The housing market is still sputtering along. Here is the latest:
- Case-Shiller index down 4.5%
- Availability of credit continues to drop
- High unemployment – job growth was nearly flat in June
- Psychology – people continue to “hold out” for lower prices
The video below shows the enourmous headwinds that housing prices face when they recover from a bubble. In the past, prices “overshoot” from an extreme high to an extreme low. It will take years for population growth to soak up the excess inventory.