A year ago, all the housing articles were about rising home prices and how the boom could not be stopped. The dotcom mantra "Better get in now before its too late!" was recycled and used everywhere.

Today the articles are about slowing sales and the lengths lenders and builders are going to to keep people buying. Think Carl Rove, insisting that Republicans would maintain their control of the House and Senate. There are natural cycles to things and its hard to hold them back.

Home Prices Keep Sliding; Buyers Sit Tight

August and September Declines Were Largest in at Least 38 Years; Yanking a Listing in Naples, Fla.

By JAMES R. HAGERTY

October 26, 2006

Wall Street Journal

The air continues to seep out of the U.S. housing market, according to the latest data, and some economists are warning that prices will keep declining through much of 2007.

The National Association of Realtors yesterday reported the biggest drop in home prices since the trade group began compiling price data in 1968. Specifically, the association said the median price for home sales completed in September was $220,000, down 2.2% from a year earlier. That matched a revised 2.2% decline in August. In addition to being the largest price drops in at least 38 years, the back-to-back declines are the first time median home prices have fallen since 1995.

Other data gathered by The Wall Street Journal show large inventories of unsold homes and declining price trends in most major metropolitan areas.

This is a really good article on the number of people backing out of purchases. We havent had a housing drop in the past without a recession but we also havent had a national housing boom like the past 6 years. There may be good buys out there but the ground is very shaky - who knows where it will shift?

The New Word in Home Sales: 'Canceled'

Buyers Back Out of Deals In Record Numbers; A $30,000 Deposit, Lost

By JUNE FLETCHER and RUTH SIMON

November 3, 2006

Wall Street Journal

A little over a year ago, buyers couldn't wait to sign contracts to purchase homes. Now, many can't wait to get out of them.

With real-estate prices falling around the country and even pro-industry trade groups predicting further declines over the next year, buyers are backing away from deals in droves. At a semiannual housing forecast conference last week in Washington, D.C., economists reported that contract-cancellation rates for big builders were running around 40% -- about twice as high as last year's levels. Anecdotally, real-estate professionals say they are seeing a similar dynamic in existing-home sales.

Some of the cancellations are by people who signed new-home contracts at one price months ago, haven't yet closed, and are now stunned to see the builder drastically cutting prices on identical properties. Some are by speculators caught short by other investments they can't unload. And some are by people trapped in a chain reaction: They can't sell their old home -- or the buyer has canceled the contract -- so they are being forced to cancel the deal on a new house they are buying somewhere else.

"There are a whole lot of people running from contracts," says Alexandria, Va., real-estate attorney Beau Brincefield. He is currently representing more than 50 buyers who are seeking to get out of contracts on single-family homes, townhouses and condos, compared with none a year ago.

...

Cancellations by buyers of existing homes are up as well. Although no formal measures exist, historically they have been in the 2% range, according to the National Association of Realtors. In September, however, nearly half of the 454 agents responding to an online NAR survey said they had recently experienced cancellation rates higher than that.