The bottom line is that someone has to pay to live in those houses. Our dollars are being rapidly devalued, that’s true, but unless we’re invaded by hordes of Germans and Swedes to purchase all of these $750K homes, the incomes required to make those payments are going to have to come from Americans. And American wages have been stagnant since 2001 or so. House prices went up because of easy lending and speculation, end of story. Home prices may stay high in nominal dollars due to inflation once wages catch up, but they will decline in real dollars. The real question is — do you think wages are going to catch up or not? And if so, how long do you think it will take?
