Distressed Las Vegas housing market may be close to bottoming out, new analysis concludes

LV housing: has it reached the "proverbial bottom"?

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The distressed Las Vegas residential real estate market - which has the dubious distinction of being home to more foreclosures than any other U.S. city - has seen a 50% drop in its resale inventory from a year ago, according to a report released today by a leading regional economic analysis firm.

"Modest movement in inventory and pricing suggests the housing market may be seeking out the proverbial bottom," concluded the report by Las Vegas-based Applied Analytics.

The resale inventory listed with area real state agents during the final week of January remained below 12,000 units, the report noted, a level that has been consistent since mid-September 2009. Vacant properties saw the largest share of decline year-over-year, down nearly 7,800 units, Applied Analytics calculated.

"Modest movement in inventory and pricing suggests the housing market may be seeking out the proverbial bottom." - Las Vegas-based Applied Analytics' "Market Watch: Resale Home Inventory"

Because of the downward spiralling values of many homes in the Las Vegas area during the past two years, lenders and hopeful short-sellers (homeowners who need to sell their homes for less than their mortgages) continue to play a critical role in the housing market's recovery: 78.5% of contracted, but contingent, sales require lender approval, according to the report. However, "it appears lenders have been more willing to accept shortfalls prior to foreclosures than they have historically," the report added. Successful short sale closings represented less than 10% of all closings in early 2009, a figure that doubled in the most recent reporting period, according to Applied Analytics' assessment.

For a summary of the Applied Analytics' report, click here.