Las Vegas housing market is changing, again

Q: I know your newspaper column generally answers questions from homeowners and homebuyers, but I'd like to hear your thoughts on what's happening in our unusual housing market. For instance, what can be done about this apparent housing shortage?

- Nelson J., Las Vegas

A: The honest answer is that we are still trying to figure out where we are in this market. We are still trying to find out why there is no inventory.

In recent trips to Washington, D.C., I talked with people from other states that do not have laws like Nevada's Assembly Bill 284, which took effect Oct. 1, 2011, to limit robo-signing. They assured me we are not the only state with a lack of housing inventory. Still, this law has generated considerable debate about its role in reducing our housing supply to record-low levels.

There was a period a few years back when you could walk out of your office and trip over homebuyers. That was great for Realtors, but you also had to write 15 to 20 offers to finally get a deal to stick.

Then we had the down period starting around 2008, when nothing seemed to be moving and the ceiling collapsed. From a real estate professional's point of view, at least transactions were happening. Many real estate agents started building relationships with banks for the oncoming foreclosure market that we're really still working through today.

At the peak of the foreclosure market, when as many as three in every four local homes sold were owned by banks, transactions were brisk but incomes fell, as prices did the same. Realtors spent a lot of time renegotiating to accept lower commissions on home sales.

Around this time, cash-paying investors entered the market in a big way. In recent years, more than half of all local homebuyers paid cash.

But homes still changed hands and some transactions still involved mortgage loans. Some GLVAR members began to specialize in trustee sales.

Fast forward to today. We now find ourselves in a period where we still have willing buyers, but face a shortage of available homes.

We see evidence that many banks are gearing up to push short sales, which occur when a lender agrees to sell a property for less than what the borrower owes on the mortgage.

There are many homeowners out there who may never find their way back from where they are today and will need to sell. Painful as this may be, it's an opportunity for buyers and real estate professionals.

It's our job to seek out those homeowners who find themselves in that position and want to move on with life, and attempt to negotiate the best deal for them that we can with the banks and possible purchasers.

Banks are already rolling out systems designed to contact homeowners who are in default and supply them with a bank representative if needed.

Nevertheless, unless something mysterious happens overnight and houses disappear, I remind people in our profession that there are still houses lining our streets. We just need to reinvent ourselves, again. We must now look for inventory.

Local homeowners are sitting on a wealth of properties waiting to see what the banks that own these homes are going to do with them, since we all know that many distressed homeowners are not paying their mortgages.

Just as the glass ceiling appeared in the past and we crashed through it, we can count on this situation not continuing for any extended period.

Kolleen Kelley is the 2012 president of the Greater Las Vegas Association of Realtors and has worked in the real estate industry for more than 30 years. To ask her a question, email her at For more information, visit