We are predicting house values to drop another 8-10% in 2010.  Here's why:

Housing inventory will still be at 8-12 months in 2010

Based on the number of months inventory, the following chart tells us what has happened to prices in the past. 

 

 

So if prices will be dropping, why buy now? 

When buying a house, it is more important to look at the total cost of buying the home then just look at what the price of the home is.  Interest rates are an important part of the cost of buying a home.  (More information about interest rates)