I have to agree with pretty much everything that B-Line and Quicksilver have said.

The appraisers and agents do not set prices. The historical sales in the neighborhood (the market) set prices. People can list a property for anything they want, but that doesn't mean it will sell for that price or that it is worth it. Also, the appraiser is not there to protect the buyer. They are hired by the bank to protect the banks investment in the property. They are basically sent to be sure that the bank is not lending more than the property is worth on that particular day. They are not there on the buyer or sellers behalf or to guarantee that the property will always be worth at least as much as it was on the day of inspection. Things change, for better and worse.

It is simply a buyer beware world we live in. A person who is buying a home and knows nothing about real estate or the market can contract an agent for FREE. That agent gets paid by the seller, so the potential buyer owes nothing. If you have no clue about the most important/expensive purchase of your life and you don't get the free help of a buyer's agent, then I really don't feel bad for you.

As far as the bank being responsible for any more of the loan then they already are is crazy. I appraised a property a few months back that was bought before this whole slump started. It was in a new construction subdivision. About a year after the homeowners purchased, the market turned to garbage and there were many homes in the development that the builder was sitting on. The builder eventually dropped prices significantly to move inventory and even offered $20k in builder incentive that could be used for price reductions. When I looked at what they paid for the house a year ago it was a legitimate price, now the home was worth about $30k less in one year because of all the recent comparables in the neighborhood. Would you say the bank should eat the loss on that too?

Home values are not guaranteed to increase. I think that is the main thing that people forgot because of how crazy homes were appreciating before this downturn. If you are buying a home for any reason, you have to be aware of the possibility that your homes value can decrease. If you are not comfortable with that possibility, then renting may be the way to go.