You don’t know what prices will do. It is possible that some people could just be trapped in their homes for years. They bought at the peak of the bubble, also took out a HELOC. So, they can’t lower their price without losing their shirts. I could see where many existing homes stay priced high and just never sell or get pulled off the market. And new home prices start dropping. Hopefully most people that bought homes in 2005/2006 plan to stay in them for a good while, or they are screwed. Also, they will have to deal with seeing friends purchase similar homes for much less money.
