We just got back from the Miami Boat show and along with boats, real estate was the 2nd largest topic, and there was a lot of Australians there, along with many others.
It's really going to depend on what part of the country you (we) are talking about ... theres large areas that haven't been touched, and most of those area's property values have gone up ...
That said, let's understand some of the background first ... you had area's in California that just ran rampant, $350,000 homes were selling for $600,000 three years later and should have been selling for $380,000ish ... same with Vegas, you have houses that sold for $180,000 in 2001 and sold for $300,000+ in 2005, but should have been selling for the $210ish zip code .. the same with Florida, you have some area's that a 2,100 sq ft 40 year old canal home was bought for $165,000 in 1999 and was being sold for $400,000 in 2006 with $20,000 in upgrades, when it should of sold for the $280ish region.
But now you're seeing the market shift - like water, it seeks it's own level ... also the word Subprime gets tossed around a lot, there's a whole bunch of triple "A" borrowers out there that got talked into their situation by their agent or their lender, it was like winning the lottery for most of them - no talent, no work and huge profits ...
In all fairness, there's also a bunch of home buyers that talked themselves into the convenience of the situation with little or no homework and now they've become bleeding hearts and now are 22 minutes away from foreclosure - so sad, but that's the fleas that come with the dog.
Even though most of the folks I spoke with over the weekend have this picture in their mind of thousands of people living in refrigerator boxes and living off of Chef Boyardee ... the truth is, most are still driving their BMW's and still have their Patek Philippe on their wrist.
Most of the market is based on panic and simply bad information from for the news groups and really not knowing the market. ... once the rates fall even more in the next 3/4 months and people figure out you can't get $680,000 for a $300,000 home anymore (which is now being seen all over) things will settle down ... Boca is a good example, sellers that were asking $600,000 a year ago are now wishing they took that $425,000 offer last month.
Really depends on the area. It has not run it's course yet unfortunately. There are lots of neg-am loans that will reset soon and that will lead to quite a few additional foreclosures.
In San Francisco we are still seeing appreciation in the high single digits of median price.
Our Fed is lowering interest rates to ward off recession but credit is still tight and consumer confidence is down. I believe that consumer confidence is the best indicator to watch and with the war in Iraq, price of oil over $100 and an election coming up our consumer is not ready make any long term decisions.