Monday, May 2, 2016 | 2 a.m.
Left for dead during the recession, the Las Vegas real estate market has come back to life over the past few years.
Buyers are picking up new and used properties. Homeowners are getting above water. Developers are building apartment complexes. Employment and wages have climbed.
But it could take several more years before Las Vegas — ground zero for last decade’s real estate boom and bust — fully recovers from the worst recession in decades, which all but wiped out the local economy.
So what’s the state of the housing market? Here’s a barometer based on some recent reports, including how Las Vegas compares to the nation and how the market has changed in the past decade:
Foreclosures and underwater homeowners
When the economy crashed, Las Vegas’ housing market was among the hardest-hit nationally, choked by foreclosures and underwater borrowers.
Residents missed mortgage payments amid sweeping job cuts and lost their homes to lenders, emptying subdivisions valleywide. Home values also plunged, leaving the majority of borrowers underwater, meaning their debt outweighed their home’s value.
Those problems have eased considerably the past few years. For instance, creditors filed default notices against roughly 1,800 homes in the Las Vegas area in the first quarter, down from about 2,200 in the same period last year and nearly 17,800 in first-quarter 2009, according to RealtyTrac.
But foreclosures also have slowed nationally, and lenders still target a bigger share of homes locally than they do in most big cities. Overall, the valley had the sixth-highest foreclosure rate in the first quarter among metro areas with at least 200,000 people, RealtyTrac reported.
Meanwhile, 21 percent of Las Vegas-area homeowners with mortgages were underwater in late 2015, according to home-listing service Zillow. That’s down from a peak of 71 percent in early 2012 but still highest among large metro areas and well above the U.S. rate of 13 percent.
Las Vegas home values have climbed in recent years, but they have more room to grow than in any large metro area to reach peak levels again.
The median home value in the Las Vegas area in February was $201,900, up 9 percent from a year earlier. Nationally, the median was $184,600, up 4.3 percent, according to Zillow.
Locally, home values remain 34 percent below their peak, but across the U.S., values are 6 percent below the peak, Zillow recently reported.
Las Vegas’ gap was largest among the 35 metro areas listed in the report, highlighting Southern Nevada’s rapid home-value growth last decade and devastating crash.
Several cities have recouped their post-bubble losses and reached new highs. According to Zillow, home values hit new peaks in 26 markets during the past year or so — but not in Las Vegas.
“In some markets, these new highs are a return to normalcy,” Zillow chief economist Svenja Gudell recently said. “The fact that other markets are still off by double digits may not mean those markets are far from being recovered. It just highlights how extraordinarily inflated home values had been during the housing bubble.”
Builders couldn’t sell houses fast enough in Las Vegas during the years before the bubble burst, as loose lending practices by financial institutions left the market awash in easy money. But when the economy tanked, builders shut down, projects went bankrupt and buyers vanished.
Sales volume is climbing again, although it’s nowhere near what builders achieved last decade or in the 1990s, before the market inflated rapidly.
Builders sold about 6,800 new homes in Clark County last year, up 13 percent from 2014, and about 1,530 new homes in the first quarter of 2016, up 9 percent from the same period last year, according to Home Builders Research.
By comparison, builders sold about 17,900 new homes in the Las Vegas area in 1995. That soared to almost 39,000 sales in 2005, but plunged to just 3,900 in 2011.
When builders post an annual sales jump of 13 percent, it should “result in congratulatory backslaps all around,” said Dennis Smith, founder of Home Builders Research, in a January report.
But the market remains bogged down by underwater borrowers, land shortages and other issues that show “all is still not roses for the Las Vegas housing market,” he wrote.