Drunkle: Flipping a house in a year is not a long-term investment, but for the majority of buyers out there they are looking for a home to live in not flip. For those buyers, they need to realize that real estate IS a long-term investment. It is true that you make your money when you buy and get paid when you sell, but if you plan on holding for several years the market will rebound as it did after the housing slump in the early 1990’s and prices will surpass the original purchase price. Case in point, my parents bought a new home in SD in 1986 for $131k and it peaked at around $250k in 1990 or so. They ended up selling in 1992 when the market was softening for $217k and bought a new from builder for $235k which was sold in 2001 for $422k well before prices starting shooting through the roof.

I can send you the MLS listings for the two homes I sold in 2007 if you’d like. Drunkle, I take it you did not make any money from real estate in 2007 and won’t be in 2008, either.