What Does Econ 101 Mean for House Prices?

House prices have already fallen quite a bit since their peaks in October and November, depending on where you are. The biggest driver here is the tightening of credit in terms of the impact on house prices. Sales activity is down about 30% on a year ago when we look at REI data. And it feels like that decline sort of troughed and it will start to recover. We feel like we're at the bottom now, but there's a lag here between sales and prices.