In all the talk about the housing market meltdown there seems to be this implicit belief that a "normal" housing market has significant annual price appreciation, if not quite as crazy as the past few years. So a return to normality is thought to be a return to rising prices. But it just isn't the case the home prices go up every year, and after past burst bubbles prices stayed flat for several years.
Home prices are going to fall to a level which makes sense if you aren't factoring in an expected x% appreciation every year. I try to avoid making too many predictions, but I don't think we're anywhere close to that level.
