The market is affordable but not imploded.
Too many buyers and investors these days seem to think because of bad press and high rate of foreclosures and unemployment that means they are going to get some kind of "Killer" or "Special" deal. Well to be honest... YOU ARE!
When you take incredible prices not seen in over 11years and combine that with interest rates at historic low levels of 50-60yrs you are setting yourself up for some once in a lifetime opportunities in Real Estate but that does NOT mean you are going to buy that Million Dollar Dream home for 250k! No bank is going to cut losses on assets at that level and no seller is either. The market is FULL of opportunities, good ones, even great ones but ridiculous ones you better reposition that thinking, so you don't offend every Realtor you meet and every seller or bank you attempt to negotiate with or make offers to.
Assess the REAL value of the property and decide what is a solid investment and a fair deal that actually may get accepted. When you get your number make that offer and, if accepted, KNOW you are getting a great discounted deal. Combine that with 30yr fixed rates in the 4's and you have a FANTASTIC deal! But thinking that place is going to be bought for 25 cents on the dollar or some even offer less??? Thats simply a waste of time and an insult to the other party.
I am not saying you have to pay asking or full price but you must do your due diligence and you must make your offers reasonable and fair, if you really want the property that is. If all you want to do is low ball every place, you aren't looking for a home, you would be better served buying the next, hot, penny stock(they are cheap) and take your chances on it going from .10 to .15 and increase your investment by 50%! You will have far better chances of doing that there than you will in today's improving market.