The good news is we're still in a housing recession. Why? Opportunity. Even better news -- the worst markets are starting to see signs of life. That means the window to get the best buys will soon close.

The California Association of Realtors most recent report notes that state-wide inventory is going down from 11 months on hand a year ago to nine months. That's faster than the national average, folks, which has climbed to 11 months, according to the National Association of Realtors.

Even foreclosure-heavy Detroit is sporting better numbers -- pending sales have increased 26 percent says RealComp II, a broker-owned MLS.

The reason sales are slowly turning around is that smart homebuyers recognize that prices will recover. They'd rather benefit from the next boom than see the current seller get it.

Think about it. When have you ever seen housing retest previous lows? This past year is the first in decades in which housing prices went lower. Typically, housing prices beat inflation by one or two percent

The 2007-2008 housing recession is an anomaly. You've seen housing prices retreat as far back as 2004 in some locales, but you don't see them retreating to 2000.

In 1991, home prices crashed more than 12 percent, according to economist Robert Shiller. The NAR said housing prices gained by $5000 over 1990.

By 1992, inventory had built up to 8.5 months on hand. Only a year later, inventory reduced to 6.2 months on hand. By 1995, a buyer's market was in full swing, with only five months of inventory on hand.

To put that in perspective -- even at the top of the housing boom in March 2005, homes on hand never dipped below four months on hand.

It gets better. In the four-year recovery period between 1992 and 1995, home prices rose $38,225, or 39 percent.

But this time it's different, isn't it? No. It isn't.

Residential real estate rose 20 percent between the volatile years of 1990 to 2000. After that, it doubled through 2007.

But like all booms, reality sets in, and resistance to price becomes an issue.

With home prices eight percent below a year ago, or 15 percent below if you prefer Shiller's numbers, buyers are starting to think strategically. Why? Because busts never last, either.

With still near-record inventories, low interest rates and lower prices are making home ownership irresistible again.

And we all know what happens next. Lower inventories are invariably followed by higher prices.

Smart homebuyers know to buy on the news and the worse the news is, the better price they'll get. They're willing to take a short-term equity hit because they still get terrific tax subsidies in the interim. Once real estate prices turn around, they have both. Plus they're in a better house.

That's why homeownership is a long-term strategy.

Ask yourself -- do you want the next wave of equity, or do you want someone else to have it?

Published: May 30, 2008

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Blanche Evans is the award-winning senior editor of Realty Times, the Internet's leading independent real estate news service. She is featured daily on the Realty Times Video Network in the "Realty Viewpoint" segment. Blanche has been named one of the "25 Most Influential People In Real Estate" by REALTOR Magazine, and has been twice recognized as a "notable." In 2005, she was named "Top Reporter Covering the NAR" by Delahaye-Bacon's. Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. To contact Blanche, email her at . For more articles by Blanche, click here.