The Des Moines Register reports from Iowa. "Jamie Sammons was 25, married and wanted to 'stop throwing away money on rent.' He and his wife bought a townhouse in Ankeny. They paid $139,000 for it in 2002 with the idea that five years later they could sell it, get out the money they paid in and buy a house. 'It just seemed like a nice strategic move for building equity,' Jamie Sammons said."

"Now he's not so sure. With a 2-year-old and a toddler in the family, he and his wife want to buy a larger home. Sammons said they've had their townhouse for sale for about one year, gradually reducing the price to the point that he now guesses he would lose $15,000, if he can find a buyer."

"Sammons is far from alone in Ankeny, according to Heath Moulton, a local real estate broker. Moulton said he frequently meets with clients who likewise would go upside-down by that much money or more if they tried moving out of their Ankeny townhouse."

"Moulton said he thinks the Ankeny townhouse market will continue to get worse until the construction of new townhouses is slowed significantly. 'We've created such a supply,' he said. 'There's really no need for new ones' to be built at the same rate.'"

"Sammons wondered if the only solution to his family's dilemma is to wait and hope the market improves. Their townhouse is getting cramped with the two kids, he said, but they would rather not lose money to move into a larger place."

"'We're faced with two choices: either stick it out until things get a little better,' he said, 'or, obviously, turn it upside down and try to get out.'"

The Post Tribune from Indiana. "In less than 10 years, foreclosures on Porter County homes have almost tripled, shooting to nearly 500 in 2007. Former Courts Clerk Dale Brewer recorded 192 foreclosures through her offices in 1999, and that increased to 406 in 2003, the last year she had time to keep those records."

"'It looks like it started in 1999 to pick up,' she said. 'What I was seeing was all different kinds of people. It could be people are relying on credit too much.'"

"Allen Watkins, who has bought homes and offered foreclosure alternatives in Porter County for 11 years, blamed lenders being overly flexible in guidelines in subprime markets. 'When those payments go up, either people can't pay it or they get frustrated and stop paying,' Watkins said. 'It was a simple recipe for failure.'"

ABC 7 Chicago from Illinois. "If you wander by Jackson and Jefferson in the Loop, you'll see probably the biggest crane you've ever seen in your life. Alan Lev is adding eleven stories to the century-old warehouse and turning it into a hip place to live."

"Lev is also the incoming president of the Homebuilders' Association of Greater Chicago, and he knows about the perils facing Kimball Hill and other developers such as Neumann Homes, which filed for bankruptcy last fall."

"'I think in some areas there were too many units being built, and we are now seeing that there are some developers that are not going to weather the current storm. And there's more inventory in some places that the market can't absorb, and it's going to burn off,' said Lev."

"You can see the inventory around Chicago. The entrepreneurs behind developments like them face intensifying challenges: the summer's credit crunch, which has lenders being very picky about who they give money to, and falling stock prices, which make investors jittery, and a sharp lack of confidence in the economy."

"The challenge is sales, really. 'When there is so much negative news on a daily basis, it makes it more difficult to get people to buy a unit,' said Lev."

The Rockford Register Star from Illinois. "From increasing job training to revising floor plans, area home builders are adjusting in a variety of ways to a marketplace that turned from scalding hot to wintry cold in a few months."

"For the workers who build the houses the adjustments are even tougher: going from weeks where 50 hours wasn’t enough to get all of the work done, to times where they are happy if they work three days out of five."

"'I don’t think anybody knew how much housing was inflated by subprime buyers,' said Darrin Golden, business manager for Electrical Workers Union Local 364 in Rockford. 'Three years ago, the work was so brisk we couldn’t find enough people to staff it. Now our residential guys are facing 25 percent to 30 percent unemployment, and our apprentices are at 50 percent unemployment.'"

"Zentz & Associates of Rockford concentrates on the condominium market, which may be the most competitive segment as companies try to capture a share of baby boomers looking at retirement."

"When the market was at its hottest, builders had to pay premium prices for land because 'you can’t run the train if you don’t have land for the tracks,' said Founder Steve Zentz. That means some builders are sitting on land that is doing nothing for them except running up costs."

The Detroit News from Michigan. "Metro Detroit's real estate market was socked hard last year, marked by the largest drop in home prices since the Reagan administration, the third-consecutive drop in annual home sales, the lowest number of new home permits since at least 1969, and a massive wave of foreclosures that drove thousands from their homes."

"Out of desperation, Rob and Kelli Clifton of Ortonville tried swapping their lakefront home this summer without any luck. That was after they twice tried selling the home through a Realtor and reduced their asking price more than $30,000 since they first put it on the market in late 2006."

"'It's tough,' Kelli Clifton said. 'We've tried selling it as a summer home. We've renovated. We've advertised everywhere. But right now, we're stuck.'"

The Detroit Free Press from Michigan. "It sounds too good to be true. But in fact, buyers can find scores of historic, large homes available for astonishing bargains -- some under $200,000 -- in beautiful Detroit neighborhoods, deals that real estate agents say haven't been this good in decades."

"But what frustrates real estate agents and owners is the struggle to sell such historic gems -- even at these prices. And some have slashed their asking prices by tens of thousands of dollars."

"Buyers have long been able to get more house for their money in Detroit than most suburbs, but today's deals in the city are at 'a whole new level,' said said Ron Simpson, the outgoing president of the Detroit Association of Realtors."

"'I've been doing this 30-some years,' he said. 'And the prices now are back to where they were 20-some years ago.'"

"It took weeks, but real estate agent Caroline Lynch got two lenders to agree to take an $89,000 offer on a Howell condominium even though the homeowner still owed $132,000 on the mortgage. All that remained was to negotiate a discount on the $9,500 in delinquent association fees and charges from an attorney representing the association."

"But neither the association nor its attorney would budge, said Lynch. Lynch added that two prospective purchasers walked away rather than pay the fees. 'They're killing sales. It's just a nightmare.'"

The Daily Press & Argus from Michigan. "Foreclosures in Livingston County have more than tripled in the past three years, hitting an all-time high of 1,029 in 2007."

"'I am not hearing that they will be going down anytime soon,' said Sally Reynolds, Livingston County register of deeds. 'Of the people I have heard talk about it from the field, they say that this first quarter is going to be higher in numbers.'"

"As of Wednesday, Reynolds recorded 56 foreclosures for the month. 'We had 38 on Jan. 9,' she said. 'For January 2007, we had 38 for the whole month.'"

"'As far as price, there doesn't seem to be a range of prices that are being foreclosed,' she said. 'I see it in every township and in every area.'"

The Journal Sentinel from Wisconsin. "With tumultuous 2007 finally over, the residential real estate industry in Milwaukee is hoping to exhale. December was so slow that 'you wondered if your phone was working,' said Beth Jaworski, a broker and chair of the Greater Milwaukee Association of Realtors."

"Many sellers who tried in 2007 to hold out for their target prices finally gave in, evoking offers from buyers worried about overpaying, said Jaworski."

"'Reality has to set in,' said Kathleen Winkelmann, an agent in Milwaukee. She and other agents said they're working harder to craft incentives to grab attention for their listings. And asking prices are now on Post-It notes, not labels, subject to fluctuating local market conditions."

"Still, foreclosure fallout opened 2008 with another act in what is turning out to be a long-running drama, with lender losses mounting beyond even the most pessimistic predictions of 2007."

"After a record year for foreclosures, a stunning 1,000 Milwaukee County properties already have been scheduled for sheriff's sales in the first nine weeks of 2008, with a record 200 put up for sale in just one day earlier this month, records show."

"Local officials now say they are worried that the high tide of foreclosure sales - more than 2,800 properties were scheduled for sheriff's sales in 2007, a 60% increase over the previous year - could easily become a tsunami in 2008."

"'When I started in 1998, there were fewer than 800 for the entire year, maybe 20 or 30 a week,' said Eileen Carlson, a civilian employee of the Sheriff's Office who helps supervise the weekly sale of foreclosed property. 'We've already issued 1,000 docket numbers for 2008. We're already booking sales into March.'"

"'The money was easy, and people thought the value of the properties they bought would just continue to appreciate,' said Milwaukee City Assessor Mary Reavey. 'Some people just overbought and then they couldn't make the higher payments.'"

"Some people also got taken by scams in which unscrupulous brokers teamed up with appraisers to sell properties at prices far greater than the city's assessed or fair market value, she said. 'There was a lot of hanky-panky going on, and there were a lot of unsophisticated buyers who were taken advantage of,' Reavey said."

The Star Tribune from Minnesota. "Home sale prices dipped in 2007 for the first time in at least 20 years and are expected to remain flat or fall slightly in the coming year, officials from several Twin Cities-area real estate groups said."

"'It's significant in that prices declined,' said Mark Allen, CEO of the Minneapolis Area Association of Realtors. 'But insignificant when you look at long-term price growth.'"

"But the first price decline in two decades of record-keeping debunks the long-held notion that home prices in this market don't fall. Whether this decline signals a long-term trend or is just a blip is anyone's guess, but the slowdown has already left plenty of victims. The number of foreclosures in Minnesota doubled in 2007."

"Some home builders have resorted to mass auctions to unload new but empty homes."

"Condo sales in downtown Minneapolis and St. Paul haven't kept pace with development plans, forcing developers to scrap several high-profile projects. The story was similar in the suburbs, where new projects came to a virtual halt while builders and developers focused on reducing inventories of unsold homes."

"Todd Bjerstedt, VP of a data research company in Hudson, Wis., said there still is a glut of unsold new houses on the market, but that inventory levels have come down slightly."

"As of December there were 3,548 houses that were finished but not sold, he said, down from a peak of 4,552 in April. And the number of ready-to-be-built lots peaked at 42,524 in August, but dropped slightly to 42,287 in December."

"'Until this inventory is drawn down, we can't really expect normal construction activity,' he said."

"Tom Musil, director for the Shenehon Center for Real Estate at the University of St. Thomas, said that given the rapid price increases of recent years, a decline was inevitable."

"Tony Pistilli, chief retail appraiser at U.S. Bank in Minneapolis, said that even though optimists already are talking about a recovery, 2007 marked just the beginning of the market correction."

"That, combined with the fact that the market oversold itself in 2005 and 2006, doesn't bode well for price increases in 2008."

"'I don't think people are comfortable buying into a declining market,' Pistilli said. 'Time will tell. There's still a huge inventory of properties that has to get sold before people get more comfortable.'"