Las Vegas Housing-Market Conditions

Las Vegas Housing-Market Conditions The Center for Business and Economic Research Las Vegas Housing Market Searching for Bottom Volume 56, 3rd The national housing market was beset with problems in third quarter. Foreclosures were up over second quarter. 1 One in 139 housing units was filed for foreclosure in third quarter. That figure compares with 1 in 144 for second quarter and 1 in 138 for first quarter. Meanwhile, sales of new residential-housing units in third quarter were down 12.5 percent from second quarter on a seasonally adjusted basis. 2 The Las Vegas area housing market continues to search for bottom as the area struggles with historically high unemployment rates. The Las Vegas metropolitan area saw a slight increase in foreclosures during third quarter, to retain a substantial lead in foreclosures over other U.S. metropolitan areas. In the Las Vegas metropolitan area, 1 in 25 residences were posted for foreclosure during third quarter, which was more than five times the national average. Other metropolitan areas in the top ten included Cape Coral-Fort Myers, FL; Modesto, CA; Stockton, CA: Merced, CA; Riverside-San Bernardino-Ontario, CA; Miami-Fort Lauderdale-Pompano Beach, FL; Phoenix-Mesa-Scottsdale, AZ; Bakersfield, CA; and Vallejo-Fairfield, CA with foreclosure rates that ranged from 1 in 35 to 1 in 44. Reno- Sparks was 12 th with a foreclosure rate of 1 in 50, and nearby Los Angeles was 40 th with a foreclosure rate of 1 in 90. Las Vegas also remained the top metropolitan area in the nation with negative equity mortgages. In the Las Vegas area, 71.1 percent of the area s mortgage properties were underwater in third quarter, down slightly from the second quarter figure of 72.8 percent. 3 Another 3.7 percent are near negative equity. Other statistics also add to the perception that the Las Vegas housing market still had not found bottom in third quarter. The Case-Shiller Home Price Index for the Las Vegas metropolitan area dropped in third quarter after being nearly flat since fourth quarter. CBER estimates an excess housing supply of 12,630 in the Las Vegas metropolitan area for third quarter an increase of 32 percent from the second quarter estimate (Table 1). Apartment vacancies ticked up from 10.4 in second quarter to 10.8 percent in third quarter. Residential-building permits continue to fall. Stephen P. A. Brown, PhD Table 1 Estimated Excess Supply of Housing Units in the Greater Las Vegas Area by Housing Type: Q3 Type of Housing Unit 1 Vacant Units Estimated Units in the Greater Las Vegas Area Single-family detached 12,280 468,976 1.5 7,035 5,245 Condominium 3,499 82,089 3.5 2,873 626 Townhouse 1,105 38,626 2.0 773 332 Apartment 15,669 145,336 6.4 9,242 6,427 Total 32,553 735,027 2.8 19,922 12,630 1 Excludes mobile homes and multiplex units 2 Estimated excess supply = vacant units less estimated normal vacancy inventory Assumed Percent Normal Vacancy Rate Estimated Normal Vacant Inventory Estimated Excess Supply 2 I RealtyTrac (www.realtytrac.com) 2 U.S. Census (http://www.census.gov/const/www/newressalesindex.html) 3 CoreLogic (http://www.corelogic.com/) Las Vegas Housing-Market Conditions, Volume 56, 3rd

Housing-Market Overview Permits Issued in Clark County by Type of Unit 1 2,500 2,000 1,500 1,000 500 0 3rd Total: 1,754 4th Total: 1,225 1st Total: 1,934 2nd Total: 1,644 3rd Total: 1,090 Commercial Units 67 57 63 69 58 Multifamily Units 379 204 314 273 28 Single-Family Units 1,308 964 1,557 1,302 1,004 Residential-Building Permits All Types of Unit Permits Issued by Issuing Authority 1 900 800 700 600 500 400 300 200 100 0 3rd Total: 1,687 4th Total: 1,168 1st Total: 1,871 2nd Total: 1,575 3rd Total: 1,032 Uninc. Clark County 763 532 828 654 467 City of Las Vegas 264 289 510 461 199 City of North Las Vegas 174 134 201 204 145 Henderson 440 190 279 203 171 Boulder City 3 4 2 0 0 Mesquite 43 19 51 53 50 Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 2

Local Growth 70,000 Clark County Redeemed Drivers' Licenses 2 60,000 50,000 40,000 30,000 20,000 10,000 0 3rd 2008 4th 2008 1st 2nd 3rd 4th 1st 2nd 3rd Quarterly 17,461 14,715 13,889 13,458 14,654 13,047 11,919 11,842 14,604 Year-to-Date 49,959 64,674 13,889 27,347 42,001 55,048 11,919 23,761 38,365 Unemployment 6 Las Vegas Q3 13.2% Q4 12.9% Q1 13.8% Q2 14.3% Q3 14.8% U.S. Q3 9.6% Q4 10.1% Q1 9.7% Q2 9.7% Q3 9.6% Clark County Redeemed Drivers' Licenses: Major Categories 2 35% 30% 25% 20% 15% 10% 5% 0% 3rd 2008 4th 2008 1st 2nd 3rd 4th 1st 2nd 3rd Percent from Outside the 50 States and DC 0.1% 0.1% 0.1% 0.1% 0.2% 0.1% 0.1% 0.1% 0.1% Percent from California 31.1% 32.0% 32.8% 31.8% 31.5% 31.2% 31.7% 32.1% 31.6% Percent Senior: Age 60 or Older 11.4% 12.8% 10.9% 11.5% 11.2% 14.5% 13.9% 14.5% 14.4% Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 3

Substitute Market: Apartments Apartment Rental and Vacancy Rates by Zip Code Area 2 ZIP CODE UNIT RATES Studio 1 Bed 2 Bed/1 Bath 2 Bed/2 Bath Furnished Unfurnished Furnished Unfurnished Furnished Unfurnished Furnished Unfurnished Furnished 3 Bed Unfurnished AVERAGE RATES Rent Vacancy 89002 * * * 699 * * * * * * 861 9.2% 89005 * * * * * * * * * * * * 89011 * * * 786 * * * 958 * 1071 924 9.2% 89012 * * * 751 * * * 932 * 1142 911 10.3% 89014 * * * 662 * 777 * 828 * 1016 813 9.6% 89015 * * * 635 * 734 * 754 * 901 758 9.9% 89030 * * * 546 * 527 * 683 * 785 654 10.4% 89031 * * * * * * * 873 * 995 921 10.8% 89032 * * * 695 * * * 817 * 984 840 12.9% 89052 * * * 816 * 997 * 1001 * 1241 965 10.0% 89074 * * * 768 * * * 929 * 1137 879 9.4% 89081 * * * 692 * * * 756 * 1072 846 10.3% 89084 * * * * * * * * * * * * 89086 * * * 740 * * * 943 * 1045 908 9.6% 89101 506 462 * 521 * 625 * 676 * 748 552 14.0% 89102 * 523 * 560 * 623 * 719 * 818 636 12.1% 89103 * 570 * 628 * 693 * 778 * 909 719 10.2% 89104 * 418 * 508 * 611 * 662 * 755 570 11.8% 89106 * * * 545 * 595 * 729 * 860 652 16.6% 89107 * 520 * 574 * 656 * 714 * 913 668 8.6% 89108 * 511 * 623 * 684 * 782 * 948 737 9.6% 89109 * 457 * 562 * 608 * 746 * 782 661 11.8% 89110 * * * 556 * 610 * 690 * 899 692 11.5% 89113 * * * 858 * * * 1072 * * 999 10.3% 89115 * 513 * 530 * 533 * 657 * 780 642 12.5% 89117 * * * 763 * * * 903 * 1074 888 9.8% 89118 * * * 716 * * * 884 * 1053 820 9.8% 89119 560 504 635 611 * 621 * 765 * 904 687 10.4% 89120 * * * 656 * * * 762 * 948 755 10.9% 89121 * 479 * 586 * 625 * 703 * 830 675 11.0% 89122 546 * * 624 * 785 * 783 * 962 767 10.6% 89123 * * * 803 * * * 995 * 1226 971 10.0% 89128 * * * 666 * * * 781 * 939 774 9.6% 89129 * * * 687 * * * 846 * 1138 821 9.0% 89130 * * * 657 * * * 794 * 927 792 13.5% 89131 * * * * * * * * * * * * 89134 * * * * * * * * * * * * 89135 * * * 966 * * * 1165 * 1315 1126 14.0% 89139 * * * 860 * * * 1025 * 1233 1008 10.7% 89141 * * * * * * * * * * * * 89142 * * * 585 * * * 688 * 826 683 6.4% 89144 * * * 873 * * * 1031 * 1221 1082 14.1% 89145 * * * 796 * * * 930 * 1098 941 8.6% 89146 * * * 631 * 596 * 785 * 944 755 11.8% 89147 * * * 742 * * * 903 * 1087 908 9.8% 89148 * * * 836 * * * 942 * 1100 947 8.6% 89149 * * * 788 * * * 1090 * 925 925 10.3% 89156 * * * 611 * * * 683 * 0 679 17.4% 89166 * * * 827 * * * 1122 * 0 1014 12.8% 89169 642 457 703 526 * 610 * 684 * 0 630 12.0% 89183 * * * 769 * * * 929 * 0 913 9.0% METRO LV 561 505 672 657 947 697 683 822 * 989 765 10.8% * Number of observations insufficient for statistical purposes. Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 4

Substitute Market: Apartments Apartment Rental and Vacancy Rates by Zip Code Area 2 89166 89138 89143 89085 89131 89084 89086 89149 89130 89031 89081 89129 89032 89030 89134 89108 89128 89144 89106 89145 89107 89101 89104 89117 89146 89102 89109 89135 89169 89121 89147 89103 89115 89156 89110 89142 89122 Rent Q3 Rent Q3 0 0 1-750 1-750 751-850 751-850 851-950 851-950 89124 951-1050 951-1050 1051-1250 1051-1250 89148 89113 89118 89119 89120 89014 89011 89139 89123 89074 89015 89178 89012 89183 89002 89179 89141 89052 89005 89044 89166 89138 89143 89085 89131 89084 89149 89130 89031 89129 89032 89134 89108 89128 89144 89106 89145 89107 89086 89081 89030 89101 89115 89156 89110 Vacancy Q3 Vacancy Q3 Data suppressed Data suppressed 0.01-8.00 0.01-8.00 8.01-9.00 8.01-9.00 9.01-10.00 9.01-10.00 10.01-11.00 10.01-11.00 89124 11.01-11.01 13.00-13.00 89135 89117 89147 89146 89102 89103 89109 89104 89169 89121 89142 89122 13.01-13.01 18.00-18.00 89148 89113 89118 89119 89120 89014 89011 89139 89123 89074 89015 89178 89012 89183 89002 89179 89141 89052 89005 89044 Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 5

Single-Family Housing-Market Details Distribution of House Size in Square Feet 3 6,000 5,000 4,880 4,923 4,862 4,685 4,890 4,000 3,000 2,000 1,000 2,408 1,891 1,556 1,050 2,270 2,305 2,297 2,294 1,788 1,787 1,807 1,789 1,470 1,474 1,489 1,470 975 969 988 964 0 3rd 4th 1st 2nd 3rd Note: The boxplots can be interpreted as Half the houses have a [square footage, price, price per square foot, or mortgage] between [value at bottom of box] and [value at top of box], with the median being [value in middle of box]. The other half of the houses is evenly split between values that are higher and values that are lower. To show this, lines extend out of the box upward and downward, with 98 percent of houses between [value at top of line] and [value at bottom of line]. The extremely high 1 percent and the extremely low 1 percent are not shown in order to avoid the detrimental effects of outliers, data entry errors, or other anomalies of the market. $800,000 $700,000 $750,640 Distribution of Sales Price 3 $710,000 $600,000 $620,700 $635,100 $650,000 $500,000 $400,000 $300,000 $200,000 $100,000 $0 $220,000 $197,666 $200,000 $203,500 $199,000 $160,000 $141,000 $140,000 $150,000 $140,000 $120,500 $103,000 $102,000 $112,000 $104,800 $55,000 $30,000 $27,000 $27,490 $7,513 3rd 4th 1st 2nd 3rd Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 6

Single-Family Housing-Market Details $250 Distribution of Price per Square Foot 3 $200 $207 $184 $194 $187 $187 $150 $100 $101 $95 $94 $99 $94 $50 $84 $70 $40 $79 $78 $63 $63 $82 $67 $78 $64 $24 $20 $20 $0 3rd 4th 1st 2nd 3rd $4 Note: The boxplots can be interpreted as Half the houses have a [square footage, price, price per square foot, or mortgage] between [value at bottom of box] and [value at top of box], with the median being [value in middle of box]. The other half of the houses is evenly split between values that are higher and values that are lower. To show this, lines extend out of the box upward and downward, with 98 percent of houses between [value at top of line] and [value at bottom of line]. The extremely high 1 percent and the extremely low 1 percent are not shown in order to avoid the detrimental effects of outliers, data entry errors, or other anomalies of the market. $450,000 Distribution of Total Mortgage Value 3 $400,000 $417,000 $407,000 $416,971 $404,561 $409,846 $350,000 $300,000 $250,000 $200,000 $150,000 $171,853 $152,192 $147,184 $163,750 $150,242 $100,000 $118,750 $97,621 $88,654 $108,538 $93,300 $50,000 $0 $33,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 3rd 4th 1st 2nd 3rd Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 7

Housing-Market Comparisons $600,000 Median Home Prices in Selected Western Counties 4 $500,000 $400,000 $300,000 $200,000 $100,000 $0 3rd 4th 1st 2nd 3rd Clark County, NV $143,000 $145,000 $142,900 $148,000 $140,000 Maricopa County, AZ $148,000 $152,443 $147,000 $150,000 $145,960 Salt Lake County, UT $218,175 $215,811 $213,208 $218,112 $220,000 Los Angeles County, CA $330,000 $340,000 $329,000 $345,000 $347,500 Orange County, CA $500,000 $505,000 $505,000 $520,000 $520,000 8.0% Quarterly Increase in Median Home Price 4 6.0% 4.0% 2.0% 0.0% -2.0% -4.0% -6.0% 3rd 4th 1st 2nd 3rd Clark County, NV -2.7% 1.4% -1.4% 3.6% -5.4% Maricopa County, AZ 5.7% 3.0% -3.6% 2.0% -2.7% Salt Lake County, UT -3.9% -1.1% -1.2% 2.3% 0.9% Los Angeles County, CA 5.3% 3.0% -3.2% 4.9% 0.7% Orange County, CA 6.4% 1.0% 0.0% 3.0% 0.0% Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 8

Single-Family Housing-Market Details Number Available and Median List Price of Existing Single-Family Residential Units 5 23,500 $152,000 22,500 $148,000 21,500 20,500 $144,000 19,500 $140,000 18,500 17,500 January February March April May June July August September Available units (left axis) 19,742 20,262 20,548 20,875 21,143 21,361 21,750 22,624 22,719 Median list price (right axis) $149,900 $149,900 $149,900 $149,900 $149,000 $147,000 $145,000 $144,900 $140,000 $136,000 Percent Existing Single-Family Residential Units Sold by Time on Market 5 100% 90% 80% 70% 12.2% 6.7% 10.0% 15.5% 15.5% 15.8% 16.2% 15.8% 14.0% 15.2% 15.2% 6.9% 7.8% 6.5% 6.9% 6.1% 7.2% 6.4% 7.0% 12.3% 9.7% 11.2% 9.7% 10.0% 9.4% 10.3% 11.3% 60% 18.4% 18.7% 16.5% 16.4% 16.2% 15.9% 17.5% 18.4% 19.7% 50% 40% 30% 20% 52.7% 46.6% 49.0% 51.6% 51.0% 52.2% 51.9% 49.7% 46.8% 10% 0% January February March April May June July August September 0-30 days 31-60 days 61-90 days 91-120 days 120+ days Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 9

Single-Family Housing-Market Details Number of Single-Family Home Sales, 3 rd 3 89143 89085 89166 89138 89134 89144 89149 89129 89128 89145 89131 89130 89108 89107 89032 89084 89031 89106 89030 89101 89086 89081 89115 89156 89110 Number of Sales Q3 0-10 11-50 51-100 101-150 151-200 89124 201-300 89135 89117 89147 89146 89103 89102 89109 89119 89169 89104 89121 89142 89122 301-500 89148 89113 89118 89119 89120 89014 89011 89139 89123 89074 89015 89178 89012 89183 89002 89179 89141 89052 89005 89044 Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 10

National Housing Market Conditions 7 Latest quarter Previous quarter Same quarter previous year % change from previous quarter % change from last year HOUSING PRODUCTION Permits 559 589 601-5.09-6.94 Starts 589 602 586-2.10 0.57 Under construction 442 471 591-6.16-25.23 Completions 609 777 766-21.58-20.45 Manufactured (mobile) home shipments 50 56 49-11.83 1.36 HOUSING MARKETING New homes sold 293 335 401-12.52-26.91 New homes for sale 207 214 261-3.58-20.92 Month's supply of new homes 8 8 8 7.17 8.55 Existing homes sold 4163 5570 5280-25.25-21.15 Existing homes for sale 4055 3936 3899 3.01 4.00 Month's supply of existing homes 12 9 9 37.50 31.84 Median new home price 216400 219500 214300-1.41 0.98 Average new home price 253400 268800 274100-5.73-7.55 Constant house quality new home price 276500 282700 280100-2.19-1.29 Median existing home price 177100 176633 178133 0.26-0.58 Average existing home price 225300 222733 223767 1.15 0.69 Composite housing affordability index 173 167 161 3.13 6.94 Fixed-rate housing affordability index 172 167 161 3.14 6.86 Apartments completed 30000 27600 47700 8.70-37.11 Percentage of apartments rented in 3 months 62 56 49 10.71 26.53 Median asking rent 1176 1028 1154 14.40 1.91 Manufactured (mobile) home placements 51 57 48-11.92 5.94 Average manufactured (mobile) home sales price (in dollars) 61650 62167 64633-0.83-4.62 Builders housing market index 13.3 19.0 18.0-29.82-25.93 Builders current sales activity 13.7 20.0 17.0-31.67-19.61 Builders future sales expectations 19.0 24.7 28.3-22.97-32.94 Builders prospective buyer traffic 9.7 14.0 15.7-30.95-38.30 HOUSING FINANCE Conventional fixed-rate 30 year 4.45 4.91 5.16-9.44-13.77 Conventional ARMs 3.57 4.01 4.71-10.89-24.13 Conventional fixed-rate 15 year 3.92 4.29 4.60-8.70-14.72 FHA applications received 209971 188672 236666 11.29-11.28 FHA total endorsements 136628 133995 186597 1.96-26.78 FHA purchase endorsements 89692 96615 107597-7.17-16.64 VA certificates 29372 24794 33672 18.46-12.77 PMI certificates 30345 25892 27144 17.20 11.79 HOUSING INVESTMENT GDP (in billions of dollars) 14730 14579 14115 1.04 4.36 Residential Fixed Investment (in billions of dollars) 327 357 348-8.34-5.92 RFI percent of GDP 2.2 2.5 2.5-9.29-9.85 HOUSING INVENTORY All housing units 130681 130517 130022 0.13 0.51 Occupied units 111914 111667 111222 0.22 0.62 Owner occupied 74874 74735 75182 0.19-0.41 Rental vacancy rate 10.3 10.6 11.1-2.83-7.21 Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 11

Housing-Market Overview Figure 1 Case-Shiller Housing Price Index: January 1987 to September Housing Price Index 250 225 200 175 150 125 100 75 50 Las Vegas, NV Base month, January 2000 = 100.00 Source: S&P/Case-Shiller Home Price Indices <http://w ww.standardandpoors.com U.S. (10-city composite) Sources: 1 Local building permitting agencies. 2 CBER. 3 CBER calculations using CoreLogic Real Estate Solutions RealQuest data based on new and existing recorded home sales. 4 First American CoreLogic Real Estate Solutions data based on recorded home sales. These statistics may differ from CBER calculations based on the same data (reported on page 10) because First American CoreLogic uses raw estimates. 5 Greater Las Vegas Association of Realtors data based on MLS records, which do not necessarily account for newly constructed homes sold by local builders. 6 Bureau of Labor Statistics and Nevada Department of Training and Rehabilitation. 7 U.S. Housing Market Conditions 2nd. Note: As of the 1st 2005 report, statistics in the Single-Family Housing-Market Details section have been revised to reflect only single-family housing. Copyright Conditions Las Vegas Metropolitan Housing-Market Conditions is intended for subscribers. Subscribers may reproduce the publication s items if they cite the publication name and date, and note the copyright of the Center for Business and Economic Research. Send address changes to: The Center for Business and Economic Research, UNLV, Box 456002, 4505 S. Maryland Parkway, Las Vegas, NV, 89154-6002. Phone: (702) 895-3191. Fax: (702) 895-3606. E-mail: cber@unlv.nevada.edu. Web page: http://cber.unlv.edu. Las Vegas Housing-Market Conditions, Volume 56, 3rd Page 12