HOUSTON -- Houston missed out on the housing boom, so will the city miss the housing bust? 

Tim Surratt is a realtor who’s been selling homes in Houston to buyers around the country.

"The market in Houston is doing well in certain pockets," said Surratt.

But for the first time in years, the bad pockets are outnumbering the good ones.

The Houston Association of Realtors said that the average home that was worth $197,000 in October 2007, sold for $194,000 in October 2008. That's a drop of over $3,000 or 1.6 percent.

The market drop is worse in some of the suburbs, where new homes outnumber buyers. But the chief economist for the National Association of Realtors said that in general, the 'good' in Houston’s home market outweighs the 'bad.'

"Houston is in a position to see a stronger price growth heading into 2009," said Lawrence Yun, National Association of Realtors.

Nationwide, home values have dropped 9 percent since last year. But some cities are feeling the crunch more than others. For example: Anaheim is down 28 percent, Atlanta is down 14 percent, Dallas is down 2 percent, Denver is down 11 percent and Las Vegas is down 28 percent. 

While some cities are struggling, Houston is up 3 percent. In fact, even if falling oil prices cool Houston's job market, Yun doubts it will be enough to drag home values down.

"It's possible that perception leads to reality, but I think most people understand that Houston is an underpriced market. Given the local job creation, I think the situation will be fine in Houston in 2009," said Yun.

But since real estate is all about perception, it's hard to predict what's around the corner.