radelow
Its really quite simple. You cant compare average prices to the the average household. The average household isnt buying the average house around here. Heck they probably arent (or shouldnt be) buying anything.

We have between 50 and 60% of households in homes they own, at least figuratively. Many of these are long time owners with homes purchased a couple bubbles ago. Most of them arent going anywhere short of a pine box. The new homebuyers to the area probably dont start until the 75th percentile.

The most powerful forces at play are supply and demand. Supply of homeowners willing/able/interested in selling is relatively low to what the real demand is for homeownership. Much of that real demand exists only at lower prices. As prices creep down demand inches up.