The Desplains Times reports from Illinois. "Last month Dan decided to stop paying his mortgage. It was hard for him. Dan, who is in his 20s and grew up in Chicago's Edison Park community, paid all his bills, always on time, and is proud of it. Dan started looking for a place of his own with his girlfriend in 2004 and 2005. They fell in love with a 900-square-foot townhouse in Schaumburg. They settled on a final price of $179,000, a bit expensive but still reasonable, he thought."

"'Prices were rising, inventory was decreasing,' Dan said. 'I had this mentality that if I didn't buy something now, I'd never be able to afford anything.'"

"To finance the purchase he obtained two mortgages, one for 80 percent of the purchase price and the other for 20 percent. Dan's loan would be fixed for two years, an Adjustable Rate Mortgage."

"'I was so sure prices were going to go up,' he said. 'It was a ridiculous product. It had all these balloon payments.'"

"Then Dan, who had worked in downtown Chicago, lost his job. At the same time the adjustable mortgage was threatening to take his monthly payments from $1,475 to $1,720."

"He moved with his girlfriend, who has since become his wife, to Jackson Hole, Wyo., where he got a job working as, ironically, a real-estate agent. They listed the Schaumburg townhouse for sale at $175,000 in November 2007 but received no offers even though it was less than the original purchase price of the property."

"All the while because of the rules of the property association, Dan was barred from renting his townhouse even though he had moved out of state. 'It's extremely frustrating, everything I'm going through trying to hold on,' he said. 'I can't spend every dollar I have paying the bank when I have a daughter on the way.'"

"Dan said when he first moved he thought the condo would sell within 90 days. 'My condo's been on market since November and the prices keep dropping,' he said. 'They go down by about $5,000 every month.'"

"Dan's credit score has been reduced from 750 before he purchased his townhouse to about 600 now, but he's philosophic; he believes he has to plan for the future now, with his wife and yet-to-be-born daughter."

"'I just think that people need to hear about this,' Dan said. 'If anyone can learn something from it then it's worth it. The cycle could come around again in another 20 years and maybe some young guy will read this and think twice.'"

The Evanston Review from Illinois. "Median home prices in Evanston rose 60 percent between 2000 and 2006, pushing home ownership further beyond the grasp of many middle-income wage earners, according to a study presented Monday to the City Council's Planning and Development Committee."

"Using a standard rule that buyers can afford to spend three times annual income, a family earning the median income of $62,000 in 2006 could afford a home priced at $186,000, according to the study. But the median price for attached condominiums and townhomes that year was $276,500, and the median price for stand-alone homes was $550,000."

"'Many people who live in Evanston, work in Evanston and grew up in Evanston are finding themselves priced out of the market,' said Housing Commission chair Susan Munro."

"None of the new construction that has taken place in Evanston over the past two years has produced housing affordable to low- or moderate-income families. In 2007, the lowest sales price for a new condominium or townhome was $242,000 and the lowest sales price for a new detached home was $781,106, according to the report."

"Keith Banks, director of the Evanston Community Development Association, spoke to the reasons why developers are forced to rehabilitate smaller condominium units."

"'It takes $250,000 to $300,000 just to purchase a 'teardown' in the 5th Ward and you are not even talking about knocking down a wall or renovation' -- which can add another $200,000 to the cost, Banks said. 'Then you are talking about a half a million dollars and it's already not affordable.'"

From WPSD TV in Illinois. "Sherri Wiegand is taking the first step to a new home. She can afford to be picky. If she doesn't like even the most trivial thing about this home, she can look at another 30 in her price range."

"The numbers tell the story. Sales are down by 84 homes in Williamson, Jackson, and Johnston counties in Illinois from January to June 10 this year, compared to last year."

"These trends mean sellers are more willing to negotiate with buyers. 'That $150,000 home last year may now be only available for $120,000 to $125,000,' says the Broker and Owner for Century 21 House of Realty in Marion, Illinois."

"Any good news for buyers is always bad news for sellers who've watched the value of their home drop. Wiegand is one of those people. She's has a home she needs to sell, but the options are just to good for her to pass up."

"It's not all good news for buyers. Lenders are raising their standards. Buyers have to put more money down and have higher credit scores. 'All the unique programs to bring people in and get them mortgages have disappeared. It's back to the banker holding the key and having expectations of the buyer,' said Davis."

The Ann Arbor News from Michigan. "In what could be a sign that the local housing market is finally on the mend, numbers released by an Ann Arbor Realtors group Tuesday show Washtenaw County home and condo sales jumped 24 percent in May from a year ago."

"Prices, however, aren't doing so hot. Short sales, foreclosures and the aftermath of a previously bloated stock of inventory have pushed the average sale price of a home in Washtenaw County to 2000 levels."

"Median home sale prices fell nearly 8 percent both in the month of May and year to date compared to last year to around $187,000. Year to date, the average home sale price sank to $216,882 from $239,028."

"'The biggest thing I am hearing is that the inventory is almost depleted,' said Sharon Snyder, president of Prudential Snyder and Co. Realtors in Ann Arbor. 'My agents are busy and they just wish there was more product on the market. So we'd like to invite sellers to put their house on the market.'"

"Part of the reason for the drop in inventory levels has to do with Pfizer, and part has to do with price. Last year at this time is when real estate agents say a load of homes owned by Pfizer employees came on the market. Last summer, Pfizer began to relocate and lay off employees in two-week waves as the drugmaker worked toward shutting down its Ann Arbor research site."

"And as home prices have dropped, many potential sellers - especially those who bought in the past few years at higher prices - are waiting to sell until their home values appreciate."

The Pioneer Press from Minnesota. "The large for-sale inventory dogging the Twin Cities housing market may finally be burning off. Total listings in the 13-county metro area dropped in May from a year ago - the first such decline in years."

"Challenges remain. Closed sales declined more than 13.4 percent in the metro, and in Dakota County they fell by more than 22 percent. Sales still were down from last year, so the area now has a 10.4-month supply of homes on the market. That's up a tad from the 10.2-month supply in May and is up 13 percent from 9.2 months a year ago."

"Meanwhile, the area's median sale price continues sliding. It fell 10 percent last month from May a year ago, to $205,000. From a buyer's perspective, of course, those drops are great news."

"'Everybody's gun-shy,' said Tom Hamilton, a professor of real estate at the University of St. Thomas. 'Nobody has faith in the credit-rating agencies. We're in the hangover phase.'"

"The bigger threat now to housing, said Chris Galler, chief operating officer of Edina-based Minnesota Association of Realtors, is consumer anxiety about rising food and gas costs. 'Uncertainty is the worst thing for our market,' Galler said."

From NPR Morning Edition on Minnesota. " As a crime prevention specialist for the Minneapolis Police Department, Tim Hammett knows firsthand the toll that the mortgage foreclosure crisis has taken on the city's North Side. Sometimes it even follows him home."

"One day not long ago, Hammett pulled up in front of his house to find a woman ripping the aluminum siding off the empty house across the street, which, like hundreds of North Minneapolis properties, was in foreclosure."

"'I walk up to her and I said, 'What the heck do you think you're doing?' he recalls. 'And she gives me a look that's like, 'This place is empty. Nobody's living here. Who cares?'"

"When the real estate boom struck earlier this decade, investors began descending on the area, buying up houses to rent out. They liked the quiet, tree-lined streets close to downtown, and the huge supply of inexpensive old bungalows and Tudor-style houses."

"As the boom continued, house prices soared, and many longtime residents drifted away, to be replaced by a tougher and less stable crowd of renters, says Joel Breggemann, a block club president on Dupont Avenue North."

"'We were seeing blatant drug dealing,' Breggemann says. 'We were seeing residents who spent their entire day out on the front step of the house drinking, from 8 in the morning to 2 o'clock in the morning, and would have their car parked out in front of the house with music blaring.'"

"Many of these houses ended up in foreclosure when interest rates reset and property values returned to earth."

"The troubles have been greatly aggravated by an unusual amount of mortgage fraud, says Assistant U.S. Attorney Joseph Dixon. In one of the most notorious cases, a suburban real estate company, T.J. Waconia, bought numerous houses throughout North Minneapolis, using fraudulent appraisals, federal officials say."

"The firm's founders pleaded guilty to mail fraud this year, and 141 of its houses were placed in the hands of a court-appointed administrator. Those houses now sit empty, contributing to the huge glut of abandoned properties and compounding the crime problem."

"If not sealed up adequately, many of these vacant properties get taken over by gangs, who use them for drug-dealing and prostitution, says Sgt. Richard Jackson of the Minneapolis Police Problem Properties Unit.'

"'It brings a lot of the criminal element into the area,' Jackson says."

"'Unfortunately, when America catches a cold, neighborhoods like North Minneapolis get pneumonia, and foreclosure hit much harder there than other parts of town,' says Minneapolis Mayor R.T. Rybak. 'We know these neighborhoods, which have very good housing stock, can attract good, solid homeowners. The problem is that we have been dealing on such a large scale, because we have so many of these foreclosures.'"

"But the collapse of real estate prices in North Minneapolis threatens to undermine the city's efforts. Some foreclosed properties are now selling for a small fraction of their peak price, which is drawing a new generation of investors to the area."

"City officials fear that an overwhelming number of these houses will end up as low-income rentals, making it that much tougher to bring the neighborhood back."

The Star Tribune from Minnesota. "Wells Fargo Bank has hired a commercial real estate broker to sell about 300 residential lots in two distressed Twin Cities area developments, the latest sign of tough times for area home builders."

"The Martin Farms property includes 150 vacant developed lots and 108 acres of residential land. The asking price is $10.2 million, according to a news release by the Twin Cities office of CB Richard Ellis, which is marketing the property."

"That's substantially lower than the original $75,000 to $110,000 asking prices for the lots, according to Charlie J. Pfeffer, a sales associate at Pfeffer Co. Inc., a Maple Grove land broker."

"'That's a pretty big bite,' Pfeffer said of the sizable acreage being put up for sale. He estimated that the property represents five to seven years of inventory for residential lots in the Otsego area."

"Conceived in 2003, Martin Farms was of the most ambitious new housing projects in Wright County, with plans for up to 350 houses. The project's investors spent $34 million on the land and infrastructure improvements."

"Wells Fargo provided stagecoach rides at the project's grand opening marketing event. On May 1, the lender took back the project as part of a workout agreement."

"Only 50 of the lots at Martin Farms now have houses, and 10 of those are vacant."

"'This was a horse that was conceived when the market was going nowhere but up,' said Jeff Schoenwetter, a manager of Insignia and an investor in both Martin Farms and Tullamore. 'I have no regrets about how the decision was made. I only regret that we did it.'"

"'I've never seen a market decline this abrupt,' Schoenwetter said. 'At the time these projects were conceived ... they looked like relatively intelligent business decisions.'"