment from $1 million to $3 million is not looking quite as good, said Ken Lowman, broker and owner of Luxury Homes of Las Vegas. Sales dropped to 53 in the first quarter from 123 a year ago.”

“Homes that were valued at or near $1 million, including tract homes in upscale neighborhoods, have dropped back below the seven-figure threshold, resulting in fewer luxury sales, Lowman said.”

“Steve Hawks of ReMax Platinum said the luxury housing market is about to be butchered in the ‘million-dollar massacre.’”

“He said so-called ‘jumbo loans’ have all but dried up because of the massive amount of mortgage fraud that found Las Vegas at the center of an FBI investigation. Jumbo rates have increased by a point or two and the borrower has to put down 15 percent to 25 percent, Hawks said.”

“Homes with artificially inflated values are now going into foreclosure or short sale, Hawks said.”

“‘We’re in the first inning of the million-dollar market plunge,’ he said. ‘We see some examples already. Several guard-gated communities that have a high amount of vacant homes, short sales and bank-owned (homes) are starting to pop up slowly.’”

“The hardest-hit sector will be semicustom homes in guard-gated communities, Hawks said. Homes in those areas that were going for $1 million to $1.5 million are now listed for $600,000 to $800,000 and will probably drop to $500,000 or $600,000, he said.”

“Though not as prevalent as they are in the lower markets, ‘mortgage walkers’ are letting banks take back high-end homes, Hawks said. His partner has a Seven Hills foreclosure home in escrow for $750,000 that was once valued at $1.4 million.”

Las Vegas Now from Nevada. “Our community’s foreclosure crisis has many parts, some of which are only coming to light with the passage of time. With banks now owning so many homes, local realtors say they aren’t moving fast enough when it comes to selling property banks admit they don’t want to own in the first place.”

“When Karen Reffner got divorced and lost her job due to an illness, she was convinced she was going to lose the home she had lived in for the past nine years.”

“‘I spent all these years putting my heart into it, and it’s gone. Sorry. I had a lot of good times, but when you spend every day and night working and doing all of this, it is very hard,’ she said.”

“So Reffner moved into a rental home and started working with a realtor to sell her home in what is called a short sale. She was hoping to convince her lender, Bank of America, to accept less than the loan amount in exchange for a quick sale.”

“The problem is Reffner says it was next to impossible to get any kind of answer from the bank, ‘At that point, we did not have any contact person. It goes in a pile. When the things come in, it just goes in a pile. They did not know how to work with it and they’ve even told me this is all new to us.’”

“Bill Uffelman represents the banking industry in Nevada, ‘We’re certainly not in the property management business.’”

“He says banks themselves are in unfamiliar territory and are actively working to adapt to today’s market conditions. ‘They are shifting staff, shifting resources. It becomes a re-training, re-direction. You’ve got staff so can we do something to make it better? And this is literally a developing process,’ he said.”

“Gail Selter, Karen Reffner’s realtor, says she’s seeing signs that some of the bigger lenders are slowly adapting, but the frustrations are ongoing.”

“‘They will say, ‘We’ll call you back in two business days,’ and they don’t. And then we have to get back on the phone with them. So it’s an aggravating part of our business to have to be able to maintain a log and keep on top of them,’ she said.”

“Selter says delays have caused two potential buyers to walk from this short sale and for every day that passes without a sale, Reffner says her credit, and her spirit, is taking a beating.”

“‘It is to the point where I am so tired of dealing with it, I just want to go on with my life,’ she said.”

It’s Friday desk clearing time for this blogger, “The most severe real estate recession in decades appears far from over, with the pace of foreclosures rising, the fall in home prices accelerating and the pain spreading to nearly every major U.S. city, according to two reports. Gary Sweredoski, a Realtor in Myrtle Beach, S.C., is behind on his own mortgage and facing possible foreclosure. He’s also sought bankruptcy protection.”

“‘I’m a real estate broker, and my business just died,’ says Sweredoski.”

“I decided to take a look at Greenwich, CT, one of my favorite enclaves of multi, multi-million-dollar homes. Existing home sales in Greenwich are down 37.5 percent in March from a year ago and prices are down 13.7 percent. What’s even more disturbing, given the median income of the typical Greenwich homeowner, the number of Greenwich foreclosures in March was twice what it was a year ago.”

“If Greenwich is falling, perhaps the super-rich are not so immune to this housing crash as we’ve been saying all along.”

“Moving to a 55-and-older condominium community was supposed to make life easier, Richard Greig said. ‘This was supposed to be our retirement dream. We were going to come here and we wouldn’t have to mow the lawn or shovel snow,’ Greig said.”

“Instead, Greig and other residents of two incomplete developments in Litchfield, have been left to scramble through the financial and legal wreckage of a housing market gone sour and an allegedly bankrupt developer with a history of legal entanglements.”

“‘There’s nobody that lives here that’s happy that they purchased here at this point,’ Greig said. ‘But we’re stuck here now.’”

“‘I’m not the only developer out there having a tough time right now, it’s a tough market,’ said Richard C. Berube of Londonderry. ‘The bank is part of the problem. The real estate market is part of the problem. I’m probably part of the problem.’”

“The nationwide housing slump isn’t keeping adventurous single women like Roxanne Williams from buying homes in the Victor Valley. ‘There’s no point in me paying rent and I want security for myself and my children,’ said Williams.”

“‘I have probably 10 single moms at my office out of 60 Realtors and they’re all buying homes,’ said Caroll Yule, a broker and president of the Victor Valley Association of Realtors.”

“After years that saw developments sprout up faster than rooms could be sold, Center City’s high-rise boom seems to be slowing. Projects have been quietly canceled or delayed, and with a glut of units on the market, more and more realtors see at least a temporary slowdown in the works.”

“Alan Domb, whose real estate company owns high-rise condo buildings including the Parc Rittenhouse, said it could take as long as two years for the market to regain its footing. ‘If you haven’t started a project, and you’re thinking of starting in this environment, you have a better chance of seeing God,’ Mr. Domb said.”

“Prices in the Bay Area and Los Angeles are about where they were in August 2004. Hard-hit Detroit has retreated to its August 1999 level. Seattle, on the other hand, is back where it was July 2006. The 20-city Case-Shiller home price index is now roughly where it was in January 2005, about 3 1/3 years ago.”

“Let’s not forget that in the second half of 2004, prices in Las Vegas were soaring 50 percent on a year-over-year basis. Anyone who thought that would go on forever spent too much time in the desert sun.”

“Billionaires Warren Buffett and Charlie Munger say the pain many financial institutions are feeling because of the credit crunch is well deserved. (They) said that the financial companies that engineered subprime mortgages and the investment funds backed by those mortgages don’t deserve much sympathy as they record losses now.”

“Munger said lots of financial institutions acted with stupidity and overreached to improve earnings in recent years. ‘I think you have to start with the idea that a lot of the current troubles are richly deserved,’ Munger said.”

“Steve O’Conner, chief lobbyist of the Mortgage Bankers Association, said, like many before him have said, ‘We are clearly in extraordinary times. This is the greatest housing crisis in the country since the Great Depression.’”

“O’Connor answered a question about relief for lenders by saying: ‘Nobody’s going to bail out lenders. There is zero sympathy for lenders. I know because I go up there (to Capitol Hill) every day.’”

“American International Group Inc. shares were under pressure Friday morning, retreating after the blue-chip insurer reported a quarterly loss of nearly $8 billion triggered by huge write-downs on credit investments gone sour. The results were driven by a $9.11 billion write-down on a credit derivatives portfolio and $6.09 billion of net realized losses from AIG’s investment portfolio.”

“‘Although we expected that AIG would have some losses in the first quarter, the level of the additional losses exceeds these expectations,’ S&P credit analyst Rodney Clark said. Fitch Ratings downgraded the firm too.”

“Fremont General Corp, which is selling assets after regulators ordered it last year to stop subprime mortgage lending, on Friday said it may file for bankruptcy protection.”

“Economist Mark Zandi says the nearly nine million homeowners with negative equity are particularly vulnerable in this weak economy.”

“‘These folks are in big negative equity positions. If there is any disruption to their income at all, they have a major problem. And disruption to income doesn’t mean what it used to. Disruption to income ten years ago meant death, divorce or major disability. Disruption of income now means, well, I have to replace two tires (on my car), or my water heater broke,’ he said.”

“What was once a red hot market has softened and the number of homes on the market has jumped. ‘Sales are much lower than in the past three years,’ said Donnie Brainard of Alameda Property Group. ‘Las Cruces hit a high and now we’re hovering at the bottom edge of a cycle.’”

“There are more than three times as many homes on the market this year than four years ago. The first quarter of 2004 saw 474 listings while this year there were 1,593. ‘We’re still seeing tons of interest from California and places like Wisconsin,’ said Rick Stoes, managing director of the Grubb & Ellis office in Las Cruces. ‘I think we’re still ahead of the nation.’”

“Oklahoma City’s market conditions are not as bad as they are in many areas of the country, Oklahoma City Realtor Faith Thomason said. Thomason said, ‘It is a buyer’s market, even in Oklahoma City, because we have so much inventory.’ For example, she said that in just the southwest area of Edmond, there are more than 200 new homes on the market.”

“‘Don’t get anchored to a price,’ she said. If a neighbor’s house sold for $180,000 last year, that doesn’t mean that you can reasonably expect your home to fetch the same price.”

“According to Southern Oregon MLS figures, 288 existing homes sold in the rolling quarter that ended April 30, a decline of 33 percent compared to the corresponding three months in 2007. Broker Vic Nicolescu says one in four sales during the rapid-fire sellers’ heyday earlier this decade were to people who have since flooded the market with inventory.”

“‘A quarter of the sales in 2004 and 2005 were to speculators and investors with no intention of occupying the property they bought,’ Nicolescu says. ‘It should be obvious to everyone that we’re in for at least another year of a buyer’s market. Buyers can be very picky and sellers are going to get their brains beat in.’”

“‘These are tough economic times,’ said Mayor Antonio Villaraigosa. ‘The fact is a lot of economists, a lot smarter than I am, didn’t see this coming. A year ago, no one expected us to have the problems we are to the extent we are.’”

“‘The No.1 issue on the minds of voters is the economy,’ said David Fleming, president of the Economic Alliance. ‘We have an economist at the L.A. chamber who four years ago predicted the housing bubble would burst. We have seen prices decline by 20 percent, … and they could go down another 20 percent.’”

“I’ll admit it: When home prices were soaring in my neighborhood, it made me feel really smart. As the years went by, and all of us on the block could count our home appreciation month by month, all this paper equity made us feel financially secure as in, ‘Now we know how we’re going to pay our college tuition bills down the road.’”

“But as they say, easy come, easy go. Home prices in our neck of the woods have been falling just as they’ve been falling around the country.”

“The huge drop in home equity has spooked home sellers. Foreclosure rates have skyrocketed, hitting new records. Banks are still taking weeks and weeks and weeks to parse offers from prospective buyers. Buyers are getting fed up and are moving on to make other low-ball offers.”

“Fighting through all this to get a deal done is like wading through Jell-O. Just ask any real estate agent who hasn’t torn his or her hair out yet.”

“If the news isn’t bad enough, I’ve been hearing from readers around the country who are in shock that their home equity lines of credit have been shut off. This is what a stuck housing market looks like. Nobody feels that smart anymore.”

Some housing bubble news from Washington and the empty houses across the US. Bloomberg, “A record 18.6 million U.S. homes stood empty in the first quarter as lenders took possession of a growing number of properties in foreclosure. The figure is 5.7 percent higher than a year ago, when 17.6 million properties were vacant, the U.S. Census Bureau said in a report today. The vacancy rate, the share of homes empty and for sale, rose to 2.9 percent, the highest in a series that goes back to 1956.”

“About 2.3 million empty homes were for sale, compared with 2.2 million a year earlier, the report said. In addition to homes for sale, the report counted 4.1 million vacant homes that are for rent and 4.7 million that are seasonal.”

“Most foreclosures are contained in the report’s ‘other’ category, which includes homes tied up in legal proceedings as well as homes that are empty because the owner is renovating and living somewhere else, according to the Census Web site. There were 7.5 million such homes that were vacant, up from 7.3 million a year earlier, the report said.”

The Associated Press. “The national vacancy rate, including new and existing homes, has been steadily rising since mid-2005. ‘The inventory problem has not gotten any better,’ said economist Patrick Newport. Although glut-fighting home builders have reined in construction, ‘they still will have to cut back more.’”

From MarketWatch. “Families are no more likely to own their home now than they were in 2002, even with the big effort to push families with poor credit into homeownership through subprime mortgages. The percentage of homes occupied by owners ticked up to 67.9% from 67.7%, after peaking at 69.2% in 2004.”

“‘Given tight lending standards and foreclosures, we expect the homeownership rate will continue to edge lower,’ wrote Michele Meyer, an economist for Lehman Bros.’”

“The vacancy rate rose to…about 1 million more than was typical before the housing bubble burst. Analysts say the housing market won’t recover until the glut of vacant homes on the market can be worked down.”

“‘There is clearly still substantial excess housing supply that will take time to work off,’ wrote economists for Goldman Sachs. ‘We think it unlikely that prices begin to stabilize until vacancy rates start declining.’”

The St Petersburg Times from Florida. “Five hundred people turned out for the (condominium) groundbreaking in 2005, complete with spotlights, valets and a sand sculpture of the towers-to-be. All 257 units in these two 29-story towers were snatched up in 13 days, before ground was even broken.”

“But alas, this is Florida, where another boom has busted. Two-thirds of the buyers have backed out. Deals have been shredded, lawsuits filed. The developer sought bankruptcy protection after the fallout.”

“That left Johnny Foens, who kept his promise and moved into the middle of a city of 318,000 in a county of 1.1-million, in a region of 2.7-million, and found himself living in a tower nearly alone.”

“‘We’d really like to meet some couples,’ says Johnny’s girlfriend, Amanda, ‘but there’s nobody here to meet.’”

The Star Tribune from Minnesota. “The three dozen residents of the Sexton are scattered widely among the mostly vacant 123 units in the downtown Minneapolis condominium building.”

“In some cases, unit sales at the Sexton mirror the boom and bust of the condo market. One unit sold in August 2006 for $620,000 with no down payment, according to property records. It went into foreclosure nine months later and most recently was listed for sale at $109,900.”

“Its reputation as a troubled project is widely known, said Tom Melchior, a multifamily analyst. ‘[The Sexton] doesn’t come up in conversations very often, but when it does, the comment usually is something like ‘That place is really a mess,’ Melchior said.”

The News & Observer from North Carolina. “The Triangle’s traditionally robust spring home selling season began with a whimper. One problem is a rising inventory of speculative homes, those built without a buyer lined up.”

“Although overall sales are down, builders keep adding to the market glut by churning out higher-priced homes. There were 4,753 spec homes on the market in March. That’s up nearly 12 percent from a year earlier.”

“Average spec home prices were $608,822 in Orange, $434,810 in Wake, $289,091 in Durham and $249,213 in Johnston. ‘A whole lot of builders were committed to build on lots and built homes even though they had to know the market was adjusting,’ said Ross Rhudy, general manager of Ammons Pittman GMAC Real Estate. ‘A lot are gambling their house will be the one to sell.’”

The Denver Post from Colorado. “Birds fly, fish swim, and even during sharp downturns in housing, builders keep building. The result: a glut of homes on the market, an urgency for homebuilders to get the homes sold, and deals for buyers.”

“DR Horton’s Raspberry Hill community in Weld County stands alone on a prairie, just east of Interstate 25. A few dozen homes have been built and sold there, and 200 more are planned in a second-phase build-out. Sales brochures at the site advertise ‘rock bottom pricing’ of $249,900 to $299,900.”

“The ‘Wilson’ model home, with 3,114 square feet and four bedrooms, previously was $402,714, according to the builder. It is now listed at $299,000.”

“Price declines are a signal to stop thinking of homes strictly as investments, said broker Jennifer Gore. ‘Someone asked me when we would know the market had truly improved. I said, ‘When you no longer see incentives offered in advertising in the paper.’”

The Northwest Herald from Illinois. “Once part of the housing boom, McHenry County is feeling the effects of the national housing bust. The county saw a ‘very large decrease’ in the number of home sales in the last quarter of 2007, according to County Assessor Donna Mayberry.”

“‘We have a lot of supply right now,’ said Jim Haisler of the McHenry County Association of Realtors, ‘and we don’t have the demand.’”

“When Neumann Homes declared bankruptcy in October, large projects were left unfinished – or not even touched – in Wonder Lake, Lakemoor and Gilberts. ‘Nothing lasts forever. The boom was not going to last forever,’ Mayberry said.”

The Detroit News from Michigan. “Metro Detroit’s dismal residential housing market — gridlocked and stagnant amid a global mortgage loan crisis, consumer sentiment at a 26-year low and a glut of unsold and foreclosed homes — has cast a pall over local builders who only a few years ago were enjoying boom times.”

“Now, half-built subdivisions dot the region, construction workers are fleeing south and companies from family-owned shops to global firms like Pulte Homes Inc. are bracing for what could be their worst year yet.”

“Said Centex spokesman Eric Bruner: ‘We are in the middle of the worst housing market in modern history.’”

“In 2007, a paltry 5,556 permits to build new homes were filed in the nine counties that make up southeastern Michigan, according to Clawson-based Housing Consultants Inc. That was nearly half the number of permits filed in 2006 and 20,994 less than in 2004, the best year this decade.”

“Stalled subdivisions abound, a boon for companies such as Pinnacle Homes of Farmington Hills, which step in to buy unfinished subdivisions from banks and attempt to build homes for much less than just a few years ago.”

“‘I knew the market well enough to know that this was an overall downturn and one that was going to be around for a while,’ said Pinnacle executive, Howard Fingeroot, standing amid the empty lots of Kirkway Estates in Lyon Township. ‘The only way to compete with the foreclosures was to get closer to their prices.’”

“In a venture with AmTrust Bank of Cleveland, Pinnacle will build 85 houses in the 100-lot development. The homes will be from 2,800 to 3,400 square feet and will list for around $330,000, Fingeroot said.”

“The 15 homes already standing, he added, sold for more than $450,000 each just a few years ago. ‘There are still plenty of people who want to buy, and now is the time,’ Fingeroot said.”

From KFOX Las Cruces in New Mexico. “With several unsold homes on the market, builders are paying the price. ‘I think they’re going to slow down and let everything catch up. Builders aren’t building as much so it will all catch up and be fine,’ said Sean Vick, builder with From the Ground Up Design.”

“He hopes to move his homes off the market quicker. ‘It’s tough we have three houses on the ground right now for sale,’ said Vick.’

“But there’s a ray of hope. The Las Cruces Home Builders Association’s spring showcase of homes debuted this weekend inviting potential buyers.”

“‘We come from California so it’s a very different kind of real estate market. The prices here you can buy three homes for what you have to pay for one out there,’ said Dorothy Overhiser a new Las Cruces resident.”

“The Overhisers said that their four-bedroom, four-bathroom California condo, overlooking the ocean, was on the market for more than six months, but selling looks more promising in Las Cruces.”

“‘I think the market is bottoming out. This market right here wasn’t really strong to begin with. It just had good steady growth that when it backed off it didn’t back off too far,’ said Charles Overhiser.”

“Builders said they welcome anything that can help the market turn. ‘It’s an opportunity to stimulate the economy. Somebody can get bargain prices on real nice homes,’ said Michael Clifford with Team Builders.”

The New Jersey Herald. “Home foreclosures are soaring in Sussex County and throughout New Jersey, according to sobering 10-year figures provided by the state Office of Banking and Insurance.”

“Foreclosures filings in Sussex County rose by 44 percent from 2006 to 2007, and increased by 46 percent statewide. Total filings had hovered around the upper 400s and mid-500s from 1997 to 2005, before vaulting to 620 in 2006 and 892 in 2008.”

“Home prices are down about 25 percent from their the market peak in about June 2005, according to Bob Brandon of Weichert Realtors in Landing.”

“He chalks it up to a plague of overbuilding and a lack of arms-length transactions, sales in which people are ready and willing to use the home. ‘Houses never leave the market,’ he said. ‘There are too many houses and not enough buyers.’”

“Also, he said, some appraisers skewed their work to the whim of the banks and provided appraisals ‘that are way out of whack.’”

“More than ever, Sussex County residents in need of work are reeling from the specter of a foreclosure on their home, said Bill Weightman, director of the state’s job center in Franklin. ‘I’ve had men and women cry in here. This is the American Dream going south, and I don’t think it’s coming back,’ he said.”

“Several years ago, ‘Michelle’ and her mother had a successful business and acres of property in Sparta, a township known for its affluence and quality of life. But it all spiraled downward last May, when Michelle was let go. The lay-off was sudden, she said.”

“Now Michelle and her mother, who asked that their real names and other specifics of their lives not be printed, are struggling to pay their $5,500-a-month mortgage payments, not to mention buy food or the gas or bus fare needed to get to job interviews.”

“‘Nobody wants to lose their home,’ she said. ‘It’s not a beautiful mansion, but this is my mom’s hard work for many years. We don’t want to end up on the street, getting that call, ‘By the way, you can start packing.’”

“People heading toward a legal battle for their home can opt for a pre-foreclosure sale to recoup some money instead of nothing. Brandon, who has been in the real estate business for 40 years, advises them to talk to a broker, get the right price on their house and get rid of it.”

“Ben Bensley, of Andover Township, said he attends the sheriff’s sales to gauge the market, but he’s not about to bid. ‘If the price is here and the market value is here,’ said Bensley, moving his hand from high to low, ‘then why buy it? I’d say 95 percent (of the properties), if not more, go back to the bank.’”

“Mike Callanan, of East Amwell, represents numerous banks’ interests as a part-time job in Sussex and the surrounding counties. He, too, acknowledged, ‘There are no bargains.’”

The Rio Rancho Observer reports from New Mexico. “According to realtor Cari Barlow with Sunland Realty in Rio Rancho, the housing market is returning to what it was before the big upward rise in prices Rio Rancho experienced several years ago. ‘For those two years it was a seller’s market,’ Barlow said. ‘But, it is back to being what it had always been: a buyer’s market.’”

“Sunland Realty is encouraging house sellers to consider leasing their property until they find the right candidate, who wants to buy. ‘Sellers can’t afford to keep them on the market,’ Barlow said. ‘Renters can lease until they sell.’”

“Residential land has mostly been divided into small lots, which is how developers wanted it from the beginning. ‘Developers bought it and sold the land as postage-size lots,’ explains Scotty Scott, working for the same real estate office. ‘Carpetbaggers drove the market up. And, now, they are driving the market down.’”

“Scott says 100,000 acres have already been sold there, but there is between 65,000 and 75,000 acres still available for sale at Rio Rancho Estates. Upper-end lots can go as high as $125,000 per half-acre, while if you go outside the Rio Rancho city limits, land can run as low as $3,000 per acre.”

“Molly Kraft from Pulte Homes thinks it is a great time for the market, and that buyers sitting on the fence waiting for changes either way should go out and buy.”

“‘It will not get any worse,’ Kraft says, ‘or any better for the buyer.’”

“Karen Gauze with Desert West Properties, explains that because we don’t having the housing boom we had 18 or 24 months ago, there is no reason to consider that Rio Rancho is still not a good market. ‘Investors are looking for long-time investments now, rather than a fast flip,’ Gauze said.”

The Las Cruces Sun News from New Mexico. “The value of property in Doña Ana County has nearly doubled since the 2000 tax year ‘The main reason why our tax base has been increasing so much has been due to new construction added to the tax base,’ said Doña Ana County Assessor Gary Pérez. ‘The base also changes and increases because of an increase in market value for existing homes.’”

“A decrease in residential construction is expected to be felt this year, however, and will be reflected in 2009’s taxable value. In 2007…nearly 600 fewer building permits were issued by the city of Las Cruces than in 2006.”

“‘2006 was a banner year,’ Pérez said. ‘I think there’s going to be a little bit less of an increase this year.’”

“But Pérez said he does not expect the value of property to actually decline. ‘The Las Cruces area will still increase in value,’ he said. ‘It may not be as high as other years, but it’ll be higher than the national average. We’re still booming, we’re still a desirable area.’”

The Arizona Republic. “Charles DeWitt hadn’t planned to stop last week at the abandoned house on South Williams Street. DeWitt had other work in mind, a list of complaints about shabby properties in the area he patrols as a Mesa code compliance supervisor. But en route, the small ranch house caught his eye. Weeds were almost hip-high and a side gate stood ajar.”

“DeWitt called City Hall to check on the property, and in short order his suspicions were confirmed. Another foreclosure had hit home in Mesa. The people living here had just walked away, leaving a mess, an unpaid $400 city electric bill and an eyesore for neighbors struggling to maintain their own property values.”

“‘It’s actually been an issue that we’ve been tracking over the last 18 months,’ said said Mike Renshaw, who runs the code compliance team. Since prices peaked, the collapse of the subprime mortgage market and falling real estate values have plunged millions of homeowners and real estate investors into financial hot water.”

“A Web site lists more than 3,600 distressed properties, either bank-owned or heading for auction in Mesa. The problem is citywide, Renshaw said.”

“‘I think, unfortunately, it runs from east to west,’ he said. ‘It’s obviously gotten much worse over the past few months.’”

“DeWitt pointed out several apartment buildings along Elton Avenue that are either in foreclosure or on the brink. One eight-unit building has one occupied apartment. Investors bought many such properties during the 2005 boom, DeWitt said, but now they can’t collect enough rent to cover mortgage payments or repairs.”

“‘The crime rate in these neighborhoods is just astronomical,’ DeWitt said.”

“Single-family investment homes have been hit, too. As an example, DeWitt pointed to an empty house on South Forest Street, purchased by an out-of-state investor in 2005. Trashed by previous tenants, the house needs repairs the owner can’t afford for the amount of rent she can charge.”

The Arizona Daily Star. “A developer is planning to use a live auction to sell nine new homes in a Green Valley subdivision. Mark Hughes, owner of Hughes Development, will use that method to sell some of the homes in Las Campanas Village, a retiree-oriented community.”

“Three of the nine homes will be sold ‘absolute’ — that is, no matter how low the winning bids are.”

“The homes previously were listed in the $250,000 range. The developer said he has 27 unsold homes in the subdivision that have been sitting on the market for about nine months.”

“Hughes said he’s taking an experimental approach to ‘kind of see where the market is.’ ‘They just need to be sold,’ he said.”

“Green Valley saw a huge upswing in investor activity about two years ago, rapidly driving up prices, said Steve Smith, president of the Green Valley Association of Realtors. Now, there is ‘just too much on the market,’ he said.”

“Hughes said builders ‘just couldn’t keep up with the demand’ during the boom years. But sometime last year, the market ‘came to a screeching halt’ in Green Valley.”

The Green Valley News & Sun from Arizona. “Hughes says the housing market ’slowed’ in 2006 and ’stopped’ in 2007. ‘I’ve built 12,000 homes over 15 years in the Phoenix Valley and Tucson-area, and this is the first time I’ve had to start auctioning,’ Hughes said.”

“‘Obviously, we’re seeing falling prices in a falling market. We know what these homes are worth, but if the public’s not willing to buy at that price, it doesn’t matter,’ he said.”

The Arizona Capital Times. “Home foreclosures have skyrocketed, gas prices have spiked, unemployment has risen and the stock market has teetered like a drunkard. Sara Wedeman, an economic psychologist, said consumers are feeling frightened by the negative reports about the housing and credit markets, which leads them to be cynical about the likelihood of a quick recovery.”

“‘Fear-mongering of any type tends to cause people to hunker down and not invest and circle the wagons,’ she said. ‘That’s the worst thing for the economy.’”

“Doug Clark has witnessed the psychological impact that a sour economy can have on potential homebuyers. As a real estate broker, he has had many clients balk at buying houses in reaction to news reports about a struggling housing market, opting instead to wait to purchase the property at the best possible price.”

“‘Sometimes, I think it’s a self-fulfilling prophecy,’ said Clark, who is also a Republican state representative from Anthem. ‘If buyers would just buy the house, (the market) would turn around.’”

“Even more frustrating, he said, is that delaying a purchase by a few weeks will lead to minimal saving for the buyer. Stalling for a month or two may result in only a $5,000 savings on a $300,000 house.”

“‘Unless you are a flipper, a house value isn’t going to change that much in two weeks that it’s going to impact you negatively,’ he said.”

“Wedeman said that irrationality is a hallmark of economics, in both good and bad times…even if the clichéd mantra of ‘buy low, sell high,’ is the logical course of action. That irrationality is on full display in the scenario Clark mentioned, she said.”

“‘The risk that they might lose $5,000 is nothing compared to the fact that they will buy a house at a great price that will rise in value,’ Wedeman said. ‘It’s that refusal to take a risk that makes this cycle perpetuate itself.’”

“Clark said he expected the housing slump to be over by now. ‘Instead of coming out of it, we’re actually worse than we were a year ago,’ he said, estimating client traffic at his firm is down about 75 percent from last March.”

“Elliott Pollack, a Scottsdale-based economist, said the credit crunch means about 25 percent of potential homebuyers can’t qualify for loans now. The oversupply is so acute that it could take more than three years for the excess homes to be absorbed and the market to return to its equilibrium, Pollack said.”

“The supply of homes listed for sale in the Phoenix area will take up to 18 months to dry up. Tucson has enough homes for sale to keep buyers busy for the next 12 months.”

“‘The only thing the government could do (to fix it) is go out and buy 1.7 million homes and blow them up to restore supply and demand,’ Pollack said. ‘In the absence of that, we simply have to live through it.’”

“Arizona had the fourth-highest foreclosure rate in the nation in February, according to RealtyTrac. The 9,540 foreclosures for the month were a 210-percent jump from the prior year.”

“The housing market is the cornerstone for what University of Arizona economist Marshall Vest calls the ‘growth industry’ that employs 20 percent of the state’s workforce: construction, mortgage lending, title companies, home inspectors, architects, landscapers and the like.”

“‘They’re all downsizing, consolidating at this point,’ he said.”

“Vest said the same psychology that is now creating a negative pull on the market is also the same thing that will help the economy recover. After all, he said, part of the reason for the situation we’re in now was the market-induced frenzy of home buying.”

“‘At a point, the psychology will turn and people will decide they can afford a house now,’ he said. ‘You’ll find it’s like a light switch. After all, Arizona’s the state where growth is good and too much is just right.’?”

The Review Journal from Nevada. “Median existing-home prices have fallen to $237,000, below the $240,000 threshold that local housing analysts predicted would be the low point. Las Vegas made national headlines again this week with a 19 percent decline in the January Standard & Poor’s/Case-Shiller index, tied with Miami for the biggest drop among 20 cities measured in the index.”

“New-home sales in Las Vegas are down 49 percent for the first two months of the year, existing-home sales are off 37 percent and home building permits have plunged 70 percent, housing analyst Dennis Smith said at Las Vegas Housing Outlook 2008.”

“‘Obviously we’ve got tight credit and qualifying requirements,’ Smith said. ‘Those are factors, too. I could go on and on. I think we’re close to the bottom, but it’s going to be an extended bottom.’”

“‘It almost couldn’t get any worse. I hate to say that,’ Bernard Markstein, director of forecasting and analysis for the National Home Builders Association, said at forum. ‘The tough times are not over, but we may be reaching the bottom. Of course, affordability remains an issue, but prices are starting to adjust.’”

“‘What’s going to get us out of this? Demand needs to stabilize and improve before there is a recovery,’ he said. ‘Again, we’re talking about a modest rebound. We don’t want to get back to 2004.’”

From KVBC.com in Nevada. “Nearly half of all the resale homes being sold in southern Nevada are foreclosures, but analysts believe the worst of the housing slump may be over.”

“‘Now it’s not going to happen overnight, we’re going to be at the bottom for a while, but at least it’s stopped going down,’ Home Builders Research President, Dennis Smith, said.”

“‘I can’t tell you when the prices are going to stop going down, but right now they’re as low as they’re going to get,’ Smith said.”

“Las Vegas-based SalesTraq reported a median existing home price of $250,000 in February, down 13.2 percent from the same month a year ago. That followed a 14.1 percent decline in January.”

“SalesTraq President Larry Murphy said he was doing research on the housing market in Pahrump, about 50 miles southwest of Las Vegas, and found stories from 2004 about how land prices had doubled and developers were selling more lots in three months than they had in the previous 10 years.”

“‘It gave me pause to think here we are four years later and it’s hard to believe the attitude and mind-set of everybody back then, that it would last forever and you’d better get on the bandwagon,’ Murphy said. ‘Four years later it’s doom and gloom and we feel like this is going to last forever. We’re just in these real estate cycles. What’s it going to be like four years from now?’”

The Associated Press on Nevada. “In Las Vegas alone, nearly half the homes currently on the market have seen their prices reduced at least once, according to an analysis by ZipRealty.”

“Greg and Barbara Abbott have already cut the price twice on the two-bedroom condominium they are trying to sell on the Las Vegas strip. They’re asking $669,900 now — and an offer in the $650,000 range means they’ll lose money.”

“Abbott thinks hesitant buyers don’t realize how reasonable the current price is. ‘They’re not really being realistic about what the place is worth,’ he said.”

“His broker, Bruce Hiatt said there was no shortage of interested buyers — but none had decided to buy. ‘They’re all waiting for the magic bottom,’ he said.”

“Abbott, the condo owner in Las Vegas, is asking a monthly rent of $2,300, down from the $3,500 he had originally wanted. ‘It’s empty at the moment,’ Abbott said. ‘We’d intended to rent it, but the timing, of course, was bad.’”

The Gazette reports from Colorado. “Colorado Springs’ housing market suffered through one of its worst downturns in recent memory during 2007. Foreclosures broke a 19-year-old record, home construction slowed to a pace not seen since the early 1990s. And as foreclosed homes come on the market, they’ll continue to create competition for builders and the resale market, where prices already have declined during the past few months.”

“Several parties, not just lenders, are to blame for the mortgage woes, said El Paso County Public Trustee Carol Snyder. Homebuilders, real estate agents and mortgage brokers all eagerly worked to sell homes, she said, while many buyers bought too much home for their budgets.”

“‘You put a larger housing stock with all of the creative financing, and all the eager people at all ends of the spectrum, and you end up in the situation we are in now,’ Snyder said.”

The Rocky Mountain News from Colorado. “The final tally of foreclosure filings in the seven-county Denver area in 2007 represent a 41.5 percent increase over the record filings in 2006. Last year’s 26,326 filings were the equivalent of every home in Littleton and Louisville going into foreclosure.”

“In August, Broker Brian Bartlett started tracking the number of us foreclosures in Denver’s MLS, and found the percentage increases had doubled by the end of the year. At first, about 6 percent of the homes listed for sale were either owned by lenders or the Departmentof Housing and Urban Development and 13 percent of the sold and closed homes were foreclosures.”

“Now, those numbers have risen to 13 percent and 26 percent, respectively.”

“‘That is consistent with the raw data you have on foreclosures,’ Bartlett said. ‘Every week and every month, the numbers have gone up. And that may be under-counting it, because some lenders will not allow the listing agent to put the home in the MLS as a lender-owned.’”

The Daily Times from New Mexico. “If being spotlighted on NBC’s ‘Today Show’ were not a big enough deal, the Farmington and San Juan County real estate market was highlighted Monday by the National Association of Realtors as one of the top 10 fastest-growing places in the country.”

“During November…homes in San Juan County sold for median prices between $200,000 and $275,000, according to Elizabeth Tafoya, incoming president of San Juan County’s Board of Realtors. ‘We’re not artificially inflated, and we have affordable housing,’ Tafoya said. ‘We have some foreclosures, but they’re mostly in the manufactured home market.’”

“The housing market ‘went out of control’ even in the state’s metro areas, and took a hard fall, Tafoya said.”

“In light of the roller coaster ride that has been the national home real estate market in recent months, outgoing Board of Realtors President Rosemary Hart hopes local buyers and sellers will learn a lesson.”

“‘News about the foreclosures, lending crisis and decreases in value nationally gave us an unnecessary scare here, but didn’t really affect us,’ Hart said. ‘But people panicked and we saw a decrease in sales. Other than what I call the panic stage,’ we’ve had steady sales.’”

“Her advice to people considering buying or selling here this year is to do their homework, but make sure it’s homework that’s based on the local real estate market. ‘Stay focused in your location when you get educated,’ Hart said. ‘The house you’re buying or selling isn’t in Las Cruces or Roswell.’”

The Sun News from New Mexico. “After a red-hot pace in 2006, the Las Cruces real estate market took a slight step backward in 2007. About 2,400 homes sold in 2006, while slightly less than 2,000 sold this year, according to statistics from the MLS compiled by Kaye Miller of Steinborn Realty.”

“‘There are more homes on the market,’ Miller said. ‘It might take longer to sell, but the homes are eventually selling. It’s a little bit of a tougher market; there’s more on the market and sellers have to be aware that they have to price it right. They have to be a little more patient.’”

“Stacey Melzer sold her Las Cruces home in 2007, but it was on the market for more than six months. ‘I did not think it would take (so) long,’ she told the Sun-News after one deal fell through because a contingent sale did not pan out.”

“Eventually the house sold, but she had to make two mortgage payments for a while, she said.”

“Miller said the national real estate market affects Las Cruces because it is taking out-of-towners longer to sell their homes in other markets and delaying the purchase of homes here.”

“‘We are so lucky here because we are sort of in this little bubble,’ she said. ‘Other areas across the country are hurting so badly. It’s impacting us because people who buy a lot of these homes have to come in from other places.’”

The Arizona Republic. “Two years after Scottsdale’s real estate market started to cool from its red-hot run-up, the big question for 2008 remains whether the market has hit bottom.”

“Optimists among local real estate professionals think it has and the new year will see improvement. ‘We’re on the other side of the dip,’ said Janine Brown, Scottsdale Area Association of Realtors president.”

“A Greater Phoenix Blue Chip panel of economists noted that new-home permits fell to about 32,000 in the Valley this year, about half the totals of two years ago and will drop to 30,000 in 2008.”

“Scottsdale Realtor Mark Tait said the softer market is motivating sellers to price their homes more reasonably and do improvements that they were not willing to do when multiple offers were rolling in on homes a few years ago.”

“And back when people were camping out to pay $190,000 for 15-year-old condo conversions.”

“‘They realize it is a buyers market and prices have retracted,’ Tait said.”

“People in real estate and construction are fighting to hold on until the market improves. ‘Builders are selling finished lots for 20 cents on the dollar just to stay afloat,’ he said, adding that as many as two-thirds of the smaller builders will not survive.”

“There should be some good indicators of where the Scottsdale market is headed by the second quarter of 2008, Tait added. ‘When is the bottom? Nobody can answer that,’ he said. ‘The bottom is when the media starts writing all kinds of good stories.’”

“Thanks to recently passed federal legislation, getting out from under mortgages with a short sale is easier in the troubled Southeast Valley real estate market.”

“Nick Martini of Mesa may be one Southeast Valley homeowner who gets a break from the new law. In 2005, Martini and his wife bought a house in Mesa and owe $315,000 on it now. The couple has completely remodeled the home’s interior, but currently it would probably sell for $280,000, said Martini.”

“In November, Martini was laid off and said he is now working a lower-paying job. And, his wife is five months pregnant with the couple’s second child. They struggle to make their house payments now, he said.”

“‘Come April, we’re going to fall on our face,’ he said. ‘We’d like to keep our house. Basically, we need to make more money.’”

“Should the Martinis short-sell their house, they won’t be alone. Randy Kutz, co-owner of Phoenix Heritage Real Estate Group and Arizona Short Sale Experts, said his companies have 60 short-sale listings around the Valley, and they aren’t going away anytime soon.”

“Even if the Valley’s housing inventory is reduced, Kutz said many portions of the region are down to 2004 prices. ‘I think the short-sale situation is going to be with us for five-plus years,’ he said.”

The Mohave Daily News from Nevada. “Some Southern California investors in The Hoover Companies projects are claiming they’re not getting the money they invested returned to them when they request it.”

“The Hoover Companies owns the golf course, country club and master-planned community of El Rio in Mohave Valley. They also own the future master-planned community of Mariposa, across the highway from El Rio.”

“The El Rio development, which has been taking shape since 2005, has fallen on hard times like its cousin to the north - Laughlin Ranch - due to the sharp downturn in home sales. Only three residences at El Rio are occupied, according to Hoover spokesman Chaz Martinez.”

“Other signs of trouble for El Rio include the fact that its clubhouse restaurant has scaled back its hours, no longer serving dinner. The nearby El Rio Professional Plaza, completed this year, has so far attracted only three tenants. And the Mariposa housing project, adjacent to El Rio, lays idle.”

“In an attempt to encourage development, Hoover is offering homes at El Rio with 1,300 square feet starting at $189,000, built on lots discounted at 40 percent and priced at $49,000.”

“‘I’m proud of this because I don’t think other developers have been willing to do what we do in this horrible market,’ Martinez said. ‘I mean, some developers just go bankrupt. They’re not paying anybody back. We would never want to do that. I mean, we’re fighting this gloomy period just like everyone else. We have tried to think outside the box to spur economic growth.’”

The Reno Gazette Journal. “A trying time, these past 12 months were for Northern Nevada’s economy. At the forefront: The housing market whose downfall was, by most accounts, inevitable after the runup some years back. Even the once-hot condominium market has cooled, as some downtown Reno projects have been halted.”

“‘Even McDonald’s will be affected,’ said Tom Cargill, economist at the University of Nevada, Reno. ‘People will have less money to spend. That’s real. There’s a sense of feeling less wealthy.’”

“Ken Wiseman, broker/owner of Reno Rancho Realty, recalls the heady times of a few years ago when homes sold furiously, sometimes in a matter of hours. Those days now are just memories.”

“‘We’ve finally seen the 180-degree turnaround,’ he said. ‘The bubble has burst.’”

“Added Wayne Capurro, incoming president of the Reno-Sparks Association of Realtors, ‘It was not unexpected, but it certainly feels worse once you’re in it. It got so overheated.’”

“”Cargill said society has bought into the myth that home prices will always go up.”

“‘That’s simply not true,’ he said. ‘But this is not a catastrophe. It’s normal to have ups and downs. Business cycles are a natural part of the economy. It’s a myth to think that these things can be made to go away. This was true 300 years ago, and it’s true today.’”

“Observers apply a positive twist to the real estate spinout by saying lower prices can be a good thing.”

“‘Our market was inflated. It got out of reach for the average wage earner,’ Wiseman said. ‘Businesses won’t move here if it’s not affordable. It needed an adjustment. What goes up, comes down. We’re going to see it go back to 2003 prices.’”

“Nationally, sales of new homes last month sank to the lowest level in a dozen years, and sales of new homes in Washoe County showed an even worse downturn than the national figures.”

“Locally, the November 2006 to November 2007 figures showed new-home sales crashing by 64 percent in Reno and more than 60 percent in Sparks and countywide.”

“‘The numbers show the housing showdown is real and is showing no signs of getting better at this point,’ said Brian Kaiser, an analyst at the University of Nevada, Reno.”

“He said looking at a full year of data, Washoe County shows at least a 40 percent decrease in new and existing home sales. ‘It’s my feeling we haven’t seen the bottom yet,’ he said. ‘If you look at the foreclosure data, there’s a dramatic increase in 2007.’”

“Those homes become inventory in the real estate market. They’ll be offered at cut-rate prices and will be competing with existing and new home sales. ‘I wouldn’t be surprised if 2008 is another bad year like 2007,’ Kaiser said.”

“Eugenio Aleman, senior economist at Wells Fargo Bank, told a business conference in Minden earlier this month that the Reno area’s housing industry might make a comeback by the end of 2008.”

“‘Reno is going to come back stronger than Las Vegas,’ Aleman said. Aleman expects California’s recovery to take longer.”

“Sonny Amendola, managing broker for Century 21 Goldcrest Properties in Reno, said the real estate market locally has bottomed out. ‘We’ll see for sure if this market is going to turn around in April, May, June, when people put their houses on the markets,’ Amendola said. ‘It just went up way too fast, way too quick.’”

“Prices have dropped by about 30 percent and he’s not sure how much more they can drop.”

“Part of the equation, though, is California, where many people who move to Nevada have to sell their homes first. ‘California always has an impact on Nevada, just because of the sheer number of people who live there,’ Amendola said. ‘When California rebounds, that will affect us, too.’”

The Dallas Morning News reports from Texas. “The Dallas-Fort Worth area joined the long list of U.S. cities with falling home prices in a new nationwide survey. The D-FW third-quarter decline was worse than the nationwide 2 percent drop in pre-owned home sales prices, the real estate trade group said.”

“Dr. Jim Gaines, an economist with Texas A&M University’s Real Estate Center, said he’s not surprised that the Dallas market is trailing the rest of the state. ‘We’ve acknowledged for some time that the D-FW market has been the weakest of the major Texas metro markets with considerable overhang in the new homes and lately in the existing home inventory of houses for sale,’ Dr. Gaines said.”

“Dallas housing analyst Ted Wilson said he wasn’t overly concerned about the Realtors’ new report. ‘I don’t think we are way out of whack,’ Mr. Wilson said. ‘The expectation is that a lot of this excess inventory will get cleaned up in the spring.’”

The American Statesman from Texas. “Sales of existing homes in Central Texas declined in October for the fifth straight month. Sales of single-family homes were down 15.4 percent compared with October 2006 and were off 6 percent for the year to date, according to the latest figures from the Austin Board of Realtors.”

“September has experienced the steepest monthly decline this year; sales plunged almost 24 percent from a year earlier. And with pending sales down 19 percent in October, November could also see a decline.”

“Though sales are off from a record-breaking 2006, experts say Central Texas’ housing market is still in relatively good shape. But it hasn’t escaped the ripple effects of the national subprime problems.”

“‘I think the (housing) market is reflecting the overall view of the national housing market, with a wait-and-see approach,’ said David Taughinbaugh, a senior VP at Prosperity Bank’s downtown branch. ‘Buyers are on hold right now. They’re waiting to see how the market fares when the buying season resumes after the first of the year.’”

“Cheryl Middleman, owner of Austin Confidential Real Estate Services Inc., sees how the market has shifted. ‘A year ago, I had nothing but buyers, and now I have mostly sellers,’ she said, and most of them are builders trying to sell their new homes.”

“Among her listings is a 1,667-square-foot home in Austin’s Northwest Hills that she, her husband and a contractor remodeled. ‘It’s a phenomenal location, and we get a lot of activity,’ she said of the house.”

“But it’s not selling.”

“The house was listed Oct. 1 for $342,000. Since then, Middleman has dropped the price twice, first to $339,000 and then ‘drastically’ a week ago to $319,000.”

“With few listings in that neighborhood, homes usually sell fast. ‘There are qualified buyers out there. I just don’t think they’re making a move in this market,’ Middleman said.”

The Express News from Texas. “The number of new housing starts dropped 27 percent since last September as builders try to correct the oversupply of new homes on the San Antonio market.”

“And although it’s a painful time in the home building industry, with most builders laying off workers this year, the industry is taking the needed steps to right the market, said Jack Inselmann, vice president of Metrostudy’s U.S. Central Division.”

“‘We still have our work cut out for us with finished inventory,’ Inselmann said.”

“There are currently 2,980 new, vacant homes for sale — good news for house hunters searching for a good deal or discount, though not so great for builders. Builders all year have been trying to shake off an overabundance of homes built in 2006. Many of those homes were started for out-of-state investors who backed out of contracts upon the discovery that San Antonio’s new-home market rarely turns a quick profit for buy-and-flip investors.”

“For the first several months of 2007, builders of entry-level homes were hit the hardest by both the oversupply of homes and problems in the mortgage lending market.”

“But for the first time in the third quarter, the slowdown has started hitting the upper-end market — those homes priced more than $300,000, Inselmann said.”

“The slowing market simply took longer to reach that segment because those homes take longer to build. ‘Those numbers are hitting their peak. It was going to get there eventually,’ Inselmann said. ‘Every segment gets touched.’”

“Along with new homes, the number of vacant, developed lots has climbed to 27,040, the highest level in 10 years. And 10,000 lots were under development at the end of the third quarter, according to Metrostudy.”

“While it takes as little as three to four months to build a home, developing a lot takes about 18 months, developer Norman Dugas said. ‘There’s a lot longer lead time and construction time,’ he said. ‘When the spigot turns off, we can’t stop the lot delivery as quickly. The builders can stop building faster then we can stop developing.’”

The Houston Chronicle from Texas. “Single-family home sales in the Houston area fell 7.9 percent in October from the same period last year, the Houston Association of Realtors reported Tuesday. That’s about half the 16.4 percent decline between September 2006 and 2007.”

“Rob Cook, chairman of the association, noted that the woes in the lending market have helped put potential buyers on the sidelines. ‘The people who would have bought are renting, and some have dropped their price and said, ‘I can’t buy this, so I’ll buy this,’ Cook said.”

“Midrange homes, where most of the sales last month occurred, saw the steepest declines. That’s possibly because of foreclosure activity, said Karen Derr of Karen Derr & Associates Realty.”

“‘It was easier to get a loan in that price range,’ Derr said.”

“Lenders in recent years have been more lax and offered exotic mortgages that often ended up in default, sending the subprime mortgage market into turmoil. ‘Those foreclosures are still hitting the market,’ Derr said.”

“Some of the October statistics show the slowdown will likely continue. The number of pending sales at the end of last month were down 6.6 percent, compared with the same month last year, according to the realty association.”

The Houston Business Journal from Texas. “The Houston real estate market is on pace for its second-best year on record with recent declines in home sales slowing in October.”

“‘The Houston real estate market is likely to experience continued weakness as the residual effects of the mortgage industry credit crunch filter through the system through the end of the year,’ said HAR chairman Rob Cook. ‘If you look at the overall year picture, we’re only modestly behind the absolute record year of 2006 and are ahead of 2005, which was a banner year.’”

The Sun News from New Mexico. “Yes, the real estate market has cooled off in the past year. Yes, all the news about the subprime mortgage mess has sent some shocks through the national economy. And yes, fewer building permits have been issued in Las Cruces as of late.”

“But members of the Las Cruces real estate and business community want buyers and sellers to know that all is not lost. In fact, now is a good time to buy a house, they said.”

“‘We’re in good shape,’ said real estate professional Gary Sandler in Las Cruces. ‘Things are slow, yes, that’s part of the cycle.’”

“Sandler said that, just since August of 2006, the number of homes on the market has jumped significantly. ‘We don’t have enough buyers,’ he said.”

“Michele Marshall, executive director of the Las Cruces Home Builders Association said that the number of building permits has fallen. ‘In September of 2006, there were 144 single family permits in the city,’ she said. ‘Right now, there are 43.’”

“Steve Vierck, president and CEO of the Mesilla Valley Economic Development Alliance, said that whenever the housing market slumps, a wide variety of people are affected.”

“‘If things slow down, we think immediately of construction workers, contractors, real estate agents and others that are directly impacted,’ he said. ‘But it affects a much broader range than those individuals. Think about yourself, if you bought a home and what you buy after you buy a home, if you reduce demand for those goods and services. Think about people who sell furniture and wall paintings and landscaping and title companies and insurance companies.’”

“Marshall said the news from her national organization has been encouraging. ‘They keep telling us that the downturn in the housing market is not having a huge impact yet on the economy,’ she said. ‘Now is a real good time to buy a home.’”

“Sandler said that some people do not realize that loans are available. Some of the more exotic-style loans have been stopped, he said, but home buyers can still get mortgages.”

“‘Media reports are influencing buyers and sellers,’ he said. ‘Buyers and sellers think that mortgage money is scarce. It’s not. Mortgage money for flaky people is scarce. But mortgage money for everybody else is great.’”