The Arizona Republic reports on the September numbers. "The Valley's resale housing market continued to slow in September as the market struggled to find a bottom. The number of houses sold fell and, for the first time in a decade, the median price was down from the same time last year, according to ASU."

"The price drop rattles one of the fundamental assumptions of Phoenix housing: Buy a home and it will probably be worth more next year. It's another reason for skittish buyers to stay on the sidelines. 'The problem gets to be what is the incentive to move into the market?' said Jay Butler, head of the real estate center."

"It's also bad news for people who bought at the peak of the market who are finding their houses no longer are worth what they paid. 'If you bought last year and you don't need to sell, bite the bullet and wait for the appreciation,' said (realtor) Diane Watson in the northeast Valley."

"Scottsdale residents Kyle and Jaci Olsen are seeing that phenomenon firsthand. They bought two investment homes in Scottsdale last year, and one has been on the market for 10 months. They paid $415,000 for it and dropped in $40,000 to $50,000 in renovations. Now, it's now listed for $435,000 after coming to market at $499,000."

"'It's a nightmare,' Kyle Olsen said. 'It's priced really well. We've had a lot of lookers but no one is coming to the plate.'"

"The couple will list the other house this weekend. They spent $45,000 to completely remodel it, something they hope sets it apart. They bought the house for $430,000 and will try to sell it for $529,000. They originally hoped to get $599,000. 'That's how much the market has come down,' Kyle Olsen said."

"Broker Jim Sexton..said there are plenty of condos for sale and sellers are offering incentives. Sexton said it's pointless for sellers to obsess over last year's prices. They're not going to get them. 'Comparing to last year, you're setting yourself up to find a six-story building to jump from,' he said. "You can't be too greedy.'"

"Ahwatukee Foothills experienced a $20,000 drop in its median home price from August to September, according to the Arizona Real Estate Center. Ahwatukee experienced a $15,000 drop from a year ago."

"Like much of the Valley, Ahwatukee Foothills had a 'good percentage of investor homes,' noted Jay Butler. Butler said he doesn't expect the Valley's housing market to improve soon. 'We probably aren't going to see much changes coming,' he said. 'People don't really want to look for a home during the holiday season.'"

"As the prices continue to decline, some families may be in danger of owing more on their homes than the homes are worth, Butler said. 'Its really a question of how much debt did they get into their home,' Butler said. 'It'll be sort of an ongoing case thing to look at in the next several months.'"

"In September, the median price in Gilbert was $318,500. That's down from $325,000 in September 2005. The number of resale homes sold also dropped, from 565 in September 2005 to 265 last month."

"Paul Hanus is selling his Gilbert house in preparation to move out of state. Hanus said the response in the three weeks the house has been on the market has been slow, as he expected. 'We've had people look, but there's been no offers,' he said."

"Hanus said he hasn't lowered his asking price but is considering it. 'I just think there's a lot of uncertainty, and it's causing people not to buy,' he said."

"Chandler's numbers were also down year over year, falling below $300,000. In September, the median price of a resale house was $292,500, compared with $295,000 in September 2005.The median price in August was $308,000, according to the real estate center."

"The number of resale homes sold in Chandler also dropped, from 715 in September 2005 to 315 last month."

"Only half the number of homes sold last month as the same month a year earlier, according to ASU. 'A lot of it is the buyers aren't out there,' said Butler. 'The days of the big (price) increases are gone, at least for a while, so the buyer is very cautious about what they're going to do.'"

"The slowdown has caught some sellers short, forcing price reductions that still don't attract buyers."

"'It's so depressing and frustrating because I probably am like 20,000 other people out there,' said Craig Bohall, who cut the price on his family's Mesa home and offered other incentives like a trip to Hawaii but still hasn't had a buyer step up. 'You have a beautiful home, there's nothing wrong with it, but there just aren't any buyers.'"