Underwater homeowners are continuing to put their houses up for short sale even though the economy has seen vast improvement since the big housing bubble burst.
Short Sale May Be an Option
A short sale occurs when a homeowner puts his or her home on the market at a price that is below the amount that he or she owes on the property. Short sales are sometimes necessary when a homeowner needs to move from the property but does not have enough money to pay off the remaining debt on the home. A Nevada short sale is also an option to avoid foreclosure. It is estimated that approximately 20 percent of borrowers owe more than their homes are worth. A short sale attorney can review the options that may be available to homeowners and provide information about the advantages and disadvantages of pursuing a short sale.
Abandoned Properties on the Rise
The number of abandoned properties has also steadily increased despite the improved economy. Many homes are boarded up in an attempt to keep squatters at bay and to help prevent vandals from causing damage. As of early June, 97 homes had been boarded up during the fiscal year in the city, compared with 117 for the entire year and the average of 30 per year that was common before the recession occurred. Many of these abandoned properties are bank owned as a result of a failed short sale or foreclosure.
Concern Over New Housing Bubble
Other factors in the economy also give rise to concerns regarding the Las Vegas real estate market. Underwater homes and a large number of investor-owned rentals could subject the market to a new housing bubble. Limited availability and increased demand are heating up the already hot housing market and area home prices continue to rise. Las Vegas is currently the most overheated housing market in the nation, according to Finch Ratings.
The last housing bubble in Las Vegas occurred in 2013 after housing prices rose by 30 percent year after year because investors were purchasing houses in bulk. This growth rate was well over the average three to five percent annual rate of growth. When the bubble burst, properties that were valued at $200,000 would sometimes sell for $50,000. Those concerned about a housing bubble are concerned that property owners could be holding onto properties with inflated values.