Just how toxic are foreclosures to those homeowners who pay their mortgages?
Nasser Daneshvary, director of the Lied Institute for Real Estate Studies at UNLV, has done a study along with Assistant Director David Jones and economics professor Mike Clauretie.
They estimate homeowners who make their mortgage payments had their values cut by an average of $78,000 from July 2008 to July 2009 because of their neighbors. They urged lenders to do more short sales — the sale of homes for less than what the owner owes on the mortgage.
In October, the Greater Las Vegas Association of Realtors reported 28 percent of sales were short, down from a peak of 34 percent in June. But short sales averaged 7 percent to 8 percent of total existing-home closings in early 2009.
Their fear is that homeowner’s values will decrease more, and people will walk away from their homes. One research firm reports 80 percent of Las Vegas homeowners are underwater, according to the Las Vegas Sun.