Rising unemployment placed downward pressure on real estate market

Loss of jobs, as well as the decrease in demand, placed downward pressure on Las Vegas real estate market, this according to Applied Analysis, a Las Vegas business advisory firm.

With the rising unemployment, Las Vegas leads the nation in foreclosure. 

The Greater Las Vegas Association of Realtors reported that 20,613 homes in Las Vegas, including foreclosures and short sales, are active or pending with offers. Industry observer Applied Analysis; meanwhile, reported that there are only 13,028 homes available for sale in Las Vegas.

According to Department of Employment, Training and Rehabilitation Chief Economist Bill Anderson, in the state of Nevada, 83,700 individuals lost their jobs over the year. Anderson said that in Las Vegas Metropolitan area alone, 60,000 individuals lost their jobs.

Anderson added that unemployment rate in June in Southern Nevada reached 12.3 percent, or nearly times two to the number in the previous year. Anderson said this marks the highest rate of unemployment in the history of Clark County. He said the sectors of construction and hospitality have been affected the most.

Applied Analysis reported that the rising unemployment and diminished demand pushed the apartment occupancy rate to an all-time low of 90.5 percent.

According to Whitney Tilson, principal of New York-based investment firm T2 Partners, the next wave of foreclosures will come from prime loans. Tilson said homeowners-borrowers will default on their loans due to job losses. Tilson added that the decline in home prices which left one-fourth of homeowners nationwide underwater–when the amount owed exceeds the current value of the home– will also drive homeowners-borrowers to default.

Data aggregator RealtyTrac reported that over 6 percent of the homes in Nevada; that is, one in every 16 homes received at least one foreclosure filing in the first half of 2009. RealtyTrac said close to 69,000 homes in Nevada received a foreclosure filing from January to June. This was a steep rise by 23 percent from the previous six months and an increase of 61 percent from the first half of 2008, the data aggregator said.