It is funny, my wife and I were pretty much oblivious of any kind of housing bubble, peaks, valley, whatever. It was really just the last 6-8 months that I became facinated with what was happening with housing. We bought our first house back in 1992 for $89K (small cape, 1 acre, we are on the east coast). Then, in 1997, which I guess was the end of a housing valley, we sold and upgraded to a bigger house. Made a nice profit off the first house for our area, around $25K or so. Put that into the new house, 2600 sqFT walk out basement on five acres. We slammed the mortgage hard and have actually paid off this house. I must admit I listen to Dave Ramsey, rice and beans, beans and rice. It does work and gives you freedom later on. Anyway, it was just dumb luck when we bought our house that I think our area was in a housing slump. I watched the house we ended up buying. It was a new home built by a rather new builder. His first big house and I think he had stretched his finances. The asking price was $180K. My wife and I talked and said what the heck, lets low ball the price. The house had been sitting for a year since the inital building permit (they start selling them ASAP), though it was really completely finished for only about two months. We offered $145k. The realtor told us it was an insult to the seller. I said what do I care. I don’t live with the seller and the seller isn’t paying my mortgage. The realtor submitted the contract and it came back at $155k. We were like, hey, maybe we will buy this home. So we countered with $155K and the seller (builder) pays closing costs. The realtor is like “the seller doesn’t pay closing costs at this level of home”. Again, I tell the realtor, what do I care. If they want to sell this home, they got to dance. The builder, hungry I guess, accepts our contract and we have been here ever since, happy as larks. I work with someone that wants to buy a new home, upgrade from where they live. The realtors have been taking them around, showing things. A year ago the realtors were telling my friend to hurry up, multiple contracts were on the house and he needed to bid up. He was like “no way, that is dumb. I’ll wait a while and see how it all plays out.” He was smart to wait. The people that have bid up homes because they just HAD to have it, I think are really stupid. They brought a lot of these high prices on themselves.