Prices are going up because the banks are still holding the vast majority of foreclosed properties off the market -- and because real estate vultures are sweeping in to buy up what little is available. These previously owner-occupied homes will now be rented out, leaving former homeowners to the mercy of the real estate speculators -- many of them foreign.

The picture isn't as rosy as they make it sound. In fact, it's pretty dismal.

The market as it exists is phony. There are millions of distressed properties waiting to be dumped on the market.

How does that benefit them?

I follow the Phx real estate market pretty closely and the numbers of short sales/forclosures have gone way down, which is why the sale averages are going up so fast.

It's supply and demand. If they dumped 10,000 foreclosures on the market, the bottom would fall out.

If banks acknowledged lower valuations on their assets, they would have to report negative earnings, executives would lose their phoney bonuses, and bank share values would plummet as they would be forced by regulators to recapitalize by selling shares at depressed prices.

"Prices in California bounded up 4.4%. Without distressed sales – including foreclosures and short sales – national prices were up 4.3% compared with last July."

(disclaimer) I'm not well versed in housing market trends, I'm a life-long renter. But I know for many, a home is a primary asset. Passed this along in that context.

according to the county assessor at least. meanwhile, my property taxes and insurance went up along with my monthly payment of course. Unfortunately, my income didn't go up along with my house payment.

If your county assessor is lowering the tax assessment then your property tax should be lower not higher.

edit - did the county raise the property tax rates? That really sucks if they did.