Generalizations about changes in housing values aren't of much practical use IMHO. Not only are home values specific to a community (commuting area), but they depend on the character of the home on the market. For example, the condo market can be quite different than single family dwellings. Within the condo market there may have been too many one bedrooms (often studios with a sleeping alcove) constructed.
One thing is for sure, those who weren't conservative in their home financing will get creamed because of the mortgage mess. It will be really tough to transfer jobs out of the commuting area if you need to sell your home. No one is immune from this if you need to buy or sell a home. The winners will be those who are renting, have saved a lot, and who intend to stay in the home for many years.