Reply #51: Correction needed.

[kenfrequed]

Yes this is a needed correction, however this price drop will cause quite a lot of headaches. People might see what their property is actually worth and look at their steep mortgages and choose to let the properties fold back to the bank. It might result in a feedback loop. Of course construction will take an even bigger hit on this as will dozens of related industries. Many new exurban developments and condos will go empty and those companies that invested in them will collapse.

Of course this is also going to wash through the entire market. But I am not an economist so what do I know.