Las Vegas Luxury Properties Link

2009: A Year of Declining Inventory and Increasing Lender Involvement

During the past year, the number of available listings fell by one half, while the count of properties under contract nearly tripled. By year-end, availability reached 11,359 units, which was well below the 23,014 properties listed when the year began. Movement was primarily sourced to a reduction in the number of vacant properties listed for sale, which witnessed a decline from nearly 14,600 homes to 6,300 during the past 12 months.

The count of vacant properties listed as available was impacted bank-owned properties (REOs). At the beginning of the year, Realtors identified nearly 8,200 units as bank-owned, which represented 35.4 percent of total inventory; by the close of 2009, the number of REOs listed as available dipped to 2,246, or 19.8 percent of availability. The total number of REOs remains much higher than the nearly 5,900 listed as available, contingent or pending. Properties held by banks at year-end is estimated at approximately 12,000, while another 7,000 units remain in the foreclosure process, suggesting vacant inventory levels have the potential to remain somewhat volatile in the near term.

With vacant properties accounting for nearly 71 percent of the inventory reduction, owner-occupied inventory contributed 23 percent of the decline, while tenant-occupied properties accounted for nearly 6 percent of the market-wide drop. The aggregate decline is sourced to several factors, including, but not limited to, increased demand (sales and contracting activity), home sellers opting to wait for price improvements before listing their properties and an escalation in the number of home sales pending bank approval.

While the count of properties listed by Realtors as "available" was down materially, the count of contracted but contingent properties escalated throughout the year. Jumping nearly three-fold, contingent units rose from nearly 3,700 units at the beginning of the year, closing out 2009 with 10,761 properties awaiting some action to take place. The bulk of contingent homes (77 percent or 8,300 units) are awaiting lender approvals on short sales. Should these properties not gain lien releases from their lenders in exchange for less than they are owed, a number of properties may potentially reenter available status.

Pending units, or properties that are awaiting customary closing procedures and likely to close, fluctuated throughout the year based on market demand. As of year-end, pending units totaled 3,077, which represented an increase of 18.7 percent compared to the same time one year ago.

Overall, resale home inventory conditions improved throughout the year with inventory declines noted in 42 weeks, while increases were posted during 10 weekly counts. Foreclosures and the success of hopeful short-sellers remain x-factors going into 2010.