Parts of valley see improvements in home prices in 2010

The "Biggest Loser" in Las Vegas is not a reality TV show, the university football team or even the unfortunate saps who keep the lights aglow on the Strip.

It's homeowners in ZIP code 89119 around McCarran International Airport, where the median home price dropped 24 percent, or $20,000, last year to $65,000, Las Vegas-based research firm SalesTraq reported.

The residential area borders a mix of industrial zoning and the average home is nearly 32 years old, or twice the Las Vegas Valley average, SalesTraq President Larry Murphy said. It's also got a heavy concentration of lower-priced apartment conversions.

Runner-up was ZIP code 89015 in Henderson, which saw a decrease of 17 percent, or $20,504, in median home price to $99,496. In terms of absolute value, homes in ZIP code 89144 in the Summerlin community lost $21,500, or 12 percent, to $163,500.

The best thing that can be said about Las Vegas home values is they've ended their precipitous fall and have actually risen in some parts of the valley, an analysis of sales by ZIP code showed.

Of 56 ZIP codes in the Las Vegas Valley, 13 showed appreciation in home values, two were flat and 30 had depreciation limited to single digits. That's welcome news from 2009 when every ZIP code showed depreciating values and the average decline was 23 percent.

Murphy makes the caveat that no two homes are exactly alike, and that a comparison of median prices simply means half the homes in a particular area sold above the median and half sold below.

"Everyone takes a look at this and makes the erroneous assumption that this is my house," Murphy said of his ZIP code analysis. "This is not your house. It's all the houses in your neighborhood, all the condos, all the apartment conversions. It even includes mobile homes."

Foreclosures and short sales -- which account for roughly 70 percent of all sales -- continue to place downward pressure on Las Vegas home prices. The government's Home Affordable Mortgage Program and Home Affordable Foreclosure Alternative accomplished little in stemming Nevada's foreclosure crisis.

Inventory of homes for sale in Las Vegas climbed to 21,656 at the end of last year, an increase of about 2,000 homes from the previous year, a result of weak demand and tighter lending requirements.

For the first time in three years, Las Vegas didn't make the list of U.S. cities with the steepest declines in home values, often dominated by areas that were hardest-hit by the housing bust. They include Miami; Orlando, Fla.; Atlanta; and Chicago, real-estate website Zillow.com reported.

Overall, the median Las Vegas home price fell to $120,000 in 2010, a decrease of $4,500, or 4 percent, from the previous year, SalesTraq reported.

On the plus side, top gainers were ZIP codes 89030 in the middle of North Las Vegas and 89109 around the Las Vegas Country Club, each posting an 11 percent increase in home values. ZIP code 89109 led Las Vegas with a 60 percent decline in 2009.

"Some of this has to do with where we are on the recovery curve," Murphy said. "My feeling is we're at the bottom of it. Areas that went down the earliest and fastest will also be the earliest and fastest to come back up."

Murphy said he wouldn't be surprised to see about half of the valley's ZIP codes finish in neutral to slightly positive territory this year.

"I think Las Vegas as a city is ahead of the national recovery curve, probably six months to a year ahead of the rest of the country," Murphy said. "My point is we're probably the single most affordable major metropolitan area in the country."

David Brownell of Keller Williams Realty said the Las Vegas housing market stayed pretty constant in 2010 without a lot of surprises.

"Those who projected the beginning of a turnaround were left to grasp a few glimmers of hope that came to pass and those who warned of another year of further crashes throughout the market -- the doom-and-gloomers -- were also off the mark," he said.

Inventory declined in December for the first time since April, but remained 50 percent above 2009 levels, taking out pending and contingent offers. Real estate-owned, or bank-owned, and short-sale inventory rose 58 percent and 68 percent, respectively.

"The next wave of REOs may be upon us," Brownell said. "We shall see."

He counted 1,880 bank-owned home sales in December, the highest number since March. The general consensus that short sales -- or lender-approved sales for less than the mortgage balance -- would surpass REOs in 2010 proved to be wrong, he said.

They came close in June, when 34 percent were short sales and 38 percent were REOs, but the spread widened toward the end of the year as REOs accounted for about half of December sales.

SalesTraq's Murphy put the REO inventory at 12,442, including 3,433 available on the Multiple Listing Service, leaving an unlisted inventory of 9,009 bank-owned homes.

CoreLogic, a Santa Ana, Calif.-based foreclosure information tracker, recently reported that one-fifth of Las Vegas homeowners with a mortgage are 90 days delinquent on their payment, which equates to about 75,000 homes facing foreclosure or short sale.

This pipeline of distressed sales will keep Las Vegas home prices down for the next couple of years, Murphy said.

The good news is that Las Vegas homes are the most affordable in the country and very attractive to retiring baby boomers who don't care about the area's 15 percent unemployment rate, he said.

"They still see all the positives that were here before and they don't need a job, so who cares?" Murphy said. "They've still got to sell their home back in Minnesota or somewhere, so we're not going to see the influx until they can get rid of their property in other parts of the country. But when they can get the same house here for half of what it is back there, you may see some baby boomers drop their price by one-third or more and come out here and get the same house for half as much. That may be one saving grace for our market."

As far as buying a home based on a particular area of Las Vegas, Murphy said it would depend on the buyer's motive. An investor might want something affordable that can easily be rented out, while an owner-occupant would look at neighborhood amenities and other criteria.

"That's going to vary with each individual. For me, I'm going to buy something in a golf course community," Murphy said. "Bottom line is if you can afford to buy, now is the time because there's a great selection of homes. If you want to look like a genius in five years, buy real estate today in Las Vegas."

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.