Las Vegas, Nevada is widely regarded as the foreclosure capital of the United States. With nearly one out of every sixty household filing for or on pace for foreclosure, Las Vegas is experience a foreclosure rate seven times higher than the national average. This makes Las Vegas the most housing strained city (of more than 200,000 residents) in the United States. Presently, almost one third of Las Vegas mortgage holders are listed as delinquent.
The rampant amount of foreclosures are drastically pressuring down Las Vegas housing prices. In fact, two thirds of all home re-sales were through foreclosures. In December 2009, it was reported that the median price paid for a home in October 2009 was only $130,000, down from $196,000 a year earlier. This was the lowest point for median sale since April 1999 when the median price paid for a home was $129,000.
The high foreclosure rate and low sales point is making it almost impossible for existing homeowners and residential developers to sell their homes. It is estimated that 65% of homeowners owe more on their mortgage than their home is actually worth, this is much worse than the national average of 25%.
To make matters worse, the Las Vegas unemployment rate is expected to remain high; as such an abnormally high percentage of Las Vegas employment is based around the travel and entertainment industry. Until the general economy picks up and the Las Vegas unemployment rate drops, it’s unforeseeable for the Las Vegas foreclosure rate to decrease.