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RISMEDIA, April 1, 2011—You’ve heard the statement many times: “There is no national real estate market.” Meaning all real estate, like politics, is local. There is, however, a national real estate marketplace. With a wide array of “products” on the shelf, there is literally something for everyone.

This feature is dedicated to evaluating that marketplace. Like the stock exchange, real estate offers a diversity of risk, return, and appeal. To borrow the vernacular of Wall Street, this feature will discuss how some markets are like stock options, and others are like blue chips. Something for every portfolio.

Stock options are a volatile, risky way to play the market; but the potential returns are great and the excitement is even greater. Representing stock options in this analogy is Las Vegas, a market synonymous with gambling. The real estate market there has been through the ringer in the past five years. If you took a look at the 10-year housing chart for Vegas, it would look like the Liberty Bell: prices rose, crested, and fell all the way back to 2001 levels. What would cause such a wild roller coaster ride? Over-development, over-speculation and lax lending standards. According to Brian Krueger, senior vice president of Strategic Services for Coldwell Banker Premier Realty, no less than 130,000 housing units were built in Las Vegas between 2001 and 2007. That development craze was fueled by a belief that if you build it, they will come, because there wasn’t prior evidence that would support that kind of demand.

Early developments sold out quickly and attracted more capital, more debt and more developers. The only problem was the group buying the units: speculators. Every time a speculator buys a unit, that unit will be placed back on the market before it can be considered absorbed. In other words, there was a false sense of demand because speculators were masquerading as buyers.

This tampering with supply and demand went bad when the market turned, and there are now thousands of vacant units dragging the market down. “The Vegas market is 30 percent undervalued right now,” says Krueger, “We are seeing investors converge into Vegas with the intent to place their bet on a great city that is in distress.” According to sources on the ground, 51 percent of Vegas buyers are all cash right now. Those are not first time buyers.

Remember, consumer confidence follows investor action. Consumers are looking for reasons not to be afraid. Investors are looking for opportunities to make a killing. They will always be first to act, and they are acting right now.

You might be thinking, “Are they nuts?” Maybe, but consider the long-term prospects for Las Vegas. Population has been growing in the city for decades, attracted by the flourishing tourism industry, and the excitement. While population is declining right now as workers look for jobs during this recession, good work is being done to bring jobs back. Nevada’s new Governor, Brian Sandoval, is actively recruiting companies from other states, like California, to relocate. “I have been given a list of CEOs,” he reports. “I have been making those calls. There are companies actively interested in locating in Nevada.”

One partner the Governor has in his corner is Zappos, the poster child for great customer service and enthusiastic company culture that has taken the online apparel business by storm. Zappos is winning awards and customers because of their culture, and the leadership of the company credits Las Vegas with helping them attract a young and enthusiastic work force. Zappos is very vocal in their support of their home-city, and people are paying attention. Public-private partnership can be a beautiful thing.

Bottom line, Las Vegas is diversifying its economic engine, attracting people and jobs, and siphoning companies and people from neighboring states. Will it work? There are no guarantees, but the future does look promising if you give it time to work.

Stay tuned for my analysis of the Blue Chip market of Raleigh, North Carolina. Not so volatile, but plenty appealing in its stability.

Greg Rand is the CEO of OwnAmerica, a company dedicated to teaching real estate professionals and consumers how to build wealth in American Housing. OwnAmerica offers a certification course for real estate agents called OwnAmerica Real Estate Investment Certification Program (OICP).