New Home Sales have collapsed to record lows, and Existing Home Sales declined in May. The Big Picture has a brief recap of the national housing/credit bubble and explains why prices will continue falling due to
[...] traditional metrics. Whether we are looking at US housing stock as a percentage of GDP or Median income vs home prices or even ownership vs renting costs, prices remain elevated. Indeed, we see prices remain above historic mean.A Forbes Op-Ed by Richard Suttmeier points out There is no double-dip, just a continuation of the Great Recession.
Consider price relative to income. From 1977 to 2010, the median US home price was 4.1 times median household income. But as the chart below shows, Home prices are still above that mean. Oh, and that mean is artificially elevated due to the 2002-07 boom. Same with home prices relative to rentals, or housing value as percentage of GDP.
Sellers might want to ignore national data or projections, but local buyers know they shouldn't. It's all connected.