Since Americans don’t save, they rely on unsustainable home prices instead to make them feel wealthy. This can also be attributed to the media, TV shows like flip that house, and wealth icons such as Donald Trump. American sheeple have been tricked into overpaying (more accurately over borrowing)for their real estate for years, and despite the sensible logic posted by KamFongasChinHo, and even in times of correction like these, there is still that trend out there that equates owning real estate as the fastest way to riches.
It isn’t just high home prices that America is obsessed with, it is the constant and excessively high rate of home price appreciation that Americans have snobishly come to expect. This will allow the indebted homeowner to borrow even more money, and spend it excessively. You are right though, with such huge amounts of inventory around the country, prices should drop substantially, allowing the future homeowners to hopefully be able to pay for their skyrocketing cost of living.
