Reply #7: Both

[SoCalDem]

wages too low AND prices still too high.

and the conundrum many face now is this:

competition from "investors" with cash, who swoop in to buy up the best bargains (they have ALWAYS done this)

and banks are unwilling to lend to most people now (unless they have 20-30% down)

Many would-be first-time buyers cannot find a home, even in a depressed market, because they lack the upfront money necessary (it's been this way forever, until the EZ-Credit years), and because banks are back to being careful with lending.

Super low prices create a bidding-war scenario for the "best" properties, which does not benefit the people vacating the home, so banks are more willing to sit on repos, in hopes that investors will end up paying more for these sought-after places, but in the process, many people who would actually make good home-buyers get priced out of their capability in a New York Minute.