U.S. home prices are currently 30% off their 2006 peak, and many economists expect them to fall even more. During the housing boom, when prices rose steadily, low appraisals were rarely an issue, but the market meltdown revealed how inflated appraisals contributed to the housing bubble. The result: both appraisal and lending standards are now tighter.

According to a January survey by the National Association of Realtors, 10% of the nation's Realtors said that they had sales canceled because appraisals came in below the prices buyers agreed to pay; 15% said that contracts were renegotiated after appraisals came in too low.

Lenders and appraisers say that falling home prices, not flawed valuation practices, drive low appraisals ... (USA Today)