Aunty,
I think I mentioned a while back that Mason County assessments were a joke. You should protest it and see what they used to come up with their values.

DaveD,
Do you have any equity. If you do or are close, you should see if you can find what you are looking for. Usually within the same market the higher priced properties have fallen more then the lower priced ones. This isn't true everywhere, but if it applies to your area you should be buying now. What this means for you is that even if you lose money from what you paid you can still come out ahead. Imagine if prices stayed the same. Ex. Your house is worth $200,000 and the one you want is $300,000. Now the market has fallen and your's is worth $140,000 and the desired one is $220,000. Yours fell $60,000 but the new one fell $80,000. By buying now you actually come up $20,000 over the old prices plus have lower loan and closing costs. Even if you need to finance part of your loss, you still should come out even or better than you would have in the old market. If you are moving down, of course, the exact opposite could be true.

In the past, many people I met used to tell me how they couldn't sell and rebuy because the new homes were so expensive. Of course they would fail to take in consideration how much their existing home had gone up in value. In the end, as long as you are moving within the same market its all relative.