"Negative rent growth is likely to continue through the balance of 2009 as net population growth remains down to flat, the job market continues to adjust to new market realities and residential foreclosure activity continues," AA project manager Jake Joyce says.

CB Richard Ellis, which tracks mostly plus-100-unit complexes on a monthly basis rather than a quarterly basis, has vacancy hitting 10.96% in December and then slowly improving to 9.91% by the end of March. CBRE senior vice president Spence Ballif, a locally based apartment broker attributes that to lower rents and higher concessions as apartment owners compete against the growing number of rental homes, aka the "shadow" rental market.

Last month, the first month of the second quarter, vacancy increased again, rising 40 basis points to 10.31%, according to CBRE, which like AA has asking rents falling in the mid-2% range. When concessions are factored in rents fell much more dramatically, he says.

"The biggest issue is concessions," he tells GlobeSt.com. "If you add in skips [people turning in their keys] and concessions, effective rents declined a minimum of 10% [from the end of the year."

Part of the problem is rental homes, which are abundant due to overbuilding and the recession. The pool of rental homes likely will grow throughout the year, Ballif says. That does not bode well for the apartment market, which is still searching for a floor and is expected to follow any recovery in the single-family home market, says AA principal Brian Gordon.

"A bottom and ultimate recovery in the single family market will put a bottom in the apartment sector in sight," he says. Joyce adds that, in turn, the apartment sector's ultimate recovery likely precede improvements in other segments of the economy."

Meanwhile, there continues to be hope that Fontainebleau and some other major hotel and casino-resort developments that have been slowed will get back underway and add to the 10,000 permanent jobs expected from MGM Mirage's CityCenter development on the Las Vegas Strip.

That's good news in general but it doesn't really help the investment market, which has been nonexistent here in 2009, with no deals having actually recorded. Indeed, it may even make it worse as would-be sellers think would-be buyers should pay a little extra for the likely upside while cautious would-be buyers are focusing only on current NOI when making their offer, Ballif says.

As a result, for the few sellers currently in the market "there is still a spread between the bid and the ask price," he says.

One reason for the lack of sellers-–despite financing being available for apartment deals through Freddie and Fannie--is a lack of buyers. Las Vegas is now a "pre-review" market, which means DUS lenders are required to get Fannie and Freddie to sign off on deals prior to committing. As a result, Ballif says the terms that can be had in Las Vegas – approximately 65% leverage and a 1.35 debt-coverage ratio is a typical starting point--are not as good as can be had from Freddie and Fannie in non-pre-review markets.