When will we see 2007 prices and sales volume?

Many experts say a return to 2007 prices isn't likely in the foreseeable future. Given the unique and artificial conditions that fueled the well beyond inflationary two year run-up, repeating that level is not likely.

Since many under-qualified buyers were placed in risky mortgages (due in part to the poor performance of the stock market for investors), a bad situation of unsustainable growth occurred that had to result in disaster for many caught in the down slide when prices corrected.

After all the pain, we now have numerous lending controls in place to limit loose risky mortgages and home purchases to only truly qualified buyers, Therefore any repeat of wholesale flipping and associated price spirals is very unlikely to return.

On the bright side, many economists believe that a return to a normal 4-5% per year appreciation may be not far off.

Historically properties have on average risen around 4% since WWII. This alone would suggest that when the current correction is complete we will once again be able to plan our real estate portfolios with some degree of confidence.