Last month sales of homes in the Las Vegas Valley were the highest recorded. Even higher than those go go years of the middle decade. The market for many types of homes appear to be below long-run trends, so in addition to giving back the gains made during the bubble, home values have extended that into an overcorrected phase. Supply was excessive from myopic overbuilding, exacerbated by credit constraints effectual demand hurt by unemployment. Currently, the affordability scenario has improved so much that many buyers are back in the market.

Months of supply of marketed homes is now at levels not seen in years. Banks are dribbling out the inventory and many buyers have to put offers on a lot more homes before they can get one excepted. There is a lot of inventory not listed for sale but they are entering the MLS slowly. It is likely that if more REO inventory was supplied, the sales figure would be even higher. The exhibit below shows how far we are below the peak of months of supply for single family homes.

Source: GLVAR, Coldwell Banker Premier Realty.