[Steve Tinker]

You are opening up a big can of worms with your question...

In the UK, you can pick up an early Boxster for less than 5,000 UK pounds ($US7,000) while here in Australia the cheapest (private) listing is a 1997 180,000 km Boxster @ $US19,000 + tax and the least expensive 996 Carrera is $US38,000 + tax.
So who's the lucky ones - certainly not us here in Oz.

I think the poor current world economy, the hundreds of thousands of Boxsters and 996 Carreras manufactured and (more significantly) the perceived unreliabilityof the M96/97 engines has to add to their fall from grace.
I'm not totally convinced though that the poor reliability is completely warranted, but when Porsche traded their reputation of (expensive) high build quality for cheaper mass production fiscal survival , they attracted a totally different buyer to the Porsche brand. The new purchasers wanted to buy into the badge and performance & expected Japanese reliability too - all without being saddled with the attached high Porsche running costs.
And as the used cars got cheaper, so did the second hand buyer. We have seen hundreds of threads from new owners bemoaning the fact that water pumps, rads, oil, servicing, etc, etc, costs so much for their sub $10,000 Porsche bargain.
As with many things, the initial cost of a Porsche is relatively easy to absorb, but the running costs are another issue altogether....
Add all these negatives together and you soon realise why the 986 / 996 cars are cheaper than their ealier counterparts - even though if you get a good one, they are a far better drive than their older relatives.

Just be thankfull that they are so cheap - the bargain of the century for many of us !!!