Developer Garret Bangerter of Bangerter Homes said the current southern Utah market is flooded with undeveloped lots and new home inventory, which is also helping to drive down prices in the area.

Much of that decrease is due to the reduction in land prices, Bangerter added.

"When everything went crazy a couple of years ago, everybody got into a frenzy and thought they were going to get rich developing lots," he said. "Everybody jumped in and bought land, and now the Metrostudy group is telling us there is going to be an eight-year supply of lots available."

Bangerter said just three years ago, lots to build homes on were scarce, and the demand was extremely high. Now that situation has reversed itself. He attributed the change to the aggressiveness of seasoned developers and speculators trying to make big money in the hot real estate market.

"Everybody thought there would be no end to the demand, and now we have an oversupply," Bangerter said. "Prices have definitely been coming down as developers realize there is an oversupply."

Slow recovery

Even with the decrease in prices, the area's tighter loan restrictions make it difficult for many consumers to purchase a home, Knowlton said.

"I have a lot of customers who used to have excellent credit, and that's gone now," she says. "They either bought too much house and can't make the payments, or they can't get a loan refinanced. Their credit is ruined. People don't know what to do."

Tishanne Stout said she feels luckier, in a way, than many of the people who, like her husband, work in construction.

"My husband has had work. There are many people who didn't have any work for months at a time," she said.

But the work her husband has been able to obtain has sometimes been far from Washington County. Most recently, he worked at a job site in Beaver, staying there for several days at a time and only coming home on weekends.

"We've been lucky, though," she said. "It never fails. Every day, there are two or three people who ask my husband for work, and he says he already has his crew."

For those who can afford to buy a home in Washington County and qualify for a loan, there are bargains galore, according to Carter.

"There is honestly not a better time, in the past 10 or 15 years in Washington County, to buy a home right now," he said. "The problem is, not many consumers can do it."

Knowlton said prices are likely to go down even more during the next year or so before the market stabilizes.

"A lot of people are trying to work something out with their lenders to avoid foreclosure, but there's not a lot being done for them," she said. "It's really devastating for a lot of people. It's going to take them a long time to recover."

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E-mail: nperkins@desnews.com, jlee@desnews.com