It appears that the real estate market is in a state of (artificial) equilibrium. Instead of prices being artificially inflated by good economic times or having bottomed out due to economic hardship, buyers and sellers are splitting the difference and meeting half way. No one is paying the absurdly high "original selling price" of property, but no one is getting a particularly good deal, either. Generally, equilibrium is the best that can happen to any particular market and ensures fair prices and decent competition.
Of course, model breaks down when corporations enter the scene. Corporations have the ability to break the normal rules that make capitalism an efficient system. They can undercut competition by purchasing merchandise in bulk from vendors at greatly reduced prices. They can sell loss leaders below cost to get people into their stores because they know the markup on other items will more than make up for it. They can break major labor and antitrust laws while hiding behind an army of lawyers. Most importantly, they can hold onto assets that cost them millions of dollars while being cushioned by the vast volume of their stronghold in the market. Corporations only care about making quick money for their CEOs stockholders. This is clear from the way hourly employees get treated and some of the ridiculous money making policies and procedures these corporations have.
In the case of real estate banks act as corporations, holding onto properties until the market improves to their liking and then holding out for the best possible price. This is why short sales take so long and why HUD sales have a set bidding period. This is also why the market has reached equilibrium before the economy has. Most of the homes for sale right now are bank owned. Many banks don't even pay taxes on the properties they own and can hold onto them until they feel the market is working in their favor. The bank doesn't care about buyers, tenants, or the health of the market; the bank only cares about making quick money for their CEOs and stockholders. This is clear from the fact that the housing market crashed to begin with.
Because banks can't really buy (or foreclose upon) houses in bulk in the same way that a corporation buys from it's vendors, they need to make more money per unit to keep their profit margin up. This is where the hosing and retail markets differ. While corporations ultimately drive prices down with their practices, banks seem to be driving prices up with theirs. That's why it is so difficult for a non-prospector to buy property right now. Even though Jason and I have enough money saved up to put a decent down payment on a place, we will never quite catch up to what the banks expect, or be able to compete with investors, sitting on a pile of cash.
Despite my Photoshop class progressing incredibly slowly due to some of the students not being terribly familiar with Apple computers (or computers in general), I did pick up a few new tricks today. I decided that it would probably be a good idea to update the game's buttons before I embed them into the file. Each button has three different states, which you can see by rolling the mouse over and clicking on them. Yeah, I've been picking up some things in my HTML class as well.
