Home seekers’ big dilemma: buy now or wait?

Risk of price declines keeps many from dream homes

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During the last couple of years, new listings sold in a matter of weeks in many areas. Home prices escalated at a record pace. Financing a home purchase was rarely a problem -- money was easy and interest rates were low. Few buyers wanted to miss the opportunity to make fast money in a market that seemed to defy gravity. What a difference a year makes. Now, the appreciation rate is running at a snail's pace, and declining in some areas. According to the National Association of Realtors, the median home price nationally declined a little over 1 percent in August from a year ago. This trend is expected to continue through the end of 2006. Consequently, many buyers who were anxious to buy last year are standing on the sidelines, waiting to see what happens next. Remarkably, there are still areas where the demand for new listings still exceeds the supply. In the desirable Claremont area of Berkeley, Calif., for example, there were recently nine offers on a listing competitively priced at...