Ever wonder why there doesn't seem to be any homes being sold in your area?  Granted some areas are doing well, but a survey released today from Reuters/University of Michigan provides an insight as to one possibility.

The survey revolves around the homeowner's perception of their own home values and the headlines today stated the obvious, a record 26% of US homeowner's say the value of their hoes has fallen during the past year.  The survey also showed 21% of homeowners expect their homes value to decline in the year ahead.  OK, the news ran with that, but take a different look at the survey and you can see why homes aren't selling.

What about the other 74%?  Therein lies the problem.  You see, until more homeowners get their heads out of butts and face reality, the inventory in many localities will not move, may even increase.  This is especially true here in South Florida.

You have to wonder what 3 out of 4 Americans are thinking considering all the facts.  With the credit troubles, rising foreclosures, ARMS adjusting higher, etc., not to mention large inventories (we are around 2 years), what exactly makes them think they can get big bucks on their homes still? 

Sellers are stubborn, having too much "emotions" about their home.  They apparently still don't get that the prices during the boom were unsustainable and affordability is becoming scarcer in the process.  Not lowering your price or offering some good incentives means your house will not go anywhere and the market will remain stagnant. 

Let's all face reality folks.  Home prices need to fall in order for the complete correction to complete the cycle, then prices can begin to move higher again.  So, if your house in on the market, be realistic in your sales price so the world can return to normal. 

PS - As a mortgage professional, I don't like prices going down as it means less money per loan, but reality is reality and we all need to adapt to the changing markets.