Your Homework: Are Banks Fixing Home Prices?

I am in the process of writing a post about the Corporate Personhood debate that’s come up with a recent Supreme Court ruling. But this morning while I was out jogging, and noticing yet another empty 3/1.75 home listed at just under a million, a thought occurred to me.

According to a number of people who know more about this stuff than I do, recent regional real-estate inventory numbers are artificially suppressed because bank-owned properties, which would normally be on the market, are not being listed to prevent “excessive supply” which would consequently drive down prices even more than they are already.

In other words, banks are only listing a small number of the homes that they have repo’d. The remainder are sitting empty, or being used for Malibu beach parties. There’s nothing wrong with that part. It is the right of a bank to do what it will with the property it owns. It is under no obligation to sell or hold individual real estate holdings.

But when all of the banks operate in concert and do this with such a large majority of the homes, doesn’t that qualify as collusion? Isn’t that kind of what OPEC tries to achieve with oil? And what deBeers used to do with diamonds?

And shouldn’t I get a second bathtub for that price?

I think the logic in this is pretty simple. It’s going to take a seriously quantum rebuttal to refute this proposal.

And no, you don’t get to go using fancy fake math on this one. I want to see all of your work and you must be able to explain it as simply as my assertion. No extra credit.