Glen Dorfman of the Minnesota Association of Realtors recommends that sellers accept the market for what it is, and not hold out for a recovery. For example, for the week ending May 12, the number of sellers with offers was down more than 20 percent from the same period last year, while the total number of homes on the market was up nearly 12 percent from a year ago.

"Right now we're in a frightening time of flat and declining market values, so why not cut losses?" says Dorfman.

Dorfman says market conditions are more likely to get worse than better if, as expected, the rate of foreclosures continues to climb. That would dump even more homes on an already saturated market, pushing prices down further.

"I've been saying to everybody who will listen, if you have your house on the market and your realtor tells you to update the living room carpeting, or stage it more exacting than you might otherwise, then you should do that," says Dorfman. "And if you need to reduce the price today $10,000 to $20,000, it's far better to reduce it 10 or 20 than in six months having to reduce it 70 [thousand] or 80 [thousand]."

Others are less pessimistic about real estate prices. Tom Musil, head of the real estate program at the University of St. Thomas, predicts the market won't stabilize until late next year. But even then, he cautions not to expect a return to boom times.

"You have to realize the feeding frenzy that we were in from '98 to about 2006 is going to be hard to repeat," says Musil. "We saw tremendous increases in values and in a short period -- maybe eight or seven-year period -- and when you see houses increase 250 or 300 percent, that's pretty tough to match." Musil, along with the other real estate industry experts, also says that, while statistics show a struggling market overall, the conditions vary from neighborhood to neighborhood.

Source: http://minnesota.publicradio.org/