The reaction received upon discussing the positives of the current state of real estate and credit markets is one of high skepticism and cynical looks and followed by a quick "Are you crazy?" response.

I really don't blame them.

The media is absolutely blitzing the public with stories highlighting the current problems of foreclosures, falling home prices, failing lenders, and hedge fund bailouts and/or collapses. Adding credibility to current affairs are reports from leading industry executives that extend expected recovery well into 2009.

The economic pain associated with these issues is real and significant. Just ask anyone that is trying to sell or refinance a house these days. Perhaps ask the tens of thousands of employees directly or indirectly tied to the housing market that have lost their jobs.

Nonetheless, the real estate and housing market needed to change and notable warnings were shouted from respectable voices like then Fed Chairman Alan Greenspan regarding housing market "frothiness" and unsupportable valuations of assets dating back to 2002.

Those warnings were lost in the wilderness of market greed ranging from Wall Street portfolio and hedge fund managers searching for yield, mortgage lenders unscrupulously leading borrowers way over their heads, and borrowers themselves looking selfishly to make a quick buck by "flipping" their recent purchases or by taping out their real estate equity like an overdrawn ATM.

We are trying to make some sense of this mess. A big key in this process is wading through the irrational fear and recognizing a return to normalcy. Real estate appreciation rates in the double-digit ranges cannot and could not be sustained forever. Bidding wars from multiple buyers on attractive properties even remotely affordable is not realistic in the long term. A sense of balance between buyer and seller is needed for a consistent market.

Clearly, the pendulum has swung more in favor of buyers at this time. Sellers must give back some of their gains even if the market is looking at the first year to year drop in housing prices since the Great Depression. Not all is lost in this scenario. Sellers have done quite well if they have purchased longer than 18 months ago. Furthermore, economic fundamentals nationally as well as global expansion have supported commercial earnings and GDP. Employment has also maintained strength throughout this period, and as long as this continues, buyers will return in higher numbers as affordability continues to rise.

The elimination of the prolific environment of greed in past few years has taken a heavy toll on the credit and real estate markets. As long as cool heads can prevail and calm the storm of uncertainty for all parties, the economic sun will shine again for institutions and individuals alike. In addition, qualified buyers along with educated sellers, working with knowledgeable real estate professionals will promote the steady, long term values real estate has historically meant to our economy.

About the author: David B. Summers is a mortgage banker with 18 years of extensive experience working as a senior underwriter, secondary markets analyst, and account executive.

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