CNN has an article about The National Association of Realtors saying that home sales dropped 8.6% in November. That’s a pretty steep drop for just one month. What I take from that is that this may be one of the best times to buy a home. Buyers have not only this information to negotiate with, but also the benefit of the winter off-season. Mortgage rates are low too – though you might have to have pristine credit to qualify for them.

This news of the home sales drop falls on the heels of Fortune announcing the 10 Worst Real-Estate Markets for 2009. Every year is going to have a 10 Worst Real-Estate Market (even if things are doing well), but some of the predicted drops are huge. Nine of them are projected to lose 20% or more and the 10th, Washington D.C. escapes by the slimmest of margins with a 19.9% projected drop.

It may surprise many that the Fortune list had 8 of the 10 worst markets in California. I always knew that California was expensive, but I didn’t expect it to dominate the list as much as it did. I figured that New York City may be in there as financial, premium fashion, and advertising businesses look to have a tough time next year (in my opinion – I have no objective proof of this).

This made me think, how is my rented-out condo in the Boston suburbs doing? I paid $278,000 for it in the summer of 2004. Zillow, which is very accurate for the property, lists it as currently worth $226,000. Ouch. Pain. Since October it’s dropped more than 13%. I’m actually close to being upside down on the mortgage that peaked at around $300,000 in the fall of 2005. For this reason, I can’t take advantage of cheap refinance rates unless I want to put another huge chunk of money into it to avoid private mortgage insurance (PMI). Sad.

If prices turn around instantly (fat chance) and resume a 5% gain that real estate has made in the past (over the long term), it will take me more than 4 more years for the value to catch up to what I paid for it. At that point, it will have been 9 years of home ownership for no gain. Let that be a reminder to all those who say “renting is throwing money away.”