When home buyers ask for a deal,  I explain that the majority of homes are selling for market value.  But what happens is that some sellers are expecting to get last year’s value when selling their home, so when a sensible home seller prices at today’s market value, it can appear to be a deal (because of all of the overpriced listings), but in reality it is market value.  Banks are selling their foreclosures for market value, they get appraisals, and they hire a Realtor.  They don’t need to sell their inventory for less than market value because we have home buyers ready, willing and able to buy.  The banks generally price their inventory aggressively and this can still result in multiple offers, with the competition often bidding the home’s price to sell for over asking. 

Buying at today's market value is a good deal.  But you have to find the home that is selling for market value and beat all the other buyers out of it (and hopefully avoid a bidding war).  I think if a buyer is seeking a deal they should look for a cosmetic fixer or a home that is unique, in a good way.  A home designed by a name architect is unique; according to the MLS La Canada’s Lautner was sold in 2004 for $2,000,000 then again in 2007 for $2,000,000.  Known as the Gantvoort home, it has been reduced to $1,595,000, which appears to be a major bargain for this 1800 sq ft architectural gem on an 11,000 sq foot lot with pool.