PORTLAND, Ore. (AP) -- Until now, Portland has pretty much ridden out the national slide in home values, and still is ranked among the more stable markets.

But that is slowly changing, and economists say falling prices, while modest compared to some cities, probably will continue well into next year.

As recently as February, Portland, Seattle and Charlotte, N.C., were listed as the top three markets in the country.

Real estate agents liked to say Oregon didn't overbuild and people kept moving to the state, sustaining demand.

But by June Portland and Seattle were ranked fifth and sixth. Charlotte remained on top.

While housing prices in some regions peaked in 2005, they were still growing in Portland two years later. But they fell 5.8 percent for the year ending in June, the biggest slide since the 1980s.

Homebuilders are stuck with millions of dollars of housing they can't sell. About 18,900 real estate related jobs that existed in August 2007 are gone, as are 11,300 in the construction industry.

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State economists expect the housing market to improve in late 2009. Ed Kashmarek, a Wells Fargo economist who studies the Portland region, isn't so sure.

He expects people to keep coming but says prices are still too high compared to average incomes, and a wave of foreclosures is coming.

In the Portland area, median household incomes rose 10 percent between 2000 and 2006. But the median home value rose 72 percent, putting mortgages out of reach of more people.

Oregon's rising foreclosures will boost the supply of for-sale homes when the market already has more than it can handle, so sellers will have to trim prices.

Kashmarek expects home prices to fall 6.4 percent in 2008 and another 11.9 percent in 2009.

The firm Global Insight says half of the nation's top 20 overvalued housing markets are in Oregon or Washington. After Atlantic City, Bend is second, Portland seventh.

Oregon has weathered worse.

In the 1980s, mortgage delinquencies hit 6.2 percent and foreclosures 2.2 percent, about twice the rates of the second quarter of 2008.

Oregon's construction industry has shed 10 percent of its jobs since last August, but Art Ayre, state labor economist, says that pales compared to the early 1980s when construction jobs plummeted by 49 percent between 1979 and 1983.

"It's fair to say it was worse in the early 1980s," Ayre said, "but we'll see where it goes."