Maybe you've heard of the "$64,000 question", an old game show in the late 1950's where the successful answer earned a bunch of money (for that time). The question in real estate today might be better named the "$64 billion question". We're in a market we've seldom seen. Inventories are climbing, prices are either going down in some areas or rapidly moderating in others and uncertainty is rampant in the market. A lot of consumers, investors and real estate agents are wondering what's the next best real estate move? Planning and research are two good places to start but more on that later.

To back up a little, in successive quarters from 2004 to the present, the Office of Federal Housing Enterprise Oversight the trend from Quarter One, 2004 through Quarter 2, 2007 looks like this for year-over-year appreciation; 7.1%, 10.92%, 17.34%, 9.91%,10.70%, 14.05%, 13.18%, 11.88%, 8.59%, 5.21%, 4.65%, 2.22%, 0.33%. If you look at the last eight quarters, the trend is down, down and down. It would not be a surprise to see a negative appreciation rate when third quarter numbers come out from OFHEO. So, What to do?

Sellers need to think very seriously about their initial asking price. Price it too high and you'll get no action except for the initial "new listing" flurry of Lookie-Lou's. If your home has been on the market for a long period of time (probably more than 90 and perhaps even 60 days) with no offer, you had better think seriously about a price reduction. Remember that if you are intending to buy another home, you will likely be able to get it for a lower price than you anticipated because of these same market conditions. If you think you're going to sell high and buy low, you're probably in for a big (but negative) surprise. Have a solid strategy and be flexible enough to alter it if you have to do so. One key is not to be too greedy.

Buyers are in a better psoition than have been in for a long time and they can negotiate aggressively. Remember, however, that if you find the home of your dreams and try to be overly aggressive with a low-ball offer, the seller may decide they don't want to do business with you, so consider your options carefully. At today's interest rates, an added ten-thousand dollars of your loan amount at six percent will add about $60 per month to your payment. So, you may be able to stretch your budget a little for the home you want. A key question for a buyer is, "Am I willing to walk away from this home for another $5,10, 15 thousand. If the answer is "yes", then walk away. If the answer is "no", then give yourself some room to negotiate by offering a lower, but reasonable price to the seller. By not offending the seller, you have the chance to carry on with your purchase. Also be prepared that if your offer is accepted, you won't get buyers remorse.

Whether you're a buyer, seller, investor or real estate agent, research pricing, trends and local market risks before deciding on a starting (or ending) value for a home. Values may go down more in the near term, but real estate has been a good long-term investment through the years, especially if it is your primary residence. You get the benefits of homeownership and the potential for future gains if you are there long enough. The bigger risk lies in trying to pick up a profit in the short term because the market is still a little unpredictable. Whatever role you play in a real estate transaction, have a plan and do your research!