Trader Mark over at Seeking Alpha also shares the same point of view many of us have, until prices become affordable again, we will not see the “bottom of the market”. Period.

Many people think when prices come down by 30% the market will have bottomed out and buyers will come back led by lenders feeling they can release money without fearing prices coming down and losing on their investments. It’s just that simple. Only then, people will be able to afford homes and not stretch themselves as they have over the last few years and put this economy into this mess. Harsh words, but real. It’s pure and simple economics.

“Until prices come down to a level where people with 5-20% down, 6% fixed rated, making normal American incomes can afford, we are nowhere near a bottom.” It just makes plain old sense, doesn’t it? No one can afford ever climbing prices when the personal economies don’t follow, salary raises don’t follow, Americans still don’t save money, commodities such as gas, eggs and milk (the bare essentials) are rising quickly, lenders are too skittish to lend money in a market where homes lose value and see their investment melt like snow in summer, and the list goes on.

“…new home starts are finally slowing, and home builders in desperate attempts to see a cash flow, have slashed new home prices. We now are going to face an almost comical dichotomy in some markets – new homes selling for 30% below existing homes… This just means that existing home sellers are still in the denial stage and think they can get 2005/2006 prices. This is why your ‘median’ prices are not falling.”

Until then, I agree, expect a lot of “experts” to say we have reach the bottom of the wave because the numbers from the previous months were positive. If you look back, many have predicted this for over a year and look at the current situation. Eventually, one of them will get it right by saying it at the right time

Again, there is nothing pessimistic about this, it’s more about curbing an unbridled enthusiasm. It’s about being realistic and mature. Making a profit can only happen when there is an economy both personal and national to back it. In this case, it just isn’t so. Prices have greatly appreciated and even going down by 30% for those who bought at least ten years ago is still a substantial gain. For the rest, welcome to the world of investing. You win some, you lose some.