I personally think that actual sale prices are not the best indicator for a falling market. Although they are the most direct factor pointing to declining prices, they inherently lag behind other factors such as inventory and days on the market. They also do not provide a large enough sample set, in my opinion. Of course, there are inherent weaknesses in choosing the other indicators as well, but these weaknesses rest squarely on the shoulders of those in charge of the database listing services. It is worthwhile, then, to also look at the data pertaining to expired, cancelled, and withdrawn listings.
As strange as it may sound, the prices have already dropped 15-20% in the eyes of consumers. It just takes hard data and market forces to catch up to this perception.
