"The market is going through what looks like a normal downward trend in the cycle," he said. "As inventory numbers continue to climb, marketing time may get longer. Calling the bottom is nearly impossible, but from where I'm sitting, it looks like we have a ways to go."

Miller is describing Mesquite in much the same way everybody's talking about Las Vegas with one exception: overall residential sales increased 10 percent in the quarter to 149 from 135 a year earlier.

That's the "Pulte factor," Miller said. The parent company of Del Webb opened its Sun City Mesquite active adult community and claimed to have 13,000 interested buyers, he said.

"The Sun City Mesquite (sales) reps say they have over 100 new home contracts. Add those sales to the numbers and we are way up compared to last year's second quarter for new home sales," Miller said.

Average price at Sun City is $160 a square foot, which is going to give local builders and the resale market "a real run for their money," Miller said.

New home building permits totaled 189 through the first half of the year, three more than a year ago. Average home sizes dropped to 1,447 square feet from 1,646 a year ago.

"Smaller units selling for less and taking longer to sell seems to be the current trend," Miller said.

Many real estate experts say the trend of smaller homes will continue as baby boomers retire, downsize and move to the Southwest. Mesquite, about 90 miles northeast of Las Vegas, is "squarely positioned" to benefit from this demographic shift, Miller said.

Gary Banner, managing director of Coldwell Banker Commercial's multifamily housing group, said the media is constantly pounding on the "housing bubble," which is not unique to Las Vegas.

Wall Street analysts and experts in the mortgage industry are warning of a "tsunami" of foreclosures coming to Las Vegas, reversing the parabolic gains in home appreciation since 2003.

It's true there are some 24,000 single-family homes for sale on the MLS, Banner said. However, he estimates that 45 percent of them are vacant.

"Most are owned by speculators who didn't get out in time from the last boom," he said. "They are an excellent example of euphoric speculation in the past real estate cycle."

The National Association of Home Builders reported that the credit crunch has resulted in rising sales losses as more consumers are squeezed out of the market.

In a national survey of builders just completed by the association, 62 percent reported that tighter mortgage lending standards had taken a toll on their home sales during the past month.

"The bottom line is that housing is hurting and it doesn't look like it's going to bounce back as quickly as we had hoped," NAHB Chief Executive Officer Jerry Howard said in a conference call.

Miller said the townhome and condominium market in Mesquite is "basically a ditto" with smaller square footage, lower prices and twice the marketing time.

The average price for the second quarter was $162 a square foot and average size was 1,146 square feet. New multifamily building permits fell to 14 through the first half of the year, less than half of the 34 permits in the year-ago period.