What is the Value of a home? Other than the value to the homeowner where the value can be measured not only in financial terms, the financial value is "what a buyer is willing to pay for it." However, a report by Zillow, shown here in a video at Marketwatch.com, indicates that some U.S. housing markets are priced 30% below the value at which the homes should be selling. Those markets include Florida, Las Vegas, Detroit, and parts of the Mid- West among other areas. I suspect that the Sunbelt areas experiencing the current severe depressed housing market are more likely to bounce back over time than some of the colder industrialized areas. This is primarily because many of the baby boomers will start retiring in large numbers, when the economy improves (retirement portfolio) and take up the slack in the Sunbelt markets.
Interestingly enough in the video, the Washington, D.C. area was singled out and is doing quite well and does not fall into this category. The biggest complaint I get from buyers is a "lack of inventory." Multiple offer situations are fairly common, especially on the best properties. If housing prices appreciate to where the seller is out of the woods on equity, we may start seeing more inventory as some of these sellers get out of their current home and head south to a warmer clime. This will in turn inject life into some of the depressed real estate markets in Florida, Las Vegas, and other areas.