So as you can see, Interest rates are a really strong driver in the prices of houses, which is why it was so stupid for people to take on ARMs when rates were at their lowest, the only possible direction for rates to go was up, yet everybody loaded up at the worst possible time. Add to this that regulation was nil and hype was all over the place. These same factors in reverse will drive the prices down for years to come in my opinion. So from this point, 226k looks low when in reality the current prices are still too high.
