I think an other reason to add is the time of year... Yes interest rates are low for buyers, which adds buyers..... But, on the sellers side, any one that has been in the market longer than a year knows that this time of the market slows down. No one sells houses during this time of year, compared to spring and summer time. Banks are slowing down on REO's for now. Short sales still, no matter what banks say take at least 3 months. People doing short sales most likely are buying time for the holidays and trying to post pone listing their home for sale as long as possible. Regular sellers are starting to see some profit being made but it is still a small margin, considering when you ask them they always compare todays prices with the artificial prices of 2006.