We read so many posts here on Activerain, about the market, the inventory, the lack of buyers, frustrated sellers, the economy, and the sub-prime mortgage industry, foreclosures, and the media.
There is tons of finger pointing.........the buyers signing things they didn't understand, the lenders for selling mortgages to uncredit worthy people, the appraisers for appraising houses higher than they should have, Realtors pricing too high. We have seen and read it all.
As a licensed Broker, in Ann Arbor, Michigan, we saw the market turn back in summer of 2001. Yes, I said summer of 2001, before 9-11. For example, I had a client who had purchased a home in Saline, Michigan in 1998, the market was HOT. They made several offers on homes and weren't able to get them. or they were gone when they went back a second time. They learned the hard way that if you find a house, you better make an offer right then as it wouldn't be available when you wanted a second showing.
So they purchased a very dated, shag carpet, orange and brown wall-paper house on 1 acre with a swimming pool. You could literally stand in one room and see 5 different colors and patterns. However, they were excited to finally be in their home.
Over the next three years they updated everything. All the tacky wallpaper was removed, new neutral paint everywhere, new light fixtures, beautiful landscaping, and new appliances. The house really had a "face-lift". It was hard to believe this was the same home. 
My sellers had a new baby and wanted to move into a larger home, so we found then a gorgeous new home in a new sub-division. I put their older home on the market, at the lowest comparable price. After showing them the comparable solds, they wanted to go the lowest so they didn't risk owning two houses.
Welcome to 2001 in Saline, Mi.
The dated house sold 3 days on the market, the remodeled house took 6 weeks. In Saline, before the economy shifted, homes were gone it a week. It was so much fun!! All the sellers were happy, happy.
Realtors "felt" this shift first. At the time Ford, GM, and Chrysler were "restructuring". Which is a nice way to saying, they were starting to lay off lots of employees. Those of us in Real Estate thought this would be a temporary slow down and then 9-11 came. Oh, at first, we didn't really notice much, all the Big 3 were giving tons of rebates on cars and the housing market was moving along steady just taking longer to sell.
The "housing boom" according the national statistics officially ended in 2004-2005. But, in Michigan it ended way before that.
So how will we know when the market is going to turn? Not, just here but in your towns and communities?
According to John Tuccillo, former National Association of Realtors, Chief Economist, between 1987 and 1997, "you can predict that change is coming when you see a correlation between jobs and people." For instance, Michigan is still losing people. Our population is declining, and then you compare that to my favorite place on earth, Nashville, TN. Nashville and all the suburbs are growing. Our home prices are declining, Nashville is stable. There is a direct correlation between people and jobs.
How can we as Realtors know when the sift is going to occur from a buyers market back to a sellers market or a stable market?
The MLS!
Yes, you heard me the MLS, that old antiquated system, (tongue in cheek) we have access to all the data. The consumers have access to the listings but not all of our data.
Look in your MLS for these 4 things:
•1) The number of new listings coming on the market goes DOWN. Inventory starts to decline.
•2) Decline in the Days on the Market, or DOM.
•3) The difference in the List Price and Sales Price ratio.
•4) The number of homes that are selling without a price change.
Sellers start to get realistic, if they can't get what they want for their home, they don't put their home on the market, builders stop building spec houses, homes start to sell faster, and those houses selling are closer to the original asking price. Buyers start to think, if they don't buy now, they will miss the market.
There are plenty of buyers out there..........they are waiting. 
There are homes selling in Ann Arbor and Saline, Mi. They are the homes that are the lowest in the neighborhoods. I see it everyday. At first, it was the Pfizer homes selling the best, now it is the lowest price homes, selling first.
Are we there yet? Not in Ann Arbor or Saline. But, the amount of homes being listed is decreasing for the past two months, so that is a good sign. One down, three to go.
To Search for Homes in Ann Arbor or Saline, MI, click here.
Posted by 
Missy,
I hope you're right and your market comes back strong. It'll take a paring down of the homes on the market for the shift to pick up speed and it sounds like you're starting to see it. It takes a smart and alert Realtor to have their finger on the pulse of their market. If there's anyone who would know about Ann Arbor, it's you!! Good luck!!