Housing crash in the USA.

Preamble: this is about housing markets and economics. Skip it if that
bores you.

Historically in the few years following a stock market crash the housing
market booms and busts. (This might be a North American trend.)
Disclaimer: off the top of my head I don't recall where I heard this.

Stocks prices in North America took a dive in the early 2000s. There were
big things with Nortel, Enron, World Com for example.

There was also the "dot com" crash when people finally had to admit stocks
were over-valued and there is no "new economy". Okay, you don't have to
admit those things to yourself but a number of people lost a lot of money.

1) That's the first thing that kind of supports rising prices being a
bubble.

A while ago I read about "the housing bubble" at
http://www.stock-market-crash.net/housing-bubble.htm

It is a very interesting argument. The problem is with too much debt
being built up in the economy. It reads:

In recent years, despite the recession, housing prices have risen by
over 43 percent. ... Mortgage rates are at a 40-year low. ... A
major sign that we are in a housing bubble is the fact that fewer people
can afford homes. ... A housing bubble needs a steady stream of
thirsty home buyers.

Just that last bit starts to sound like a "Ponzi scheme".

2) That article argues there is a bubble with housing prices.

Just now I came across an Associated Press article from a few hours ago
that reads:

Is this what a housing bust looks like? New home prices fell last month
by the largest amount in 35 years and owners are being warned to brace
for further declines, especially in formerly hot markets.

...

The sharp slowdown in housing follows an extended boom in which the
lowest mortgage rates in four decades powered sales of both new and
existing homes to records for five consecutive years

Read todays article over at
http://biz.yahoo.com/ap/061026/economy.html?.v=10