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Commercial Foreclosures Expected to Do Better than Residential in Las Vegas



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By : John Cutts    99 or more times read
Residential foreclosures in Las Vegas, Nevada, are expected to continue posting higher numbers than commercial foreclosures come 2011. According to business executives and market analysts, huge supplies and lack of demand for residences will cause further declines in residential property prices during the year.

Las Vegas foreclosure listings are expected to remain a major problem for the city, but most economists are predicting a slow recovery for the metro area. According to them, the 14.3% unemployment rate of the region will remain the biggest factor pulling the local economy down. Economists also stated that the standard of living of employees in the southern part of the state is at risk, mainly because businesses will not raise wages, knowing that a lot of the unemployed will be willing to replace the employed for a lesser pay.

When it comes to lowering the number of properties under Nevada foreclosure listings, some economists argued that the best way to address the foreclosure problem is for lenders to reduce the amount of principal owed by residential property borrowers who have mortgages that cost more than the value of their homes. They added that a 50% reduction will go a long way towards stemming the residential foreclosure tide.

As for commercial foreclosures, analysts are predicting that numbers will be lower compared with residential property foreclosures since commercial property owners communicate directly with lenders and banks, unlike residential property owners, who are forced to deal with middle people who, sometimes, have an agenda separate from that of investors who are the owners of the mortgages. Meanwhile, occupancy in commercial properties like hotels is expected to remain high and will contribute to the economic recovery of the area.

Aside from further increases in foreclosure listings, economists also cited the ongoing recession, tax uncertainties and high health care costs as factors that might reverse the expected growth in the region's economy. If these factors are kept controlled, the area's economy will achieve moderate growth during 2011, economists stated.

Residential and commercial foreclosures, unemployment and tax burdens will be the most significant factors that will dictate the economic condition of Las Vegas and the whole Nevada in 2011, economists stated. However, majority of them do believe that the economy will rebound gradually starting 2011.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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