I came across this map of the United States which shows the median home prices by geographic market.

Click here to see real estate price map. 

You can move your mouse across most major cities. By clicking on the little house, you can see the median home price as well as the increase or decrease in the home price.

While we are not boastful about the performance of the residential real estate market in Chicago, the good news is that we are not Florida. View the map to see what I mean.

As members of Congress opine on the implementation of the $700 financial bailout plan, those of us on the front lines of residential real estate pontificate on the perceived benefits at the grass root level.

Relative to residential real estate in the greater Chicago area, most markets are oversupplied. In many towns, at the current rate of sales activity (referred to as absorption rates in real estate circles), it would take 9-12 months to sell off the existing inventory of homes provided that no new listings were to come on market. Currently, marketing times are averaging 8 months.

The needs to sell and buy real estate remain constant. People still relocate as a result of job transfers. Young families still want to move into larger homes. Upwardly mobile families still desire to move into more expensive homes. Emptynesters still want to downsize.

Unlike other forms of financial decisions, the decision to buy and sell a home is an emotional decision which is justified by logic. Even those who think that they are making a a detached, scientific decision are actually making an emotional one and justifying it via some detached and/or scientific method.

In the English language, the word "home" has some of the highest emotional connotation. It’s second only to "mom".

My point is that people need to feel good about making a financial decision as large as buying a home. There needs to be a certain level of confidence. Events such as those surrounding the financial markets erode this confidence.

The $700B bailout, as I know it today, is likely to produce the following positive economic and psychological effects on the residential real estate market:

• Lower mortgage interest rates.
• Greater liquidity in the secondary mortgage market. This will lead to lenders actually being encouraged to make loans and even being able to close transactions.
• Resurgence of lender activity. Lenders will re-activate their proactive (yet more responsible) lending practices

A second impetus to the residential real estate market will occur after the presidential election. Even in "up" real estate years, there tends to be a fence-sitting mentality as buyers have an uncertainty instilled in them. This impact is accentuated in down real estate years. Regardless of who becomes president, the uncertainty goes away. And this is a good thing for the residential real estate markets.

As reported today, the National Association of Realtors reported an increase in existing home sale of a 3.1%. It is asserted that this increase was fueled by sales of foreclosed homes.