Las Vegas remains nation's capital for underwater homes and foreclosures
One of every 70 homes in Las Vegas received a foreclosure filing in October. For 19 of the last 20 months, the city has held the highest rate of foreclosures for any metro area. And with more than 80% of its homeowners underwater on their mortgage in the third quarter, Las Vegas continues to hold the nation's top spot for negative-equity homeowners and rates of foreclosure. Since February 2009, Las Vegas has held the highest foreclosure rate every month except November 2009 when Merced, Calif., passed it, according to RealtyTrac data. Merced was also the last city to have the most foreclosures 21 months ago. That February, the Las Vegas foreclosure rate was at one in 60, more than seven times the national average. But the volume of foreclosures has gone down. In the first quarter of 2009, there were 35,321 Las Vegas properties that received a filing, compared to the third quarter of this year when 32,288 properties received a filing. It's a decrease of 8.5% over that span. Still, Las Vegas holds a foreclosure rate nearly five times the national average, and having such elevated concentrations for a prolonged period time shows. Squatters sleep in tents on abandoned developments dreamed up during the bubble, and casinos are muted. Metro-Goldwyn-Mayer, owner of the MGM Grand, filed for Chapter 11 in November. According to a report from MDA DataQuick, the median home price in Las Vegas has fallen more than 58% from the peak in November 2006 to land at $130,000 in September. Such staggering drops has left four out of every five homeowners in Las Vegas owing more on their mortgage than the home is worth, according to a recent study from Zillow. Hundreds of projects are planned in the downtown redevelopment area, according to city officials, including the $40 million, first phase of Symphony Park. Still, plummeting prices and underwater homes are a millstone around the neck of the market, according to Zillow Chief Economist Stan Humphries. "Beyond the lost tax credits, the [Nevada] housing market has been undermined by a weak economic recovery, a lack of significant job growth and potential homebuyers’ concerns about job security," according to DataQuick. Write to Jon Prior.