This morning, we heard that housing prices had a record year-over-year plunge at 16.3%. They went on to say that “Las Vegas prices plunged the most at nearly 30%,” and some economists see no sign of a bottom. Some economists aren’t even looking for signs of a bottom on the horizon until the end of the year.

I have been listening to the experts talk about “returning to the trend line” on housing prices for quite a while now.  And it makes sense:  housing prices grew at a phenomenal pace a few years ago;  it makes sense to return to the levels they would be at if housing appreciated at a “normal” rate. So when I look at the latest chart of the Case-Shiller index, I am looking for that sort of action.

If you follow the Money Green line that represents Vegas, and hold a straight-edge up to the trend we had earlier in the decade, we are now below that trend-line. Sure, we have a lot of foreclosures, but we also have a lot less inventory than at the beginning of the year (and frankly an impending shortage of rental housing). We have under 7 months supply of single family homes, and under 8 months supply including condos and townhomes.  There are almost 2000 homes available for less than $85 per square foot. And our population keeps growing every month.

Nationally, we may indeed be nowhere near a bottom.  But here in Vegas we are in the process of putting in a bottom.  It is a slow process, and won’t be done until the foreclosure rate drops substantially — now we are merely absorbing the foreclosures and not really getting ahead of them.  But it’s in the works.