The Baltimore Sun reports from Maryland. "The average home price in the Baltimore region fell for the first time in six years last month, reflecting a sputtering housing market that continues to lose momentum. 'Clearly things are going to get worse, with prices likely falling somewhat, new housing starts slowing and days on market increasing. We're in for a bumpy ride, but not a fall off the cliff,' said Richard Clinch, director of economic research at the University of Baltimore."

"Anne Arundel County sustained the biggest drop, with the average price skidding 6.75 percent, the most since the market started to turn down in the last half of 2005."

"In May, the number of listings soared to 18,870, the highest since the slump began. New listings outnumber contracts by more than 2-to-1. The flood of new listings, on top of a bloated inventory of unsold homes, has squeezed prices, economists said yesterday."

"'Traditionally, this is a time when houses get put on the market, but the fact that there is a huge active inventory from homes that haven't sold is putting downward pressure on home prices,' said Daraius Irani, director of the applied economics group at Towson University's research and consulting arm. 'Baltimore is not immune to any kind of real estate home price adjustments that are going on in the rest of the nation.'"

"'Sellers had been over-ambitious with their expectations after five years of double-digit appreciation,' said Wanda Lehman, a real estate agent in Timonium. 'The sellers that really want to sell are becoming realistic.'"

"Cindy Stewart first listed her renovated 1923-era farmhouse on 1.2 acres in Lutherville in January for $720,000 after getting it appraised, but has had no offers. She has since reduced the price twice, first to $699,000, then to $675,000, added another bathroom and switched real estate agents, to Lehman."

"Stewart, who has relocated to start a new job in Florida, said she...is hopeful the right buyer is out there. 'I'm trying to stay calm, and I'm trying to be understanding about the market,' a vastly different market from three years ago, when she sold her last home in three days."

The Free Lance Star from Virginia. "After experiencing rapid growth in recent years, local home sales have slowed and continue to decline in some areas, according to the latest data from the Virginia Association of Realtors."

"April home sales in the Fredericksburg region fell by 19 percent compared to the same time last year. The Greater Piedmont area, which includes Culpeper, Fauquier, Orange and Rappahannock counties, saw about a 35 percent drop-off in home sales for April, compared to April of 2006."

"The Northern Neck, including Northumberland County and portions of Westmoreland, experienced the sharpest sales decline, 74 percent in April."

"'When you start to go back toward a normal market place, obviously you're going to have larger declines because of the extraordinary peaks,' said Lisa G. Noon, the VAR vice president for marketing and communications."

"The peaks here, and across the country, were caused by a flood of first-time home buyers entering the housing market. Lower interest rates coupled with relaxed lending rules, lead to a generational shift in potential homeowners."

"'When we had 25-year-olds out there who traditionally might have rented they saw rates go as low as they did and the opportunity to buy was offered to them,' Noon said."

"The growing immigrant population in areas such as Fredericksburg also had housing needs. 'These folks demanded homes,' Noon said."

"But the home-buying rush is over. Stricter lending guidelines have made it harder for first-time buyers to obtain loans. 'That puts a crimp in things,' said Todd Perkins, a loan officer with Fredericksburg Mortgage Co. LLC."

"The stagnate market is affecting the overall value of homes, preventing real estate owners from upgrading to larger properties or 'to refinance to fix debts or pay off cars,' Perkins said. 'The problem is the values aren't even there for that. So, we're not able to get them the money that they need because they don't have enough equity in their homes.'"

"To combat slow home sales, many builders are offering incentives or discounting optional home features. 'There are lots that are not being built on now, and there are homes that are unsold that are being offered, in some cases, at incentive prices,' said Harvey Gold, director of public relations for the Fredericksburg Area Builders Association."

"'It's supply and demand,' Noon said. 'Right now, there are more sellers than there are buyers.'"

"Noon advises sellers to price their homes accordingly. During the real estate boom, homeowners 'use to sell for higher-than-listed prices,' she said. 'They expect the same thing is going to happen even though the market conditions have changed.'"