CA renter, when I hear bubble, I interpret that we’re in an unnatural situation and bubble would have to pop. So, when you say, in 1997 was the start of the bubble, I associate that to mean, in 1997, price was already out above its natural range and become overpriced.
You seem to forget one very important factor, interest rate. People don’t pay for their house in cash, so absolute price is only one part of the total equation. I consider a house to be under priced when it’s cheaper to buy than rent. In mid 90s, it was definitely cheaper to buy than rent. You seem to forget inflation as well. I guess what I’m trying to say is, the market is being controlled by TPTB, and it has been that way for a very very long time. I don’t think we’ll ever see a completely free market. BTW, I think you forgot, FHA, GSE, and Fiat currency in your list of manipulators as well.
