Thank you for this post. I hadn't thought about residential real estate in quite those terms. An associated must read is the link to 10 cities which could drop precipitously FURTHER due to CENTRALLY PLANNED (Obama) withheld foreclosure inventory. The idea that markets get fixed by saving pigmen and obstructing selling or other distortions is a real problem now and in making decisions for the years ahead.
http://www.businessinsider.com/shadow-inventory-miami-las-vegas-2011-4#10-maricopa-ariz-phoenix-1
I have come to realize that men are not born to be free. Liberty is a need felt by a small class of people whom nature has endowed with nobler minds than the mass of men. -Napoleon