Harry Dent is very pessimistic.
Given that real estate is so local, the best way to gauge the downside potential of your home or commercial real estate is to find out what it was worth at the beginning of 2000 at best and the beginning of 1996 at worst. If you can’t take that much heat consider selling and renting for the next three years plus.
Read his op-ed here: Greatest Real Estate Bubble In Modern History Not Done Bursting - Forbes.
Is he right, or is there something different this time? Are the Fed's policies and the renewed regulations going to keep things from hitting pre-2000 values? There's a great deal of unwinding yet to do; and many major players are pushing austerity, which will help to continue the unwinding Harry suggests. Certainly though, various locations have already fared quite differently.
Places that experienced the greatest boom generally suffered the greatest bust. Whether or not a location is in a judicial-foreclosure state also has impacted how quickly the area's real estate market has begun to recover. Phoenix is a prime example of a boom-bust city that's made a quicker recovery because Arizona is not a judicial-foreclosure state. Foreclosures there do not have to be processed through the courts, clogging them, slowing the process.