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- Demand is back to early 1990 levels;
- Prices are bouncing off record highs.
Can both be true at the same time?
In the past, sharp demand increases and declines led prices.
This time around – even after 7-years and TRILLIONS in .gov debt, ZIRP; QE; mods; and continual easing of FHA, Fannie & Freddie guidelines – demand is only back to early 1990 levels. But, house prices have gone up more, over a shorter period than any time before, and are bouncing off record highs.
Bottom line: Suddenly, demand and house prices aren’t too correlated any longer? Have house prices somewhat “de-coupled” with demand? That’s a profound housing economy development, if true.
(In fairness, Oct 2014 remains the peak for this series and been highly volatile ever since.)