Brian: I don't think it's true (and don't believe) that Ithaca is holdinng up well -- Check the Trulia site itself, you will find that almost everything is down, from average sale price to price per sq ft to median sale price. The drop rate is as large as -66%! The only up trend is "listing price". Thus mathematically it will further reduce the list/sold raito, which is more important to buyers. (The only exception is two-bedrom house market, mostly due to the larger population of young starting families in Ithaca).
My own experience has been the same. The "CMS" (comparable market survey) that I have received universally indicated that there have been about -10% reduction between list price and sale price. I am looking for 300k - 400k house market (4 bedroom).
Linda Santos' comments were based on "the same number of sales", which is important to a realtor like her, but really not relevant to potential buyers -- we care how much reduction should we offer, and how much house (sq ft) we will get with the purchasing price.
So from a buyer's point, clearly Ithaca is following the national down trend. (I also checked zillow and homegain and other sites, all pointing to the same trend) -- prices are dropping. Similarly, new housing prices are dropping in the form of "upgrades", but have not dropped as much as old houses (similar to the national trend as well).
There are quite a lot potential buyers out there in ithaca. We are just waiting. If houses are priced right (e.g., $/sq ft), they will be sold fast. (I saw several houses in Cayuga Heights were sold within months). But more houses have been sitting there for at least a year! (new houses even longer, 2-3 year!).
Disclaimer: I am not a realtor, but I have done lots of homework. I am just another Ithaca potential buyer.
Hope this helps.