In business
real estate
those who fell farthest now are soaring highest
By Eli Segall staff writer
After soaring fast and crashing hard, Las Vegas home values are recovering at one of the fastest rates nationally.
But this market isn't alone: Several other cities that experienced housing bubbles and economic destruction when the bubble burst are also
leading the pack in real estate recovery.
In Sacramento, home values climbed 34 percent over the past year, the
fastest rate among major metropolitan areas, according to housing data
firm Zillow. Las Vegas came in second at 33 percent, followed by Riverside, Calif., at 32 percent.
Nationally, home values climbed just 6 percent during the same period.
The rapid growth is due to strong demand for a limited supply of homes
for sale, Zillow Senior Economist Svenja Gudell said. Wealthy investors
swooped in during the recession to buy cheap houses to turn into rentals.
Housing supply also is limited by cities' legions of upside down borrowers. Drowning in mortgage debt, owners can sell their homes only with
bank approval, an often-grueling process.
As of June 30, 48 percent of borrowers in Las Vegas were underwater,
the highest rate in the country, according to Zillow. Other cities above the
24 percent national average included Riverside (36 percent) and Sacramento (32 percent).
Growth in home values is expected to slow nationally, including in Las
Vegas, as some investors, facing high prices they helped create, pare down
on purchases. But for now, property values are skyrocketing in formerly
hard-hit cities.
"I still have to do a double take," Gudell said.
home values as of september and underwater rates as of june
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30%
15%
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Annual home value growth
Rate of underwater borrowers
source: Zillow
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