tempe is dropping like a rock. Foreclosures until recently were uncommon here, but now are sprouting up. As gilbert/chandler collapse, they are siphoning off the few buyers who might buy in tempe, leading to a complete inequilibrium between buyers and sellers. Look for prices in Tempe to continue to drop for the next year. I own in Tempe, so I'm not immune to this drop, I have 2 homes here.

It's difficult to gauge what you mean by small. So, putting words in your mouth, I chose 1000-1500 square feet. At that size, back in June and July, there were 129 properties that sold in Tempe. Those 129 homes averaged $185.50/sq foot.

In October and November, there were 58 sales. Those 58 homes had an average selling price of $189.65/sq foot.

My conclusion, small Tempe homes are holding their value fairly well. This is what I would expect, becuase there is very little competition from new construction (other than expensive high rise condos), and while there is a high percentage of investor owned property in Tempe, this has long been the case, so that has been priced into home values for years.