Can it be true? In this reeling housing market that makes mortgage approvals a major mental and physical exercise and closed real estate transactions an endurance test it was hard to believe what the Review-Journal headline actually said. But there it was, loud and clear. "Foreclosures in Las Vegas drop in January."
Southern Nevada residents are nowadays used to reading headlines that talk about how they are climbing, or surging, not dropping. Anything that suggests upward movement. The statement is accurate, though. Foreclosures.com is behind the statistic disclosing that LV numbers decreased about 20% in January from December, or from 3,283 to 2,609. Very nice improvement indeed after so many months of adverse results.
This may not be a permanent trend, however. Not yet anyway. A major factor behind the decline seems to be the moratorium Fannie Mae, Freddie Mac and several major banks have instituted on new foreclosure filings. The idea behind that is to give homeowners more time to find a solution to their dire situation. That's a reasonable approach but it has also softened the stats.
The surprise headline, however, could easily have unintended, positive consequences for the consumer here. For anyone living in the Las Vegas area. And even beyond. The word drop is associated with the word foreclosure for the first time in a long while and it has to mean that maybe there are better days ahead. That there is reason to believe that things will eventually turn around.
Secondly, the media has been bursting for months with all sorts of rescue this and rescue that material and so far there is very little to show that any of that is working. Except now, it appears. The public sees that Washington is taking action, using Fannie Mae and Freddie Mac in this case, and has also managed to prod several banks into seeking creative and useful solutions. The awareness that the mortgage problem is being urgently tackled can assist the consumer to begin healing the lost confidence he has recently developed for the housing market.
The problem is deep and it'll take quite some time to fully fix. Yet, these small things can and will help restore optimism in that it is very much doable.