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Those mortgages have to be paid back IN DOLLARS, but wages and job prospects are down nominally and extremely significantly in real terms(all of the new studies show that the jobs currently being produced en masse pay significantly LESS than the jobs that were lost during the recession, and those studies dealt with NOMINAL TERMS). This means mortgages are becoming MORE difficult to pay down, not less. The inflation is NOT going into wages, the job market, nor RE. It just plain is not - RE IS DOWN AN ADDITIONAL 5% -6% or so this year.
5% down from last February means DOWN 1/20th, it does NOT mean "flat."
Per the article above and the NAR, the median US house price is now in the 150sK!!!
Look up what it was a year ago.
Then look up what it was in 2009.
That is NOT FLAT - IT IS CLEARLY AND ABSOLUTELY AND 100% DOWN.
ADDITIONALLY, since people's living expenses are shooting up, and energy and food are more important than housing, these costs are driving out the ability to handle RE debt/leverage which has already begun to put even more downward pressure on RE prices/values. Skyrocketing health insurance is not helping either.
tatupu70
2011 Mar 22, 2:32am
I'm sure this article is wrong. Housing is tanking across the country. No end in sight...
A couple of highlights--Pending contracts highest since last April. Inventory lowest in 5 years.
http://news.yahoo.com/s/nm/20110321/ts_nm/us_usa_economy_housing#mwpphu-container
Back at April 2002 (just hanging on) levels - 9 YEAR LOWS!
Existing home sales COMPLETELY AND ABSOLUTELY TANK. The results are far worse than any of the 53 analysts openly previously opined (hint, they're all morons).
NAR admits RE nationwide average loss of 5-6% in fiat for last twelve months. Stop lying - the RE bears were right.
When valued in wheat, corn, oil, ounces of silver or gold, RE is absolutely and totally collapsing. Even when you trash the unit of measurement, the USD in this case, RE is still as impotent as an overweight American - that's not just sad, it's laughably pathetic!
#housing