There's no huge drop in housing prices, but a glut of sellers and fewer buyers means deals can be found

Like many potential home buyers, Chip Chaunamom has been watching and waiting.

The 30-year-old Web designer has been looking for his first home in the Lowell area for more than a year. His first plan was to buy a townhouse but, as the real estate market has cooled, he now is looking for a better deal in a single-family home.

"There's a lot more on the market and prices have dropped a lot," Chaunamom said. "I think I'm in a good position."

A buyer's market is firmly in place in Massachusetts. The causes include: higher mortgage rates, which makes owning more expensive for buyers and reduces their buying power , thus curbing housing demand ; only so-so economic growth, which also limits demand for new housing; and a glut of supply, so those buyers who are in the market don't feel the need to rush to get the last available property.

Buyers have "some great choices," said Liz Kincannon , a sales associate with Coldwell Banker Residential Brokerage in Wayland.

Indeed, about 38,700 single-family homes are on the market -- 8 percent more than a year ago. And those houses are available an average of four months -- 121 days in the first quarter of 2006, compared to 106 days in the previous year's first quarter .

Yet for all this tilt to the buyer, the market so far lacks one major element that would make buying a house a no-brainer for many: a big drop in prices.

By several measures, sale prices for single-family homes are declining, but not by much. The Massachusetts Association of Realtors reported that median sales prices dropped 1.2 percent in May, while the Warren Group, which also tracks the industry, said median prices for single-family homes were down 4 percent. (Warren, which tracks a large set of sales, reported median prices were $331,000 for May, while the realtors group reported median sales of $352, .)

Condominiums, meanwhile, continued to appreciate through late spring, the median prices increasing 1.8 in the Warren Group survey, and 2.5 percent, according to the realtors association.

So what's going on? David Wluka, president of the Massachusetts Association of Realtors, said the market -- and home sellers -- are in the midst of a reckoning. Whereas sellers could once reliably count on annual appreciation levels in the double digits, houses are now appreciating at only a much slower rate -- 3 to 5 percent, agents say.

That reality still hasn't sunk in with sellers, Wluka said, and prices won't drop further until many more would-be sellers realize they can't command the elevated prices they once could.

"The sellers are going through denial, basically," he said.

Indeed, Massachusetts' embedded high real estate prices continue to be an insurmountable hurdle for some home buyers.

When James Tessman and his wife, Melissa, began looking for their first home earlier this year, they had hoped to find a small house with a yard in Billerica. They quickly realized the area was out of their price range, and ended up buying a condo in Hudson, N.H., about two months ago.

"You cross the border and everything dropped by $20,000 automatically," Tessman said.

The couple was disappointed with their first experience in real estate, and still hopes to trade up to a single-family home. But even as sales have slowed, they are doubtful that the market will shift much in their favor.

"I'm not even so sure the market is going to change that much over the next few years," he said.

Gary Rogers , an agent with RE/MAX First Realty in Waltham, said he believes the market is crowded with homeowners who are not really serious about selling, which is keeping prices high.

Homeowners who are under a schedule, according to Rogers, will price their homes more accurately.

"If they have to move, they have to drop the price," he said.

Alysia Butler and her young family were on a deadline to sell their four-bedroom home in Pepperell. A home that they had their eye on in Hopedale -- closer to her husband's job -- became available and they had to act fast.

They put their house on the market for $295,000 in May, and within a month it was under agreement near their asking price. A year ago, they probably could have asked for more, Butler said. But she also had seen similar homes in their neighborhood that were priced higher -- and had sat on the market for months.

"We just didn't have that kind of time," Butler said.

Dorothy Murphy and her husband, who are expecting their second child, also wanted to sell their home in Quincy as soon as possible. They put their three-bedroom starter home on the market at the end of March for about $310,000. By May, it was under agreement for $280,000.

Murphy said they could see the market shift even during the period their home was for sale, with many properties staying on the market longer. They felt lucky they were able to sell when they did.

"By the time we got the offer, we were thinking, `Boy, we better take this,' " she said.

Some houses in different price ranges are drawing bidding wars, as if it were still the market of old.

Ron Morrison , president and owner of Morrison Real Estate in Westford, said a home in Lowell priced in the $250,000 range recently received six offers, while a home in Acton in the $650,000 range receive two offers.

Still, the market can run hot and cold even within the same community. In Waltham, for example, Rogers recently put a four-bedroom home on Cliff Road under agreement after it was on the market just four days. But Michael Hughes, another RE/MAX realtor, has been trying for almost three months to sell a three-bedroom home on Milner Street. He said the home could have fetched $425,000 last winter.

"Now at $414,000, it's sitting on the market, which is kind of a surprise," he said.

Meanwhile some home sellers who've yet to sell are maintaining a sense of optimism.

As she nears retirement, Marsha Halloran is looking to move to Florida. About six months ago, she put her one-bedroom Weymouth condo, where she has lived for 14 years, on the market for $259,900. Still, after a number of favorable open houses, she is confident the unit -- one of 16 in a converted school -- will eventually sell.

"This would have been scooped up right away if it was a couple years ago," said Halloran, a mental health specialist. "I think the prospective buyers are taking their time."

Emily Shartin can be reached at .