Wachovia is offering some tough words for tough times: The first step to healing the Florida housing market is for owners to drop home prices. In its October 2007 "Housing Chartbook," Wachovia's economic forecasting team blamed speculators for blowing prices out of the water from 2004-06. "What needs to happen now is for prices of new and existing homes to adjust back to levels where families earning the median household income can once again afford to buy a wide assortment of homes, particularly in Florida, Nevada and California," the forecast said.

The average annual wage in the Tampa Bay area is about $41,000. For a home to be affordable, its price shouldn’t exceed about three times a buyer’s income. But many sellers have stubbornly clung to what in many cases are intolerably high asking prices.

That's one reason why 41,000 homes clutter the listings. Some people are eager for gains, but many simply can't afford to lower prices further. Maybe they took out 100-percent financing or borrowed against the value of their houses.