What does $1 Million Buy you in Today's Real Estate Market?

In many parts of the country, it can certainly go a long way. In other areas, however, even with the unprecedented drop in home prices over the the past three years, a seven-figure price tag doesn't necessarily get you an ultra-luxurious apartment or big house in the suburbs.

The most recent S&P/Case-Shiller Home Price Index shows that home prices today are comparable to levels seen in 2003, down approximately 33.5% from the all-time highs of 2006 prior to the recession.

The precipitous drop in US home values has taken a toll in personal wealth and well being. The number of homeowners underwater–meaning their home loan is worth more than the market value of the house–is now 23 percent of the 55 million outstanding mortgages, according to real estate information service Zillow.com. (Some estimates put it lower.)

With the fundamental stock market strategy of "buy low, sell high" in mind, many real estate buyers these days–whether ordinary consumers or investors–are getting into the game because of bargain prices. Affordability is the best in many years. Low interest rates and an $8,000 government tax credit for first time buyers have brought life back to quiet and depressed markets. Realtors in nearly every local market are increasingly optimistic abut the future.