It also takes time. Foreclosures don’t typically go for the rock-bottom prices people think they do. They’ll go for fair market value, which will likely be marginally less than recently sold comps.
As lenders over-react to the credit crisis it will be harder to get money to buy, and price drops will accelerate. As sales continue to slow, and defaults increase, putting more homes on the market, buyers who can qualify will have their pick. This snowball just starting rolling. It’s gaining speed and mass every day, and probably will for 3-4 years.