I was talking to someone this morning and she asked me when I thought the market would recover. My thoughts on this topic are complex. To follow are some general ideas I have about factors that will lead to stabilization and eventually recovery. The 1st thing to consider is that real estate is local.  It depends on what state, county, area, or even subdivision you live in as to when you will see signs of recovery. Some areas are fairing better than others, therefore, I believe they will stabilize and recover quicker.  Another factor that will contribute to recovery is stabilization in the mortgage industry. I just read an interesting article in the Washington Post about the shift in delinquencies we are seeing with Adjustable Rate Mortgages (ARM’s). Click on the link for the full story: http://www.washingtonpost.com/wp-dyn/content/article/2008/09/05/AR2008090501448.html. Finally, prices need to stabilize and inventory needs to be reduced before recovery can begin. 

The bright side to all of this is that right now a great opportunity exists for potential buyers. Prices are down, mortgage rates are still within reach and if you are planning on buying and staying put for at least 3 to 5 years, you should be able to see modest appreciation on your real estate investment.