March 2014
Report on Nevada’s Housing Market This series of reports on Nevada’s Housing Market is co-presented by the Lied Institute for Real Estate Studies at the University of Nevada, Las Vegas and the State of Nevada Department of Business & Industry. These reports provide monthly updates on housing market trends for stakeholders throughout Nevada, which will be crucial as Nevada embarks on a path of housing recovery.
Funding provided by the Housing Data and Index Project, a joint initiative of:
Nevada’s Housing Market | March 2014
Table of Contents Nevada Statewide Trends…….................................... 2 Northern Trends………………………………………….. 10 Southern Trends………………………………………….. 14 Rural Trends…………………………………………........... 18
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Nevada’s Housing Market | March 2014 Nevada Statewide Trends
Population: 2,790,136 in 2013
Housing Units: 1,183,870 in 2012
Source: U.S. Census Bureau: State and County QuickFacts
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Nevada’s Housing Market | March 2014
Nevada Statewide Trends As the first quarter of 2014 ends, Nevada shows significantly less distress in the housing market. The share of homes with a mortgage underwater is 29.4 percent, which is 14.6 percentage points lower than last year. However, this number might stagnate as the sales price of homes begin to stabilize. The state is beginning to see less short sales as there were an estimated 131 short sales in March 2014, this is 250 less than in February 2014. Most happened in Southern Nevada. Homes being sold due to financial distress make up 13.5 percent of all single-family home sales. Traditional home sales continue to dominate the market as fewer home owners are losing their homes due to foreclosure, and fewer are choosing to short sale.
Humboldt Elko Washoe Pershing Lander Storey
Eureka
Churchill White Pine
Carson City
Lyon
Douglas Mineral
Single-Family Home Sales* New Existing Distress Share Residential Construction Total Starts Single-Family Multifamily Average Single-Family Sales Price* New Existing Distress
March 2014 457 4092 13.5%
M2M Change -9.3% +2.1% -38.2%
Y2Y Change -42.3% -15.4% -58%
1090 690 400
+181 +146 +35
+78 -183 +261
$304,568 $199,459 $151,447
-0.5% +1.1% -2.4%
+23.4% +10.1% +3.4%
Nye Esmeralda Lincoln
Clark
Source: Lied Institute calculations using CoreLogic Data and the State of the Cities Data Systems by U.S. Department of Housing and Urban Development. *Figures portray Three-Month Moving Weighted Averages
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Nevada’s Housing Market | March 2014
Nevada Statewide Trends Monthly Number of Sales 2000 4000 6000 8000 10000
Single-Family Home Sales
Existing Source: CoreLogic Note: Series are 3-month weighted moving averages.
New
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
2014
2013
2012
0 Date (January 2000 - March 2014)
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
100 2000
Average Price in Thousands 200 300
400
Single-Family Home Prices
Date (January 2000 - March 2014) Existing
New
Source: CoreLogic Note: Series are 3-month weighted moving averages.
The Single-Family Home Prices figure above shows the three-month moving average price of existing homes and new homes. Existing homes are single family homes that were exchanged from one private owner to another. This includes homes sold by real estate agents, owners, and lenders. New homes are single family homes that were exchanged from a builder to a private owner. The other figure, Single-Family Homes Sales, illustrates the frequency of those transactions for both existing and new homes. A seasonal pattern is obvious in the Single-Family Home Sales graph. In Nevada, each year, there are more home sales during the summer than during the winter.
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Nevada’s Housing Market | March 2014
Nevada Statewide Trends
Reno
2007
Nation
Source: National Association of Home Builders Note: Series denote the proportion of home sales affordable at median income.
50 10
2014
20 30 40 Washoe Listings in Hundreds
Clark Listings in Hundreds 130 160 190 220
250
Date (1 Quarter 2000 - 4 Quarter 2013)
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
Equilibrium
Las Vegas
Nevada Single-Family Homes for Sale
100
Proportion of Affordable Home Sales 20 40 60 80 100
Housing Affordability
2008
2009 2010 2011 2012 Date (January 2007 - February 2014) Clark
2013
2014
Washoe
Source: Greater Las Vegas Association of Realtors and UNR's Center for Regional Studies
The Housing Affordability figure shows the proportion of home sales that could have been bought by borrowers with a conventional loan earning at least the local median income. It is an index developed by the National Association of Home Builders (NAHB). As a benchmark, half of the working class should be able to afford half of the homes sold when the market is in equilibrium. The other figure, Nevada Single-Family Homes for Sale, shows the number of homes available for sale at the end of the month. These numbers include new listings that are awaiting a purchasing contract. Furthermore, they include homes that are under contract and about to sell.
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Nevada’s Housing Market | March 2014
Nevada Statewide Trends 80
Share of Distress Single-Family Home Sales
Source: CoreLogic Note: Series are 3-month weighted moving averages.
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2013
2014
2001
Short Sales
2000
REO Sales
0
Date (January 2000 - March 2014)
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Share of Distress Sales 20 40 60
Monthly Number of Sales 1000 2000 3000 4000
Single-Family Distress Sales
Date (January 2000 - March 2014) Source: CoreLogic
Single-Family Distress Sales is a figure that displays the monthly number of Real Estate Owned (REO) sales and short sales. REO sales are homes that have been repossessed by lenders through foreclosure and then sold in the market. Short sales, on the other hand, are homes that were sold for an amount below the owner’s outstanding mortgage balance. Both numbers are three-month weighted moving averages. The other figure, Share of Distress Single-Family Home Sales, tracks the proportion of home sales (including new home sales) that were REO sales or short sales. A healthy proportion for a housing market is close to zero.
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Nevada’s Housing Market | March 2014
Nevada Statewide Trends Equity in Quarter 1, 2014
Date (January 2000 - March 2014) 90+ Days Delinquent Source: CoreLogic
Percent 10 20 30 40 50 60 70 80 90 100
(Home Value - Mortgage Balance)
0
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
20
Count in Thousands 40 60 80
100
Foreclosure Trends
2010
Foreclosure Inventory
2011 Positive Equity
2012
2013
2014
Negative Equity
Source: CoreLogic
The Foreclosure Trends figure includes two series: the 90+ Days Delinquent series and the Foreclosure Inventory series. The 90+ Days Delinquent series consists of the number of homes that are secured by a loan in default for 90 days or more. This includes homes that are in the process of being foreclosed. The Foreclosure Inventory series consists of homes that have begun the foreclosure process or are in some stage of foreclosure. The other figure depicts what proportion of homes secured by a mortgage have positive equity or negative equity. When a home has a market value at or above its outstanding mortgage balance, it is consider to have positive equity. Otherwise, the house has negative equity.
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Nevada’s Housing Market | March 2014
Nevada Statewide Trends 8000
Residential Home Auctions
2005
2006
2007
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
REO 3-Month Moving Average NOD 3-Month Moving Average Source: RealtyTrac
2013
2014
Actual REO Actual NOD
0
0
Monthly Frequency 2000 4000 6000
Monthly Frequency 2000 4000 6000 8000 10000
Notices of Default and Repossessions
2005
2006
2007
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
Notice of Trustee Sales
2013
2014
3-Month Moving Average
Source: RealtyTrac
These two figures are based on numbers gathered from County records by RealtyTrac. The first figure shows the monthly number of Notices of Default and Repossessions. The Notice of Default (NOD) is the initial stage of foreclosure that starts at least 90 days after the homeowner’s mortgage default date. Not all homes that receive a NOD will necessarily be foreclosed. There exist other alternatives homeowners can invoke such as a loan modification, deed-in-lieu of foreclosure, and short sale. The other figure, Residential Home Auctions, shows the monthly number of homes that received a Notice of Trustee Sale and underwent a public auction. It includes both the successful and unsuccessful actions. Those that were unsuccessful are reverted back to the lender, which are expectedly sold later in the market as an REO.
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Nevada’s Housing Market | March 2014
Nevada Statewide Trends Top 20 States in Foreclosure Starts
Top 20 States in Foreclosure Inventory 1st Quarter 2014
1st Quarter 2014 Maryland New Jersey Florida Rhode Island Illinois Mississippi Indiana Ohio Maine Georgia New York Connecticut Kentucky Alabama South Carolina Arkansas West Virginia Tennessee Oklahoma Louisiana
New Jersey Florida New York Maine Connecticut Illinois Hawaii Nevada Maryland Vermont Ohio Delaware New Mexico Pennsylvania Oregon Rhode Island Indiana 0
2 4 6 8 10 Percent of Loans in the Foreclosure Inventory
Source: Mortgage Bankers Association's National Delinquency Survey
12
0
.25 .5 .75 1 Mortgage Foreclosure Starts as Percent of Stock
1.25
Source: Mortgage Bankers Association's National Delinquency Survey
These figures rank Nevada nationally on the basis of statistics that are provided by Mortgage Bankers Association’s National Delinquency Survey. The Top 20 States in Foreclosure Inventory figures is a ranking that uses the proportion of loans in the foreclosure inventory. That is the number of home loans reported to be in some stage of foreclosure divided by the total number of home loans serviced. The Top 20 States in Foreclosure Starts is a ranking that uses mortgage foreclosure starts as a percent of stock. In other words, this is the number of initiated foreclosures divided by the total number of home loans serviced.
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Nevada’s Housing Market | March 2014 Northern Trends
Population: 614,491in 2013 Source: U.S. Census Bureau: State and County QuickFacts
Housing Units: 267,622 in 2012 (Carson City, Churchill, Douglas, Lyon, Storey, and Washoe County)
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Nevada’s Housing Market | March 2014
Northern Trends Housing conditions in the northern counties are improving better than the state average. The share of homes with a mortgage underwater is 22.8 percent, 6.6 percent lower than the state average. This number could continue to decline if home prices continue to grow.
Humboldt Elko Washoe
New home prices increased 4.8 percent during March 2014 and are now priced at $344,632 - this is $40,000 more than the state average. Further growth has the potential to motivate residential construction.
Pershing Lander Storey
Eureka
Churchill White Pine
About 1 out of every 10 home sales are either short sales or real estate owned (REO) sales. We can anticipate this to further decline since the foreclosure inventory fell again in March; there were fewer than 2,000 homes in some stage of foreclosure. Single-Family Home Sales* New Existing Distress Share Residential Construction Total Starts Single-Family Multifamily Average Single-Family Sales Price* New Existing Distress
Carson City
Lyon
Douglas Mineral
March 2014 99 830 10.2%
M2M Change -1.3% +2.8% -43.2%
Y2Y Change -4.2% -8.4% -66.1%
160 128 32
-5 -8 +3
+43 +11 +32
$344,632 $232,898 $159,641
+4.8% -0.7% -2.4%
+30.8% +1.6% -0.6%
Nye Esmeralda Lincoln
Clark
Source: Lied Institute calculations using CoreLogic Data and the State of the Cities Data Systems by U.S. Department of Housing and Urban Development. *Figures portray Three-Month Moving Weighted Averages
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Nevada’s Housing Market | March 2014
Northern Trends 2000
Single-Family Home Sales
Date (January 2000 - March 2014) Existing
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2000
2001
0 2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
150 2000
Monthly Number of Sales 500 1000 1500
Average Price in Thousands 200 250 300 350
400
Single-Family Home Prices
Date (January 2000 - March 2014)
New
Existing
Source: CoreLogic Note: Series are 3-month weighted moving averages.
New
Source: CoreLogic Note: Series are 3-month weighted moving averages.
Share of Distress Single-Family Home Sales
Source: CoreLogic Note: Series are 3-month weighted moving averages.
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2013
2014
2001
Short Sales
2000
REO Sales
0
Date (January 2000 - March 2014)
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Share of Distress Sales 20 40
Monthly Number of Sales 100 200 300 400
60
Single-Family Distress Sales
Date (January 2000 - March 2014) Source: CoreLogic
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Nevada’s Housing Market | March 2014
Northern Trends 1500
Notices of Default and Repossessions
2005
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
0
Count in Thousands 5 10
Monthly Frequency 500 1000
15
Foreclosure Trends
2006
Foreclosure Inventory
2013
2014
Actual REO Actual NOD
Source: RealtyTrac
Source: CoreLogic
Residential Home Auctions
1000
Equity in Quarter 1, 2014 (Home Value - Mortgage Balance)
0
200
Monthly Frequency 400 600 800
Percent 10 20 30 40 50 60 70 80 90 100
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
REO 3-Month Moving Average NOD 3-Month Moving Average
Date (January 2000 - March 2014) 90+ Days Delinquent
2007
0
2005 2010
2011 Positive Equity
Source: CoreLogic
2012
2013 Negative Equity
2006
2007
2014
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
Notice of Trustee Sales
2013
2014
3-Month Moving Average
Source: RealtyTrac
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Nevada’s Housing Market | March 2014 Southern Trends
Population: 2,027,868 in 2013 Source: U.S. Census Bureau: State and County QuickFacts
Housing Units: 849,361 in 2012 (Clark County)
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Nevada’s Housing Market | March 2014
Southern Trends Residential construction is picking up and seems to be stabilizing the excessive price growth in new homes that was seen last year. The average price of new single family homes fell to $296,741, and 343 sold in March 2014, which is 11.4% less than the prior month.
Humboldt Elko
On the other hand, existing single-family home sales grew in numbers by 2% month-to-month. Their average price also increased in March, but by a modest amount (1.7% month-tomonth). The foreclosures inventory went down from about 9,100 homes in February 2014 to 8,000 home in March 2014. This condition is better than before, yet not ideal for a healthy housing market.
Washoe Pershing Lander Storey
Eureka
Churchill White Pine
Carson City
Lyon
Douglas Mineral
Single-Family Home Sales* New Existing Distress Share Residential Construction Total Starts Single-Family Multifamily Average Single-Family Sales Price* New Existing Distress
March 2014 343 3098 14.6%
M2M Change -11.4% +2.0% -36.8%
Y2Y Change -48.9% -16.3% -56.7%
908 540 368
+175 +143 +32
+170 -167 +337
$296,741 $194,163 $151,572
-2.0% +1.7% -2.4%
+21.4% +12.4% +4.4%
Nye Esmeralda Lincoln
Clark
Source: Lied Institute calculations using CoreLogic Data and the State of the Cities Data Systems by U.S. Department of Housing and Urban Development. *Figures portray Three-Month Moving Weighted Averages
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Nevada’s Housing Market | March 2014
Southern Trends Single-Family Home Sales
Date (January 2000 - March 2014) Existing
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
Date (January 2000 - March 2014)
New
Existing
Source: CoreLogic Note: Series are 3-month weighted moving averages.
New
Source: CoreLogic Note: Series are 3-month weighted moving averages.
Share of Distress Single-Family Home Sales
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2013
2014
2001
Short Sales
2000
REO Sales Source: CoreLogic Note: Series are 3-month weighted moving averages.
0
Date (January 2000 - March 2014)
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Share of Distress Sales 20 40 60
80
Single-Family Distress Sales
Monthly Number of Sales 1000 2000 3000 4000
2004
2003
2002
2001
2000
0 2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
100 2000
Monthly Number of Sales 2000 4000 6000
Average Price in Thousands 200 300 400
8000
Single-Family Home Prices
Date (January 2000 - March 2014) Source: CoreLogic
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Nevada’s Housing Market | March 2014
Southern Trends Monthly Frequency 2000 4000 6000 8000 10000
Notices of Default and Repossessions
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
0
Count in Thousands 20 40 60
80
Foreclosure Trends
2005
2006
Date (January 2000 - March 2014) 90+ Days Delinquent
2007
REO 3-Month Moving Average NOD 3-Month Moving Average
Foreclosure Inventory
Source: CoreLogic
2013
2014
Actual REO Actual NOD
Source: RealtyTrac
Equity in Quarter 1, 2014
Residential Home Auctions
8000
(Home Value - Mortgage Balance)
0
0
Monthly Frequency 2000 4000 6000
Percent 10 20 30 40 50 60 70 80 90 100
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
2010
2011 Positive Equity
Source: CoreLogic
2012
2013 Negative Equity
2014
2005
2006
2007
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
Notice of Trustee Sales
2013
2014
3-Month Moving Average
Source: RealtyTrac
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Nevada’s Housing Market | March 2014 Rural Trends
Population: 147,777 in 2013 Source: U.S. Census Bureau: State and County QuickFacts
Housing Units: 66,887 in 2012
(Elko, Esmeralda, Eureka, Humboldt, Lander, Lincoln, Mineral, Nye, Pershing, and White Pine County)
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Nevada’s Housing Market | March 2014
Rural Trends Historically, the housing market is relatively stable in Rural Nevada. The average existing home price has kept around $120,000 plus or minus a few thousand dollars for the past seven years.
Humboldt Elko
Likewise, residential construction starts have historically been in the lower double-digits, with rarely any multifamily starts. This month there were 22 residential building permits filed, which is 11 more than last month, but 135 less than last year.
Washoe Pershing Lander
Rural Nevada saw a large drop in the number of REO sales and short sales, and they now represent only 10.3 percent of all single-family home sales as of March 2014. Most of the home sales were traditional as there were only two short sales and 17 foreclosures during the month.
Storey
Eureka
Churchill White Pine
Carson City
Lyon
Douglas Mineral Nye
Single-Family Home Sales* New Existing Distress Share Residential Construction Total Starts Single-Family Multifamily Average Single-Family Sales Price* New Existing Distress
March 2014 15 146 10.3%
M2M Change -4.2% +3.6% -52.3%
Y2Y Change -8.0% -26.3% -42.8%
22 22 0
+11 +11 0
-135 -27 -108
$221,644 $123,534 $104,127
+0.6% +0.4% -0.8%
-4.0% +2.7% +0.3%
Esmeralda Lincoln
Clark
Source: Lied Institute calculations using CoreLogic Data and the State of the Cities Data Systems by U.S. Department of Housing and Urban Development. *Figures portray Three-Month Moving Weighted Averages
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Nevada’s Housing Market | March 2014
Rural Trends 800
Single-Family Home Sales
Date (January 2000 - March 2014) Existing
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
50
Monthly Number of Sales 200 400 600
Average Price in Thousands 100 150 200 250
300
Single-Family Home Prices
Date (January 2000 - March 2014)
New
Existing
Source: CoreLogic Note: Series are 3-month weighted moving averages.
New
Source: CoreLogic Note: Series are 3-month weighted moving averages.
Share of Distress Single-Family Home Sales
Source: CoreLogic Note: Series are 3-month weighted moving averages.
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2013
2014
2001
Short Sales
2000
REO Sales
0
Date (January 2000 - March 2014)
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Share of Distress Sales 10 20 30
Monthly Number of Sales 20 40 60 80
40
Single-Family Distress Sales
Date (January 2000 - March 2014) Source: CoreLogic
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Nevada’s Housing Market | March 2014
Rural Trends 200
Residential Home Auctions
0
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Count in Thousands .5 1
Monthly Frequency 50 100 150
1.5
Foreclosure Trends
2005
Date (January 2000 - March 2014) 90+ Days Delinquent
Foreclosure Inventory
2007
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
Notice of Trustee Sales
Source: CoreLogic
2013
2014
3-Month Moving Average
Source: RealtyTrac
Residential Home Auctions
200
Equity in Quarter 1, 2014 (Home Value - Mortgage Balance)
0
Monthly Frequency 50 100 150
Percent 10 20 30 40 50 60 70 80 90 100
2006
0
2005 2010
2011 Positive Equity
Source: CoreLogic
2012
2013 Negative Equity
2006
2007
2014
2008 2009 2010 2011 2012 Date (April 2005 - March 2014)
Notice of Trustee Sales
2013
2014
3-Month Moving Average
Source: RealtyTrac
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Nevada’s Housing Market | March 2014 About the Lied Institute The Lied Institute was established in 1989 by the Lee Business School at the University of Nevada, Las Vegas to foster excellence in real estate education and research. Through partnerships with business and community leaders, the Lied Institute strives to improve the real estate business and effective public policy practices in Southern Nevada. The institute produces relevant and timely real estate research, supports educational programs in real estate economics and finance for students and professionals, and provides community outreach and continuing education.
Lied Institute for Real Estate Studies 4505 S. Maryland Parkway, Box 456025 Las Vegas, NV 89154-6025
Luis A. Lopez Data Analyst (702) 895-3223 Luis.Lopez@unlv.edu
About the Department of Business & Industry The Department of Business and Industry is a cabinet level agency in the Nevada State government. The Department’s objective is to encourage and promote the development and growth of business and to ensure the legal operation of business in order to protect consumers by maintaining a fair and competitive regulatory environment. The Director’s office at Business and Industry manages a number of programs and initiatives to address the needs of small businesses, homeowners and consumers including small business advocacy, bond programs, access to capital, housing retention programs, constituent services and fraud prevention and education.
Department of Business & Industry 555 E. Washington Ave #4900 Las Vegas, NV 89101
Bruce Breslow Director (775) 684-2987 Breslow@business.nv.gov
Ashok Mirchandani Deputy Director (702) 486-4492 AMirchandani@business.nv.gov
©Copyright 2013 Report on Nevada’s Housing Market Readers may reproduce the publication’s items if they cite the publication name and date, and note the copyright of Lied Institute for Real Estate Studies, University of Nevada, Las Vegas and the State of Nevada Department of Business & Industry
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