It's a very manipulated and manipulable metric.
It's not. The salient part is that the current market is crazy and there is a large number of bids on any given house.
>It's clear that in a lot of cases the list prices are intentionally below market to attract more bidders and produce the appearance of more competition at open houses and the like.
Yes, list prices are intentionally below market but you know what ... houses are going for crazy amounts because we are in some sort of a bubble. This isn't the fault of blind bidding, or unscrupulous realtors or greed property owners. There are systemic economic issues at play. In my area, for example, there are houses that doubled in value in under 24 months. When I bought my property 12 years ago, there was blind bidding, and bad realtors, but on any given property there were only 2-3 bids, so there was no issue.
Why? The last 40 years interest rates have continued to decline and inflationary pressures have hurt the value of every currency. What reason is there to believe this won't continue indefinitely (low interest + ~2% y/y inflation) and that the market is simply pricing things well?
Clearly all these homes are being bought so it would appear people have the money.
Yes ... Back in 2007, people bought homes as well - so everything was OK - rite?
By the way, people aren't paying cash for houses.
Homes are priced based on what people who want to live in a place are willing to pay per month. The interest rate, property tax rate, and home price determine that. As rates go down prices go up.
That was a response to your statement that 'people have the money'. The larger point is that just because people are buying houses doesn't mean that things are healthy, case in point: 2007/2008 housing crash, which was preceded by a housing bubble and led to a lot of misery.
Corporations and pensions might have the proper money