Forecast: 100 biggest markets
Analysts still are looking for a relatively mild downturn - but in some areas, things will get worse before they get better.
(Money Magazine) -- Major real estate forecasters are looking for prices to bounce along the bottom this year and next and fully recover by 2009.
"Once the correction from the boom works through, we'll see slow, steady growth," says Celia Chen, Economy.com's director of housing economics, who expects annual price gains of between 2 percent and 4 percent by 2009.
And on Wednesday, the National Association of Realtors said it expects its measure of home prices to fall this year for the first time since the group began tracking sales nearly 40 years ago.
Overall, her firm is predicting that the downturn that started in late 2005 will end up pushing median home prices down 8.7 percent nationwide by the time it ends in early 2008. The nationwide figures, of course, mask a great deal of local variation.
Regions that saw the greatest price appreciation (and speculation) during the boom, such as Florida, Las Vegas, Phoenix and San Diego, are now taking the hardest hit - and will continue to do so until all the air is out of the bubble.
While Fiserv is forecasting flat prices nationwide over the next 12 months, the firm expects price drops of as much as 9 percent in half of the 50 biggest markets. Home prices in Las Vegas, down 5 percent over the past 12 months, may fall another 9 percent in the next year.
Miami real estate could see a similar slump. The housing market will also struggle in nonbubbly rust belt states such as Michigan and Ohio, chiefly because of the ongoing loss of manufacturing jobs.