Lyon County, which once led fast-growing
Nevada in the rate of its population increase,
now leads the state in home foreclosure rates.
The sour state of the housing segment
impacts business and development. County
managers feel the pinch as well.
One out of every 30 households in the
county was in foreclosure in October, reports
RealtyTrac Inc. That translates into 571 houses
in foreclosure.
The Lyon County foreclosure rate was up
716 percent from September to October and
up 1,293 percent from a year earlier. On a perhousehold
basis, it ranks 1st in Nevada, which
ranks 1st in the nation.
Across Nevada the foreclosure rate is one
of out 74 households. The U.S. figure is one out
of 452. In Clark County, 12,155 homes are in
foreclosure, half the per-household rate of
Lyon County.
The opening of Dayton's River Vista Center,
for instance, proved ill timed and the shopping
plaza on Dayton Valley Road stands largely
empty.
"We opened when this started," says Phil
Cowee, owner and president of River Vista
Properties Inc."The high foreclosure rate is
affecting commercial development.No new
homes are being built.No construction workers
are spending."
And of development projects in general,
he says,"It's a wait-and-see attitude.
Everything's stalled out."
The owner of a small coffee shop on U.S.
Highway 50 East in Dayton finds herself in
the same boat. Karen Duran, owner of Makin'
Coffee LLC bought the business 15 months
back. Traffic is off 40 percent, she says.
"Some customers lost homes and left,"
Duran says."Some come by just to talk, but
can't afford to buy anything."
An adjoining health store, Health 1st Plus
Organic Living, continues to do well, and its
traffic keeps the coffee shop afloat.
To keep the doors open, Duran works
100-hour weeks, running the shop from 4:30
a.m. until 7 p.m.Would she do it over again?
"Absolutely not," says Duran."I wouldn't have
bought it."
But not everyone in Dayton feels the
downturn. Gold Canyon Steakhouse owner
Joe France, for instance, has done well since
he restored a historic building in old Dayton
into a cozy Victorian getaway.
"We cater to a group of people who are
substantial in their lives," France says."This is
a special occasion place for when visitors
come to town. People then are willing to
spend the extra money."
But staff members at Lyon County's utilities
department are troubled by the high foreclosure
rate.
"We have seen an absolute huge increase
in foreclosures," says Mike Workman, water
director."We never used to have those. It is a
real issue for us just managing these things. If
we turn the water off, the yards die. But if we
leave it on if there's leaks or just normal
usage, we may not get paid for that.We survive
on user fees.We've been working closely
with real estate agents and have developed
special programs to leave the water on."
Fernley Public Works Department takes a
tougher stance.
"We have enough problems with bad
debts," says Bonnie Duke, finance director
and city treasurer."We don't leave the water
on unless someone's paying for it."
And when homes go into foreclosure, she
adds, some real estate agents and banks
choose to keep the water on, but some let the
lawns turn brown.
And due to the economic downturn, water
payments paid by homeowners and business
owners yielded $400,000 less than the $4 million
expected, says Duke.
In Lyon County's rural region, Smith
Valley resident Gary Garms says,"The impact
is going to be immense unless dollars show
up."He points to 60 homes for sale in Smith
Valley and says,"That's an atrocious number
for this area." And in Fernley, he adds,"It's
every other one."
Garms, who serves on an advisory committee
for Northern Nevada Development
Authority, says he sees empty storefronts and
vacant homes while he drives around the
county..
"Good Lord! I just shook my head," he
says."Who is going to clean this up? Who's
going to do what with all of this?"
Federal aid may help. Fernley City
Manager Gary Bacock says an application
filed this fall with the Neighborhood
Stabilization Program is expected to bring
$900,000 to be distributed between Fernley
and Dayton through Western Nevada Housing
Consortium, a conglomerate of cities and
counties.
Most of the federal funds went to Clark
and Washoe counties, says Bacock, but the
rural areas deemed most in need were Lyon
and Douglas counties."We were the hit the
hardest."
The money would go to homeowners to
save their properties, including some flooddamaged
homes. Funding is expected to
arrive in February or March.
But while the foreclosure situation has
slowed Fernley's former runaway growth, it
hasn't stopped it entirely.While state demographics
pegged the city's growth running as
high as 18 percent earlier this decade, it was
still chugging along at 3.9 percent from July
2006 though 2007, says Bacock. Figures
haven't been released for 2008.
Meanwhile, business owners in Fernley
are hanging on.
"We just try to be hopeful that things will
turn around," says Brenda Hoge, owner of
Mirage Garden and Gifts."The sooner the
better." She bought the store, originally
opened in 1998, three years ago. Now she
says,"It's been a tough year. It started with
the flood.And then in the middle of this year
we saw the downturn in the economy."
Mirage Garden manager Cynthia
Ceresola, says,"The nursery has seen the
biggest changes since Fernley was leading the
nation in growth. Business has been steadily
declining since 2006 but we saw a 30 percent
slide in the last year. The gift shop began as
sideline initially. Now it's prime.My first
months here, new people were coming in all
the time. That dramatically ended."
The pain of belt-tightening has spread to
the labor market.
At Fernley's Manpower employment
office,manager Donia Herrera says,"We're
seeing a lot more people coming in who have
lost their jobs.A lot of the manufacturing in
town has slowed down. Fernley is a bedroom
community; it started with the gas prices;
they couldn't afford to drive to Reno. Now
jobs are going."
