Today there are 4,139 single family homes listed on the entire Greater Las Vegas Association of Realtors MLS that are actively on the market. That is up just little bit from the 4,113 five days ago on June 29. Bank-owned properties on the market have continued to decline during such period from 406 to 384 as have short-sales from 1,003 to 986. During that same five day period, properties that are traditional equity sale properties (properties that are neither of bank-owned properties or short-sales) on the market have increased from 2,704 to 2,769. Most of those changes can be accounted for by activity in the Las Vegas Valley (i.e. the overall the net inventory increased by 26 homes overall and by 27 homes in the Las Vegas Valley, equity sale properties increased by 65 homes overall and by 64 home in the Las Vegas Valley, bank owned-properties decreased by 22 homes overall and by 23 homes in the Las Vegas Valley, and short-sale homes decreased by 17 overall and 15 in the Las Vegas Valley).
These changes in inventory suggest that stability is returning to the residential real estate market in Las Vegas. As the inventory of bank-owned and short-sale properties has declined, people who have equity in their properties and have postponed selling are once again venturing into the market as the unprecedentedly low inventory has began to move prices up again attracting buyers into the market who wish to take advantage of the low prices before they go away.
Since May 31, there have been 3,641 sales throughout the Greater Las Vegas MLS. A rate of a little over 100 sales per day. About 47% of those sales were for cash. Apparently, a lot of investors are interested in putting money to work in the Las Vegas market. One thousand and forty-one of the sales since May 31 were of bank-owned (REO) property. Available REO inventory dropped by only about 35 homes during that period, so banks had to have put about 1,000 homes on market from their inventory of foreclosures during that period.
I know that a lot of people are still expecting a flood of “shadow inventory” to be dumped on the market. The evidence cited above, however, suggests that the banks are limiting their release of properties to the market to quantities that the market can readily absorb. Of course that filter effect may be because banks are not able to process foreclosures as rapidly as before because of AB 284, but it seems to me that the banks are wise enough to understand that if they were to dump thousands of homes on the market it would cause prices to plummet and substantially impair their capital. Bankers are first and foremost business people with fiduciary duties to their shareholders to maximize value. They probably do not want to repeat the mistakes they made that lead to the existential financial crisis of the last few years.
There is a reputed ancient Chinese curse, “May you live in interesting times.” To tell you the truth, I would rather live in interesting times than in boring ones. It is an interesting market and I am sure that there is more to come.