Fourth-quarter sales included 13 acres of resort property, such as former sites for failed high-rises Ivana Las Vegas, Icon and Majestic. Those sites averaged $20.1 million an acre.

Excluding land sales around the Strip, the average price was $939,400 an acre, still a 20.1 percent increase from the fourth quarter of 2006.

Sales volume declined 23.1 percent from 588 acres sold in the same quarter the previous year.

Although the latest data suggest raw land prices are escalating, it's important to note the time lag between when negotiations begin on a transaction to the closing, Jeremy Aguero, principal of Las Vegas financial consulting firm Applied Analysis, said Friday.

"Most of these transactions were in the pipeline six to nine months ago," he said. "You also have to look at what the volume is and where it's taking place. A lot of it's along the south Strip and southwest. Those are the last round of history-based sales."

Housing analyst Dennis Smith of Home Builders Research said residential land prices have peaked and even receded from historical highs, especially now that home builders are selling off excess lot inventory and cutting back on new home permits.

"The big public builders are writing down their land holdings and they can do that," Smith said. "Right now banks are having a difficult time establishing land values. That means the appraisers are, too."

Smith said he knows of one large builder that bought 3,500-square-foot finished lots from Engle Homes -- whose parent company, Tousa Inc., filed for bankruptcy -- for $55,000 each.

Last summer, Smith had a small builder client who had finished lots appraised at $130,000 in the same area, near Sam Boyd Stadium, and was trying to sell them.

"I said at that time builders might give $100,000," he said. "It doesn't matter what the appraisal is. It's a piece of paper. I know what builders are willing to pay. Now you've got $55,000 lots. You've got distressed sales. That may be too strong. You've got discounted sales."

Aguero said last year's expectations that land prices would fall didn't materialize. Even though the housing market slumped, commercial development remained strong in 2007, which helped prop up land prices.

Also, the mix of properties sold has changed over time as the southwestern Las Vegas Valley has commanded a bulk of sales activity. It is very likely, Aguero said, that price depreciation has prevailed in many areas and further reductions are expected.

"Again, what are we talking about here? Both the value and the mix of transactions. When you talk about land prices, those two indicate that we will see devaluation in 2008," he said.

Aguero expects continued softness in the residential sector this year, while end-user demand for commercial and industrial space may also recede. These conditions have created some uncertainty about where land prices may be headed as feasibility remains a key question for developers and lenders, he said.

Smith of Home Builders Research said part of the next phase of our housing cycle will be banks writing down their lots.

"You have builders that are losing or giving the lots to the bank for nonpayment," Smith said. "What are they going to do with them? The banks want to move these lots. Who'll buy them? Investors. The real issue is trying to establish what values are on these lots."

In a sign of the troubled times, developer Focus Property Group recently announced that it would not make February's interest payment on $500 million in loans secured by land holdings in Nevada and California.

Contact reporter Hubble Smith at hsmith@reviewjournal.com or (702) 383-0491.