Jul

28

Real Estate Close-Up: Las Vegas

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Las Vegas which is having the worst housing markets in the country now taint Sin City’s commercial real estate market, sending vacancies in all sectors sky high along with job losses and high fuel prices.

According to Marcus & Millichap Real Estate Investment Services its commercial sectors clocked the second-worst increase in vacancies in the past year as there is the main problem is too many empty offices.

Hessam Nadji, managing director of Marcus & Millichap. said “The first domino for commercial real estate was the loss of construction jobs. The second domino was the effect of job losses, foreclosures and lost home equity on the local economy. And the third domino was the national economic slowdown, In Las Vegas 56,000 jobs were created three years ago, but it had lost 5,000 through May, which is a significant turnabout.

The main culprit is the local housing environment. Foreclosures aren’t just a problem of homeowners. Dave Dworkin, a research analyst at Grubb & Ellis Co., said foreclosures on small industrial properties are on the rise in Las Vegas.

To buy an industrial building for their business, owners have taken out second mortgages on their homes a research analyst said. And added due to downward economy they are unable to maintain both payments.

The vacancy rate for industrial buildings is almost 8 percent, nearly double the rate two years ago. The smaller tenant is hunkering down,”

Business owners can still get financing from the Small Business Administration but they fear price will fall, so few are willing to take a gamble on buying their own industrial buildings anymo

Jul

27

Housing rescue bill heads to Bush for signature

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On Saturday a housing rescue bill passed by Congress for sparing 400,000 struggling homeowners from foreclosure. The measure is expected to be signed by President Bush quickly.

It was approved by 72-13 vots during a rare weekend session in the Senate, that let the homeowners refinance into more affordable government-backed loans who are unable to afford their monthly payments, in place of losing their homes. Fannie Mae and Freddie Mac, the troubled mortgage companies also got a temporary financial support and controll is tightened over them by this Bill. Higher limits on loans that Fannie Mae and Freddie Mac can buy and the Federal Housing Administration can insure is allowed which is upto $625,000.

Bush dropped a threat to veto it this week after an argument with Treasury Secretary Henry M. Paulson who said that for calming markets in the U.S. and abroad the support for Fannie Mae and Freddie Mac was vital. Initially Bush said proposal was a burdensome bailout for irresponsible borrowers and lenders.

Bush opposed $3.9 billion in the bill that would help neighborhoods devastated by the housing crisis buy and fix up foreclosed properties. The administration argues this would hurt homeowners by giving lenders an incentive to foreclose rather than help people stay in their homes.

Supporters said the bill would help to boost the sagging economy and is a long-overdue response to the mortgage meltdown.