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The truth is that home prices cannot rise faster than inflation unless we are inflating a bubble. The only thing surprising is that reasonable people who understand this are being heard right now. Usually, the bullshit from the NAr and the general level of kool aid intoxication in the media makes more noise.

The general public is waking up to the reality that the artificial bottom the government produced is not curing the housing market’s ills. It’s time to let house prices fall.

The moral stigma regarding “Walking Away” is now pretty much gone. That it ever existed in the first place is quite hypocritical.

Never have so few, done so little, and made so much, while screwing so many.

I posted in my Orlando real estate blog earlier this month about an article regarding house sizes. It was prompted by an article I read on Yahoo quoting a survey conducted by Trulia. The folks at Trulia liked that I liked it on my Facebook page. One of the questions that I had about the numbers [...]

That one final, cathartic wave would be awfully painful. But, we would get through it. And, once we’ve hit bottom, there’s no where to go but up!

The second reason is that, Mr. Yun notwithstanding, most people simply do not believe that housing prices are even close to hitting bottom. “In the Bay Area, a house that was worth $300,000 a decade ago became a million-dollar home,” said Greg Fielding, a real estate broker and blogger. “Now it is listed at $800,000.” That price, he suggested, was still unrealistically high.

Maybe that’s how all of this will end. Maybe, eventually, enough of us will get mad enough and tired enough and simply demand that the charade ends so that we can get on with out lives. Eventually protests could turn to riots as social acrimony spreads and perhaps at some point our politicians may get it:

In other words, the Government will continue to prop up home prices as long as they have to. Proving, yet again, that the consensus continues to confuse the cure and the disease.

To suggest that real estate as an asset class is gone forever is to grossly misunderstand not only housing, but the nature of human progress itself.

Consumer demand is dead. That demand is not coming back anytime soon, and there is no driver for jobs if it doesn’t. Unemployment and GDP will both be extremely weak for the duration.

This number is the lowest that the NAR has ever reported, and I can see why it spooked the markets, sending 10-year Treasuries breaking through the 2.5% level: we’re seeing less housing market activity now than we were even during the depths of the crisis. According to the NAR, there were 4.94 million existing homes sold in 2007, 4.34 million sold in 2008, and 4.57 million sold in 2009. The latest annualized number in that series, for July 2010, is just 3.37 million. That’s a 26% fall from last year’s rate.
The number is so low that it looks like a statistical aberration: let’s hope it is. Because if it isn’t, the news is gruesome.

The shadow inventory is now estimated to be around 7 million homes. But nobody can really say because, if home prices begin to spiral downwards again, the number cold balloon much higher. Home prices, and possibly our entire economy, will not hit bottom until we undo all of the real estate transactions that never should have happened.

So, after 5 years, how much progress have we made?

My best guess, to use a baseball analogy, is that we’re in the third inning. At this rate, it could be decades before this housing mess is behind us.The shadow inventory is now estimated to be around 7 million homes. But nobody can really say because, if home prices begin to spiral downwards again, the number cold balloon much higher. Home prices, and possibly our entire economy, will not hit bottom until we undo all of the real estate transactions that never should have happened.

So, after 5 years, how much progress have we made?

My best guess, to use a baseball analogy, is that we’re in the third inning. At this rate, it could be decades before this housing mess is behind us.

About 51 percent of Shanghai apartments, 66 percent of Beijing flats and more than 70 percent of units in Hainan are vacant, according to the survey, based on counting the number of apartments observed to have no lights on at night. It was conducted on more than 1,000 real-estate projects and was organized by news website Sina.com., according to the report.