We are ending the year on a high note.  Lending has loosened a bit and inventory is down 20% - 25%.  While average prices of homes still declined 4% in 2011, non distressed homes declined just 1/2%.  Shadow inventory... homes with financially distressed owners are estimated at 4 million units.  That will effectively keep prices from rebounding for another 2 years.  2014 is projected to see 2 1/2% increase in home prices.  Wish I could say the same about interest rates!  Rental property will continue to be the strong segment of the market as there will remain a high demand for rental homes.  Locally, we have seen an influx of people taking their money from nonperforming investments and buying rentals.  It may be hard to get a 2% return on your savings, but the same money invested in a rental could easily return 15% - 20%.