MGM City Center Provides Financing for Las Vegas Condos

The following excerpts were taken from this week’s MGM City Center press release announcing that City Center will be providing mortgages for condos and condo hotel units in its 67 acre mega development on the Las Vegas Strip. This is great news for Las Vegas condo purchasers who wrote checks for 20 to 30% down payments five years ago but have been unable to secure outside financing since the Las Vegas real estate crash. Along with City Center’s recent price reductions to meet current market conditions, MGM Mirage seems to be doing everything possible to ensure that the MGM City Center development is a huge success.

LAS VEGAS (December 8, 2009) – CityCenter Holdings, LLC today announced that it has selected Private National Mortgage Acceptance Company, LLC (“PennyMac”) to serve as a lending resource for buyers of condominiums and condo-hotel units at CityCenter. PennyMac will assist buyers in arranging financing for their residential purchases. CityCenter, a joint venture of MGM MIRAGE (NYSE: MGM) and Infinity World Development Corp, a subsidiary of Dubai World, also announced that it intends to provide a seller financing program to well-qualified buyers, which will also be administered by PennyMac.

“PennyMac will be a resource to help our customers to assess their financing options and assist them with the closing of their purchase,” said Bobby Baldwin, President and Chief Executive Officer of CityCenter. “We are pleased to provide qualified buyers an additional option through a competitive seller financing program.”

PennyMac, through its subsidiaries, will coordinate loan origination, servicing, and secondary market activities. PennyMac has partnered with EvoFi One, a leading lender headquartered in Nevada, as an origination provider for this development.The seller financing program will include both a fixed rate and a variable rate option. With the assistance of PennyMac, CityCenter has developed a comprehensive program which takes both the buyer’s financial standing and their purchase into consideration when determining loan terms.

CityCenter also recently announced a 30 percent price reduction to buyers who consummate existing purchase contracts and who execute an addendum to their existing purchase and sale agreement. “We have spoken to the majority of our buyers since the price adjustment announcement, and it is clear that our efforts has been well received,” said Tony Dennis, Executive Vice President, CityCenter Residential Division. “By adding PennyMac as a lending resource, we now provide our buyers with a Las Vegas mortgage option to assist with their closing needs.”

CityCenter closings are scheduled to begin in January 2010 with buyers of The Residences at Mandarin Oriental, Las Vegas. Veer Towers closings are projected to begin in February 2010 and Vdara Condo Hotel closings in March 2010.

It is hoped by local residents that the more than 12,000 jobs created by the massive City Center project will boost the economy and spur Las Vegas homes sales this spring. Banks have been holding their inventories of Las Vegas foreclosure homes off the market in hopes that prices would rise in the first part of next year allowing them to recoup some of their losses.

Ethics in Real Estate – Yes, They Exist!

For all the agents out there – so many times we hear horror stories about others in the real estate industry, especially in hard times like the Las Vegas real estate market has just struggled through. Agents taking advantage of clients or stabbing each other in the back to make a living, lenders charging exorbitant fees to uninformed but credit worthy borrowers, appraisers doing a “favor” to get an appraisal up to the purchase price, etc. Actually this type of behavior happens in all industries, but the real estate market in particular is spotlighted because of the high dollar amounts involved.

Well, I wanted to share the “good” side of the industry for a change. There are a lot of great agents and lenders out there who really watch out for their clients and each other, but we rarely hear praise when it is well deserved.

Recently one of our agents, Maxine, had an international client that was coming into town to look at Las Vegas homes for a vacation retreat. Before the client got to town Maxine sent him hundreds of properties to review, gave him articles about various neighborhoods to read, and went over long lists of questions about everything from taxes to motor vehicle registration. She even went out and found an extended stay hotel and made a reservation for the client, picked him up at the airport and helped him with his rental car. All this before they even went to look at a single property.

The next few days were spent learning the town and refining where the clients wanted to live. The clients finally settled on Lake Las Vegas, and Maxine made sure they had all the latest information on the litigation and HOAs before deciding on a couple of Las Vegas condo units they were interested in. Both of the condos were bank foreclosures or REOs, and the clients made an offer on one. After days of waiting around for an answer and no word from the listing agent, the clients were frustrated and angry. When they finally received an answer, it was that the property had been sold to someone else.

In the meantime the clients had been reading in our local newspaper about how the REO agents were “playing games” with the offers they received, trying to sell their own listings in-house. Even though these clients adored Maxine and appreciated all she had done for them, they insisted on going straight to the listing agent for their next offer, even though Maxine had shown them the property several times.

And here’s the good part of the story – the listing agents happened to be Leslie and John Carver of Prudential Americana (and also in our office) who handle a large volume of Las Vegas foreclosures. In order to avoid any conflict of interest, Leslie never handles the buyers on her own listings. She refers them out to a “buyer’s agent” to write a contract and represent them. But these clients called her several times and flatly insisted on meeting with her. Finally Leslie agreed to meet them, figuring that once they got into the office she would still turn them over to a buyer’s agent.

When the clients got to the office, they again insisted that Leslie write up the offer even though she explained repeatedly that she would have a buyer’s agent handle it for them and that everything would be fine. But they buyers refused, and finally said to Leslie, “If we wanted to use a buyer’s agent we would use Maxine Sutton of the Tonnesen Team. She’s an excellent agent and she has done everything for us, but we don’t want to miss out on this property. We read what is happening in the newspaper and we will only deal direct with the listing agent.”

Now Leslie knew that these buyers were actually Maxine’s clients. But she also realized that they were not going to be satisfied with anything less than her writing the purchase contract for them. And in the best interests of the seller, the offer needed to be written. So Leslie wrote the offer, but IMMEDIATELY contacted Maxine to let her know what was happening and assure her that if these buyers were successful in securing the property, Maxine would be paid.

Would Maxine ever have known that these buyers went around her to get this property? Probably not. Could Leslie have kept this transaction to herself? Probably yes. But Leslie has such high standards that even if the buyers had not loved Maxine, she would have made sure that Maxine was taken care of.

This story has an even happier ending. The buyers got their property, Maxine was rewarded for all her hard work, and Leslie had the immense satisfaction of knowing she acted to the benefit of all parties in the transaction. Everyone did their job, always keeping the client’s best interests at heart. And that’s why I love working at Prudential Americana. Leslie Carver is a true gem, and the other agents in the company share the same high standards. That’s the way we roll with real estate.

Las Vegas Real Estate Market Sees Multiple Offers Return

Dear Readers,

Below is a letter that I sent last night to an Australian agent who has clients that want to buy Las Vegas real estate. I had sent her some “best buy” Las Vegas MLS listings two weeks prior and her clients were supposed to respond immediately. But they procrastinated and lost out on the home they wanted. I realized as I was writing my response, that it was a great lesson in timeliness and patience for any buyer that is looking to purchase in this crazy market.

Hey Jo,

Where you been, girl?! The property your clients chose already has a contract on it – actually they had multiple offers. It sold for cash above the most recent list price, and is due to close this Friday.

We are experiencing a HUGE surge in buying. You know the frustrating experiences you already had trying to put in offers? Well just in the past couple of weeks our market has gone officially insane. Everything decent under $150k is now getting multiple offers within a couple of days and averaging 3% above list price. By the end of March we had 80% more sales than last year at this time!

The listing agents won’t even present an offer now unless it is accompanied by either proof of funds for cash buyers (in the form of a current bank statement) or full loan approval for buyers getting Las Vegas mortgages. The banks don’t even care if the buyers are cash or getting loans – they are only looking at the bottom line since the mortgage buyers are fully approved anyway.

And just to make it even tougher, some of the REO listing agents are playing games with the offers and trying to sell them “in house.” Not what you wanted to hear, I know.

But we have so much pent up demand from first time home buyers: prices are affordable for the first time in years and our federal government passed a tremendous first time homebuyer tax credit. Plus the news is starting to report Las Vegas as one of the most undervalued markets again, so here come the investors once more!

I am right on the spot, and in order to get two properties in escrow for myself this week I had my offers out to the listing agents within hours of the properties going on the market, sight unseen. We actually bid on five Las Vegas homes to get two. They are both short sales, so I still have to wait for the banks to approve the shorts on the loans. (Oh, yes, I am definitely in buying mode myself. I really think we have hit bottom and will start to see a rise again by year’s end. Personal opinion, of course, but it feels right to me based on what I am seeing in the market.) One of the properties I bid on got THIRTY offers!

Anyway, long story short (too late!), first of all your buyers would have to send us their proof of funds in advance, and second they have to be ready to pounce immediately. Literally: we send you the homes, they pick at least two or three to put offers on within just a few hours and then email us back right away so we can prepare contracts. (ALL the banks have counter offer addendums, so the clients won’t ever have to worry about being on the hook for more than one property. If we got lucky enough to get a positive response from more than one, we would just pick the one we liked the best and reject the counter on the other.)

We email back the contracts along with the comparable sales info on the properties they have chosen so that your clients can feel totally confident that they are paying a reasonable price. They sign the contracts and send them back, and then we “present and pray.” We will already be working with a time zone challenge, and really only have perhaps 72 hours between the property going on the market (or having a significant price reduction to below market value) to offer presentation to be effective. And that’s because we truly are sending you the BEST listings.

The buyers should also be prepared to wire funds within one business day to the escrow company to cover the earnest deposit if they get an accepted offer. Very few properties will be completely turn-key – some handy work will probably be required, though there are enough that just require basic cosmetics. (Touch up paint, landscape maintenance, carpet cleaning, etc.) Remember, the lowest priced properties are all Las Vegas foreclosures (bank owned) or Las Vegas short sales – the banks are not making any repairs and are selling “as is, where is.” And most of the original owners were not all that happy about moving out.

If your buyers are truly serious about proceeding, we should get their current proof of funds first off. Then they need to commit to responding with a couple of properties they are willing to purchase within a short (few hours) time frame so that we can prepare contracts. And they need to know that they are probably going to have to bid over list price unless the comparable sales data indicates otherwise. Low balling worked when prices were higher and no one was buying. Now everyone is back in the game again.

Deep breath!! Did I put you to sleep with this novella? I don’t want to discourage your buyers, but unless they are prepared to be really aggressive it’s going to be hard to get them something good.

Cheers and looking forward to hearing back from you – quickly!
Diann

PS When I speak of Las Vegas real estate, that also includes Henderson real estate. It is a small valley and they run right into each other. Also, if your clients do want to go higher in pricing, there are some dynamite deals in some of our gorgeous Las Vegas golf course homes too!

Financing for Foreign Nationals Discontinued – Easy Come, Easy Go

Once again the mortgage lending guidelines have changed with the wind. For a brief period there was a window for foreign nationals to obtain mortgage financing on investment and second homes in the United States with down payments as low as 25%, but now that window has been slammed shut along with a host of other “make sense” loan programs. (Don’t even get me started on condo hotels that can’t be financed by anyone with even 50% down!) 

Many of the foreign nationals who contacted us in recent weeks were willing to put down as much as 30% to 40% or even 50% on Las Vegas foreclosures. With the current housing market crunch, what are the big banks thinking? Here are people with real money, good credit and big down payments that would love to take advantage of lower prices and they can’t get financed?!!! Some of these investors were already under contract on projects in development, and they may have to walk away from substantial deposits unless alternative financing is brought online. (Just as a side note, permanent resident aliens are still able to obtain financing on the same terms as US citizens. If you are a permanent resident alien and need a Las Vegas mortgage, please contact us at 702-985-7654 so we can put you in touch with the right lender.) 

On top of all this, with the stock market dives globally, even those foreign investors who didn’t need financing and were planning on paying all cash are now stepping back as they watch the value of their portfolios diminish. The Euro is back down to 2005 levels and the British pound has plummeted even below that level. 

Canadians, who saw their dollar rise to all an all time high against US currency at $1.10, have watched it tumble in just the past few days to 79 cents versus the US dollar. Literally thousands of Canadians were looking for winter getaways in the US, but have had to put their plans on hold. Again, many of these were all cash buyers looking for modest Las Vegas condos under $100k, but with the devaluation of their dollar they have once again been priced out of the market without financing. 

And even US citizens are being crunched/punished in the mortgage marketplace. The latest is that anyone who has three or more properties with any kind of mortgage on them cannot get financing for a fourth property. Again, even if they are willing to put 50% down and have low loan to value ratios on their existing properties and excellent credit and income, they still can’t get a fourth loan. Not even if you’re Donald Trump. 

With all the resale Las Vegas homes and condos for sale, not to mention the hundreds of thousands nationwide, and all the opportunities to pick up great deals on foreclosures, our banks are not willing to lend to these impeccable buyers who want to buy and have money. Certainly I am not suggesting we should go back to no or low money down programs with no income or asset verifications. But why not create some solid loan programs to entice these good buyers, whether or not they are citizens of the US? The banks would be able to lower their inventories of properties substantially, which would in turn stimulate the economy and gradually raise prices again in a controlled manner.  

All I know is that in the months to come, those with cash who are willing to take a chance on the market now are probably going to come up looking like geniuses in couple of years. My other prediction is that while Las Vegas real estate was one of the first to fall, it will also be one of the first to recover, and I am personally putting my money where my mouth is.

Las Vegas Golf Courses Conserving Water

Since Las Vegas is now a golf destination, I thought it was appropriate to post this letter to the editor of the Review Journal. The owners of Las Vegas homes have been complaining about the recent rate increases on water. For our Las Vegas golf course communities, this rate increase is even more expensive, raising HOA dues and golf membership dues.

To the editor:

After reading Jason Wagner’s Friday letter to the editor, which criticized the Review-Journal’s April 20 feature on the best 18 golf holes in Las Vegas for highlighting water waste by golf courses, I feel it is important to present the facts regarding water usage and Southern Nevada’s golf courses.

First and foremost, the golf industry adds almost $1 billion each year to the Nevada economy.

Golf is an integral part of any resort destination throughout this country or abroad.

Golf courses use less than 8 percent of the valley’s water, and that number is shrinking due to technological advances as well as superintendents’ vigilant water management. Golf courses have removed 500 acres of turf, or the equivalent of five full-size courses, in the past few years, utilizing the Southern Nevada Water Authority’s Water Smart programs. Golf courses are simply the most efficient water users in any water use category. We utilize the most advanced computerized control systems in combination with on-site weather stations to adjust our water usage 365 days a year. Water is golf courses’ No. 1 cost of doing business, and therefore it is imperative that we manage our water efficiently.

Golf courses spend considerable staffing resources to manage this precious and expensive liquid. An average golf course will have two to four employees whose full-time job is to manage water. The rate increase recently passed by the Las Vegas Valley Water District, which will mean an increase to an average homeowner of a few dollars a month, can mean an additional $200,000 annually or more to a golf course’s bottom line. With most other business costs skyrocketing as well, we cannot pass these increases onto our customers.

Golf courses are not green because they waste water. We fertilize correctly, we airify turf correctly, we chose the correct type of turf grass, we water correctly, and we have highly trained staff to identify and fix irrigation problem areas immediately. We apply wetting agents correctly. These are expensive chemicals that help the water to penetrate our poor desert soil, or help it hold on to moisture longer.

Golf course superintendents have worked closely with the Southern Nevada Water Authority to develop water budgets for golf courses to follow to reduce water usage during this period of drought, and have significantly reduced water use along with homeowners.

The golf course industry in Las Vegas is a critical part of our tourism machine, and we must not cause irreparable harm to a huge part of our already shaky economy without looking at the facts.
P.J. McGuire
LAS VEGAS
THE WRITER IS PRESIDENT OF THE SOUTHERN NEVADA GOLF COURSE SUPERINTENDENTS ASSOCIATION

To find out about how to purchase Las Vegas foreclosures in one of our beautiful golf course communities

Tags: las+vegas+real+estate, las+vegas+homes, las+vegas+foreclosures, las+vegas+golf+course+homes, las+vegas+golf+homes

Differences Between Short Sales and Bank REOs or Repos

As you know, it is a great time to be a “buyer” in our Las Vegas real estate market.  Pricing on homes is almost back to the 2005 level, with many of them reduced to be “moved” by the banks. REOs and short sales currently make up almost 40% of the Las Vegas homes for sale.

Bank repos, also known as REOs (real estate owned), are properties that have already been foreclosed upon by the bank. They may be in pretty rough condition, and it is very common for the landscaping to be completely dead and have to be replaced. They are sold “as is, where is” with no warranties. But in some cases you can make your offer contingent upon an inspection to see if any major repair work may be required.  (Some banks won’t allow the due diligence period for an inspection, so you may have to have one done prior to making an offer.)   

Having said all that, you can get a “good deal” with a bank owned property as long as you allow for these extra costs and buy the home for the right price to begin with.  Just because it is a foreclosure, it may or may not be a great deal.

Short sales are a different creature.  The homeowner is behind on their payments, and, in most cases, is hoping that the lender(s) involved will let them sell “short” of what is owed.  This means the bank(s) has to approve the sale.  Again, in some cases, the house will be listed at an extremely low price designed to entice offers.  These offers are brought to the lender (s) for approval and if there is more than one offer, the bank(s) will negotiate the prices up, if possible, to reduce their losses.  Some banks may take 30-45 days to even respond to an offer, perhaps hoping to get more than one.  And the bank usually does not sign off on the offer until just prior to closing, which means they may also accept a new offer up to that point. So even though you have verbal acceptance, until it is actually signed, a short sale can be revoked at any time.

Don’t overlook regular owner occupied “turn-key” homes in this market either.  Lately, most homes are priced to compete with the foreclosures: they come with home warranties and they don’t need out-of-pocket cash dropped into them like most of the Las Vegas foreclosures do. 

If you think you are interested in a foreclosure or short sale, send us the general parameters of what you are looking for: price range, number of bedrooms, pool, location etc.  We will be happy to place you on our automatic email update system that will immediately send you any new listing that comes on the market with your foreclosure criteria.  (The best ones go fast, so be prepared to act quickly!) Or call us at 702-985-7654 to discuss doing a customized search for you.

Amazing Deals on Units Available Pre Closing at the Palms

Even at the Palms Place, where most buyers were the young and the wealthy with cash to burn, there were some buyers that knew a good investment when they saw it. They took the plunge and plunked down a 20% deposit on one of the elegant Palms Place condo hotel units hoping to make a bundle by the time the property was built.

Unfortunately in the meantime the national economy stalled and the Las Vegas real estate market dropped. Now, almost four years later, many of these same buyers are unable to obtain financing in the aftermath of the subprime market debacle. They are desperate to find a buyer just to recoup part of their deposit.

The units below are all available on the pre closing market. The original purchasers of these units want to assign thier contracts prior to closing with the Palms, and these prices are far lower than the units that have closed and are already listed for resale! Check out the one bedroom unit for only $700k! Now THAT is MOTIVATED!!

	1 Bed	Strip	1.199,000
	1 Bed	Mountain	1.088,000
	1 Bed	Mountain	1.088,000
	Studio	Strip	651,900
	Studio	Strip	615,000
	Studio	Mountain	537,000
	Studio	Mountain	525,000
	Studio	Strip	548,000

                         1 Bed          Strip            700,000   -  Deal of the Day!

* All units are fully furnished
* Closing March 2008
* Studio (approx) 620 Sq. ft.
* 1 Bedroom (approx) 1,220 Sq. ft.

**Please note, the units are all on the upper level floors.  Residential units start on the 8^th floor. Floors 13, 14 and all of the 40’s have been skipped due to superstition.

If you would like to find out the details on the assignments, please give me a call at 702-985-7654 right away!

If you can’t quite afford the Palms Place but really want to buy Las Vegas high rise condos, there are also some GREAT deals to be had in the Residences at MGM starting in the high $300s.

http://www.prweb.com/releases/2008/03/prweb791764.htm

Hello world!

Hello, everyone, and welcome to my our new real estate blog! Our goal is to keep you updated on the Las Vegas real estate market and real estate conditions in general around the world.

The Tonnesen Team of Prudential Americana Group Realtors has been selling real estate in the Las Vegas Valley since 1983.  Prior to joining Prudential Americana in January of 2005, the team was at Century 21 and was ranked #1 in the state of Nevada and the Southwest Region for sales, as well as placing in the top 20 of all agents nationally.  The team decided to make the move to Prudential because of Prudential’s advanced technology in the Las Vegas marketplace and the company’s commitment to quality service. After being with Prudential less than a year, the team was ranked in the top 10 in the US for total homes sold out of more than 63,000 agents nationwide.

The Tonnesen Team maintains four award winning web sites in addition to numerous neighborhood sites which generate over 800 new buyers every month in the Las Vegas market. Many of these buyers are international, as the Internet is now the chosen medium for over 83% of consumers looking to purchase real estate. Because of the extensive advertising exposure they are able to offer, Tonnesen Team members are recognized as the premiere Internet specialists in Las Vegas and as top sales leaders in many of the booming new high-rise projects going up around the Las Vegas Valley as well as traditional single family homes. 

Please feel free to email us with any questions and to visit our site at www.greatlasvegashomes.com . Or if you are interested in Las Vegas condos please visit our high rise condominium site at www.greatlasvegascondos.com.

Deadbeat Landlords Leave Tenants in Bad Situations

It is happening all over the country – unsuspecting tenants are returning home from work to find an eviction notice on the front door. The bank has aquired the property through foreclosure and the tenant has to get out of their current home within 30 days. The tenant almost never is able to recoup any of the rent money paid or get the security deposit back.

And in a market rife with vacant homes for sale, Las Vegas has more than its fair share of deadbeat landlords and unscrupulous property managers. Almost half of the 19,000 homes currently listed are Las Vegas foreclosures and many of them are Las Vegas new homes that were purchased by investors and have never been lived in.

One recent incident came to our attention:

A real estate agent who was renting a luxury 4500 square foot Las Vegas homes, came back to find the eviction notice on the front door. Immediately he called the property manager whose phone was all of a sudden disconnected. Doing some detective work he was able to track down the home’s owner who lived in South America and contact him by phone. Turns out that the “property manager” was an unlicensed friend of the owner. The owner had had half a dozen properties his “friend” was “managing,” and the “friend” was supposed to be paying the mortgages on them from the rental proceeds. (In Nevada, by law you must have a property management license to manage rentals that belong to someone other than yourself.)

Unfortunately, the “friend” never made a mortgage payment and absconded with the hefty security deposits and monthly rental fees being paid by the tenants. It also turned out that the owner had never even signed the rental agreement on this particular property. His signature had been forged and the “friend” had told him that this property had remained unrented.

The real estate agent’s chances of recouping his $4500 security deposit is almost nil. He has to find another home to rent and move his wife, three kids and brother plus assorted pets in a very short time. The owner’s home is already foreclosed upon and he lost all his equity to the bank.

How can tenants protect themselves from this happening to them?In Las Vegas, Noble Title Company is offering a $200 service for tenants called a “Request for Notice.” The service identifies the legal owner of the property and whether or not the property is currently in foreclosure. If the landlord is not in foreclosure, the Request for Notice requires the bank to notify the renter should the home go into foreclosure, which would give the tenant at least four months to pack up and move before the bank repossesses the home.

At least with this service, if the tenant receives a notice that the property is in foreclosure, they could opt NOT to pay rent to recoup some of their expenses and their potentially lost security deposit. And they wouldn’t be quite so jammed for time to find a new place to live. (The real estate agent mentioned above had a real problem. He already had his kids in specific Las Vegas schools, and there were no other large properties in that area for rent. He was not only forced to move his family to a different home, his kids had to move schools as well.)

So tenants beware! Even though you are only renting a home, you still need to do your due diligence to make sure you aren’t unexpectedly out on the street and out of pocket as well.

National Foreclosure Crisis Not as Bad as it Seems

I just read this great article by Scott Burns, and thought I would like to share it with my readers! Makes great sense amid all the media hullaballoo. And for those with savvy, right now is a terrific time to buy Las Vegas real estate!

Sure, there are pockets of pain around the US, but it’s not as if most Americans are losing their homes. More than 99% of homes aren’t in foreclosure. By Scott Burns scott@scottburns.com

A recent list of year-end mortgage foreclosure rates in 100 top metropolitan areas drew a lot of attention. Released by RealtyTrac, a company that compiles data on home foreclosures, the list showed the number of foreclosure filings in each metro area, the percentage of homes being foreclosed and the percentage change from the previous year. Though the report had some dismal news — such as the nearly 4.9% foreclosure rate in the Stockton, Calif., area — a close look at the data also provides some reassuring information. It tells me, for instance, that the foreclosure crisis is a regional problem, not a systemic one. It could become a systemic problem, of course, but we’re a long way from that now.

This news will disappoint the gloom-and-doom crew and all those seeking the excitement of financial upheaval. But it may be time to temper our worry and take a closer look at some of the year-over-year foreclosure statistics: Though the national rate of foreclosure increased by a whopping 79% between December 2006 and December 2007, the rate was still only 1.033%. Because about 30% of all homes are owned mortgage-free, this means that for all the noise about a crisis, only seven-tenths of 1% of all homes were in foreclosure.

In the top 100 housing markets, the average foreclosure rate was somewhat higher — 1.38% — and it was up 78% over the previous year. (Even in the Valley, where the Las Vegas foreclosures at at 4.23%, most of those are investment properties bought in the heat of the boom.) But if you rank-ordered the list of the top 100 areas, only 34 had foreclosure rates above the group average. Fifty-one areas had rates of 1% or less. Foreclosure rates actually fell in 14 of the 100 areas. More important, many of the areas with the highest increases in foreclosure rates were rising off rates that were tiny. The Bethesda, Md., area, to offer the most extreme case, saw foreclosures rise 1,288% — to a rate of 0.682%. In other words, foreclosures there were virtually nonexistent the year before. Today they are still well below the national average. The same can be said for the Albany, N.Y., area (up 638% to 0.25%), the Baltimore area (up 544% to 0.73%) and the Providence, R.I., area (up 354% to 0.41%).

Another pattern emerges if you cross the foreclosure rates with the Office of Federal Housing Enterprise Oversight (OFHEO) index of home prices. It shows that the top 10 foreclosure areas in America are areas of extreme price change — changes far from the national average of 46.92% over the past five years. Seven of the top 10 foreclosure areas had experienced major price spikes in the past five years. Three of the top 10 foreclosure areas had experienced price increases that were dramatically lower than the national average.

That pattern continues when you examine the top 25 foreclosure areas. The seven areas with the top price appreciation for the past five years averaged a stunning 91.6% increase, nearly double the national average. The national average, in turn, was about triple the inflation rate for the period. (Las Vegas homes increased 88.3% over the past five years.) Small wonder the foreclosure rate is booming as well. Anyone who bought in the past few years with a 5% or 10% down payment has a good chance of being upside down as froth comes off the market. In those areas the problem is about irrational price spikes and the hazards they bring to homeownership.

Some would call this “a Cadillac problem” — a great problem to have, like having more boats than you have water-skiers. Though 5% of the homeowners may be losing their homes, most of the other 95% probably feel significantly richer.

Las Vegas new homes builders are running out of inventory and lower priced housing is starting to get multiple offers again. 2008 is going to be a better year for the Las Vegas market, for sure!