What is going on with Lack of Inventory and Housing Prices in the Current Market?

[Greg P.]

Hello, I've noticed many people talking about the lack of inventory on their MLS including myself on these forums. Could someone with experience please explain if the market is going up? I've noticed that the housing prices are going up somewhat dramatically and there are less "deals" on the market. Many have suggested that doing direct mail may help, but still wondering if the MLS days are really over?

[James H.]

I doubt the rate of foreclosures coming on the market will speed, regardless of the banks getting through legal turmoil. Think about it, with the bail out money, the banks got all the money back that they would have lost to defaulted mortgages. Since they were basically relieved of liability of the defaulted mortgages (a gift from tax payers) there is really no incentive to drive prices down by releasing large volumes. I'm sure I see this in over simplistic terms, but that's what I think. When you control the inventory, you control the prices. And the banks have no incentive to move these properties.