Of course things are slow!
Remember the last boom? It ended in 1989-90 (analogous to 2005-06 today), and prices dropped for many years until 1996. If you wanted to buy at the bottom then, you had to be patient, as in six-years-patient! Prices dropped very slowly in the early 90s, even though we lost many jobs in the aerospace and related industries.
No one knows how long the decline will last this time. It could be only two years, or 10 years, or more. Also bear in mind that a lot of the housing depreciation will be in real (inflation-adjusted) dollars.
Prices are very sticky on the way down, and I’m convinced that houses will remain overpriced for years. It think it’s smart to rent for at least the next couple of years. Rent is cheaper than you think. As an example: my wife and I almost bought a $900K house in 2005 after a job relocation. A house with an identical floorplan is for sale today, listed at $845K after many reductions, and still doesn’t sell! And this house for sale now has much better upgrades (flooring, landscaping, etc.) than the one we almost bought.
I figure, the $50K+ I would have paid (lost) for the “pride of homeownership” will pay for almost 2 years of my rent. It’s as if I’m renting for free. Besides, I’m convinced that that house can easily lose another $50K within the next 12 months. The way I see it, more free rent for me!
