According to the National Association of Homebuilders, home prices are more affordable then in the last 4 years. Sales are also up 3% from June to July. However, buying has not increased to the level at first expected or hoped for. There are a number of factors to explain why.

One big reason is price, medium home prices have fallen since they spiked at $230,100 in 2006, going down 8% at $212,400. However, this is still 39% the cost seen in 2001 before the market boom and prices seriously inflated. At least, according to a July report done by Wachovia, median home prices are expected to fall 20% by the end of 2009, averaging about $185,000. The chief U.S. economist with Global Insight, Niguel Gault related these occurrences to the buyer sentiment seen today, "Houses may be more affordable, but they will probably be even more affordable next year,...So why buy now?"

Besides home prices, Michael Larson, a real estate analyst for Weiss Research,(a investment newsletter), says that "Price is just one of many variables that go into a decision to buy a house,...Many other factors are overriding price right now. That's why the market remains challenged." While prices are starting to lower, the difficulty level to borrow is not. The president of the National Association of Mortgage Brokers, Marc Savitt, remarked that "The industry went from little or no credit standards to credit standards on steroids,". Data from the Federal Reserve Board, shows that around 85% of lenders, have tightened buyer requirements during the last 3 months, due to fear incurred from the lower prices,rising foreclosures phenomenon. Keith Gumbinger with HSH Associates remarked that for buyers with a credit score at or under 600, getting a loan is almost impossible.

Also, toss the idea of buying aside for anyone who has a credit record, which equates to almost 21 million or 13%. Also, any who do have a qualifying credit score will probably be paying more then before. Fannie Mae and Freddie Mac, at the start of November will require a credit score of 740 (previously set at 680) for all buyers, to let them off from paying a surcharge that would increase their interest rate. This roughly means that 33 million of the U.S. public (20% of adults with credit history who have scores between 680 and 740) will have to pay .5% more to borrow.

Lenders are also changing how they handle down payments. They want a least 5%, which is a lot more now then prior to the market boom. Higher interest rates also lower the amount borrowers are able to borrow. Forget about option ARM´s and other teaser rate mortgages that let borrowers in essence stretch to buy something out of their price range. Today, ability to re pay the loan to be taken, is something looked at and strictly evaluated.

The spokesman for the National Association of Realtors, Walter Molony, spoke about the buyer mindset, "Nearly a quarter of potential buyers are on the sidelines waiting for some form of encouragement,". Based on data from Gallup, the amount of Americans who think that real estate is a safe investment is at 27%, 50% less then in 2002.