I’d written here before about how there has never been a national correction in the history of the U.S. real estate market. Well what we’re facing now is not exactly a national correction, but it is a notable occurrence nonetheless: we’re about to mark the first year-on-year decline in national median home prices since federal housing agencies started collecting statistics on pricing.

The reason that this doesn’t represent a national correction is the fact that even though the national median is down, there are still some regional markets that are flat or rising. Investors know this and we’re watching our local markets.

The New York Times writes about the housing number, and two things jump out at me from this article. The Times refers to the median drop as a national decline, stating that the statistic contradicts “widely held notion that there is no such thing as a nationwide housing slump.” This is a statement written by a journalist, not an investor. It’s not true for the reason that I’ve stated above.

A second annoyance is that the article is full of predictions, from the likes of Global Insights and Moody’s. Predictions made by economists are notoriously un-useful.

But a decline in the national median may be significant if it adds fear and confusion to an increasingly volatile lending market.  Liquidity is already starting to dry up in some areas which pulls competition out of the market.  Bad for sellers, but good for buyers.  Bargain hunters looking for a quick flip better have better confidence in thier crystal ball than I have in mine, but buy-and-hold investors in undervalued markets should have their eyes peeled for solid positive cashflow investments that will be able to weather the current storm and which will have some upside once the market turns - whenever that may be.