I'll defer to bagger and LHUCKS on this one. They're the PHX real estate guys.Right now, yes you are seeing 1995 prices if you want to sell in many areas of Phoenix. 65% of homes bought right now off resale listings are foreclosures, and closer to 75% if you get into the outlying areas. So any "conventional" sale of a normal home owner to a buyer is dead because you are competing with foreclosures. Many banks have been instructed to take back as much as they can and liquidate to raise capital. This means they are selling homes at a discount of their loan basis pressuring prices down to levels not seen since the 1990s. For your zip code you have probably lost 30% of value in the last year alone, but again that is basing it off of foreclosures. This is not a normalization of the market, but it is the reality for the rest of 2009 and into 2010. Unfortunately the market can remain irrational longer than some people can stay solvent, only compounding the issue. For Phoenix, from a macro economic point of view we were very strong in 2006 through most of 2008 in terms of job growth, emplyoment rates, interest rates, etc. With employment growth and in migration growth going negative for the next year at least we now have an additional downward pressure on home pricing above and beyond the speculator inventory and sub prime / alternative loan inventory. Inventory is going to be coming on the market due to job loss. I have no idea what you bought it at or what Zillow says it is worth, but I would imagine given what you said it would sell for right around $200k? If you can sit tight, I would for at least another year to hopefully not compete with foreclosures. Unfortunately when I was discussing this issue with tGunZ two years ago I stated in my disbelief that if prices fell like gunz was saying, the entire banking system would be on the verge of collapse. Well here we all are, and there is still a process of deleveraging that needs to happen.