Prices at the peak (in areas that were developed in 1996 so we can compare prices now to prices then) were about 4-5 times higher than back in 1996. So a drop of 25% from the peak – a global residential real estate peak that was unprecedented in recorded history – is peanuts.
If the price decreases at the high end continue on their normal, natural course to a cyclical low, then the federal govt will come up with a new way to funnel more money into the high end. I don’t expect prices to be allowed to get anywhere close to their natural economic level at the bottom of a RE cycle, either at the low end of the market or at the high end.
